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Bushveld Minerals Ld - Deployment of Vanadium Electrolyte Rental Product

RNS Number : 6530B
Bushveld Minerals Limited
10 June 2019


10 June 2019

Bushveld Minerals Limited

("Bushveld Minerals" or the "Company")

Bushveld Energy and Avalon Battery Innovate with Vanadium Electrolyte Rental

Bushveld Minerals Limited (AIM: BMN), the AIM listed, integrated primary vanadium producer, with ownership of high grade vanadium assets in South Africa, is pleased to announce, that its 84%-owned energy subsidiary, Bushveld Energy Limited ("Bushveld Energy"), has enabled the successful deployment of an innovative vanadium electrolyte rental product in industrial-scale batteries developed and sold by Avalon Battery Corporation of Fremont, California ("Avalon Battery" or "Avalon").


Bushveld Energy and Avalon Battery worked together to structure and design this specific rental product. This included creating a financial model for the product and a set of legal agreements for the transaction. The complexity stemmed from developing financial and non-financial terms acceptable to three different parties - a vanadium producer, a battery company and an electricity customer. The structures and documentation created from this project are available to both Bushveld Energy and Avalon Battery to use in future projects, making it easier and faster to execute vanadium electrolyte rentals in the future.


Avalon's customer, Santa Cruz Westside Electric Inc., doing business as Sandbar Solar & Electric ("Sandbar"), a leading Santa Cruz, California-based installer of commercial, industrial, and residential solar photovoltaic ("PV') systems, recently installed a solar PV mini grid at its 11,500 square foot facility. Sandbar incorporated an energy storage system consisting of three Avalon Vanadium Redox Flow Batteries ("VRFBs") for full independence from the electric grid. Sandbar chose to rent the vanadium electrolyte component of the Avalon batteries from Avalon, rather than purchase it outright, due to the cost efficiencies of the Bushveld-Avalon rental structure.


Batteries that use vanadium electrolyte to store energy have a major advantage over competing battery technologies as vanadium does not degrade, therefore, the performance of electrolyte batteries does not deteriorate with age. Renting the electrolyte reduces capital costs, and essential consistent performance reduces overall costs, making VRFBs the most dependable, safe, and economical battery for energy storage systems.


The rental structure makes commercial sense for both battery manufacturers and vanadium producers and the residual value of the vanadium is essential to making this structure economically efficient. The majority of the challenges in implementing the product commercially were not financial but legal, including title ownership and risk allocation. Considering the uniqueness of the product, it was also critical to draft a legal agreement that current and future customers would be amenable to.


Mikhail Nikomarov, CEO of Bushveld Energy commented: "Renting electrolyte is only practical with vanadium because the metal does not degrade after its useful life, one more reason that vanadium is the preferred mineral for energy storage systems. We are pleased to partner with Avalon Battery for commercial deployment of a concept that has been in development for a while, but not successfully implemented. Now vanadium takes its place alongside gold, silver, and platinum, as a metal that can be leased, opening up immense future opportunities for this model."


Matt Harper, President and Chief Product Officer of Avalon Battery commented: "Avalon is thrilled to have partnered with Bushveld Energy for a project that both benefits our customers and highlights Bushveld Energy's spirit of innovation. Avalon's mission is to deliver battery solutions that are dependable, safe and economical, each a critical attribute for energy storage that will drive our electrical future. Renting electrolyte is a massive leap forward."


Scott Laskey, Founder and CEO of Sandbar commented: "Energy storage makes renewable energy a resource our customers can use when they need it, not just when they make it. However, the upfront cost of high-quality energy storage batteries like Avalon's has kept some of our customers from making the investment. Renting electrolyte makes energy storage truly economical."



Enquiries: [email protected]

Bushveld Minerals

+27 (0) 11 268 6555

Fortune Mojapelo, Chief Executive Officer

Chika Edeh, Head of Investor Relations

SP Angel Corporate Finance LLP

Nominated Adviser & Broker

+44 (0) 20 3470 0470

Ewan Leggat / Richard Morrison

Jonathan Williams / Richard Parlons

Alternative Resource Capital

Joint Broker

Rob Collins

+44 (0) 207 186 9001

Alex Wood

+44 (0) 207 186 9004

BMO Capital Markets Limited

Joint Broker

+44 (0) 20 7236 1010

Jeffrey Couch / Tom Rider

Michael Rechsteiner / Neil Elliot


Financial PR

Charles Vivian / Gareth Tredway

+44 (0) 207 920 3150


Financial PR (South Africa)

Miyelani Shikwambana

+27 (0) 11 502 7300



Bushveld Minerals is a low cost, integrated, primary vanadium producer, with ownership of high grade vanadium assets.

The Company's flagship vanadium platform includes a 74 per cent controlling interest in Bushveld Vametco Alloys (Pty) Ltd, a primary vanadium mining and processing company; the Mokopane Vanadium Project and the Brits Vanadium Project.

Bushveld's vision is to become a significant, low cost, integrated primary vanadium producer through owning high grade assets. This incorporates development and promotion of the role of vanadium in the growing global energy storage market through Bushveld Energy, the Company's energy storage project developer and component manufacturer. Whilst the demand for vanadium remains largely anchored in the steel industry, Bushveld Minerals believes there is strong potential for an imminent and significant global vanadium demand surge from the fast-growing energy storage market, particularly through the use and adoption of Vanadium Redox Flow Batteries.

While the Company's focus is on vanadium operations and the development and promotion of VRFBs, it has additional investments in coal, power and tin.

The Company's approach to project development recognises that, whilst attractive project economics are imperative, they are insufficient to secure capital to bring them to account. A clear path to production within a visible timeframe, low capital expenditure requirements and scalability are important factors in ensuring a positive return on investment. This philosophy is core to the Company's strategy in developing projects.

Detailed information on the Company and progress to date can be accessed on the website www.bushveldminerals.com.

About Bushveld Energy Limited

Bushveld Energy Limited is an energy storage solutions provider, exclusively focused on vanadium based energy storage systems, with registered offices in Mauritius and a wholly owned subsidiary in South Africa. Bushveld Energy recognises that electricity in Africa intersects paramount potential for social transformation with an immense commercial opportunity.

Launched in 2016, Bushveld Energy is focused on developing and promoting the role of vanadium in the growing global energy storage market through application in vanadium redox flow batteries. Its near term strategy is to deploy several VRFB systems as part of its longer term vision to become a significant electricity storage provider in Africa by 2020, meeting the demand for utility scale energy storage in Africa by leveraging South Africa-mined and beneficiated vanadium.



About Avalon Battery

Avalon Battery was founded on the principle that productized vanadium-based flow batteries will revolutionize energy projects and play a critical role in a renewable energy future. Avalon, with operations in Fremont, California, USA, Vancouver, Canada, and Suzhou, China, produces dependable, safe, and economical energy storage systems.

The foundations of Avalon's product excellence are its technology and engineering team. Since 2005, its team has designed, built and deployed more flow batteries than anyone in the world; the team now counts over 140 years' experience in flow battery development, has deployed over 15MWh of vanadium flow batteries since 2005, and invented over 50 related independent patents.



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Quick facts: Bushveld Minerals Ltd

Price: 11

Market: LSE
Market Cap: £126.83 m

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