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Atlantic plans A$127M refurbishment of mothballed Windimurra vanadium project

Indonesian businessman Anthoni Salim's Droxford International Ltd. is expected to approve a A$127 million refurbishment of Atlantic Ltd.'s mothballed Windimurra vanadium project in Western Australia, The West Australian reported Aug. 15, citing Atlantic Director Tony Veitch.

The anticipated approval will pave the way to begin the project's front-end engineering and design this year and its construction, which will start in April 2019. Most of the capital cost will be used to rebuild the front-end crushing and milling section of the plant.

The vanadium explorer forecast CapEx of about A$150 million to bring the property back into production.

Ferrovanadium production at Windimurra was suspended in 2014 after a fire, and Indonesian investor Anthoni Salim has controlled Atlantic and the property through Droxford International since 2016.

Production is expected to resume in the first half of 2020, with production slated at 7,750 tonnes of vanadium pentoxide per year over an initial 25-year mine life.

At nameplate capacity, Windimurra is expected to deliver annual revenue of A$180 million, based on a vanadium price of US$8 per pound. However, vanadium pentoxide is trading at more than US$18/lb, which may result in a feasibility-study figure more than doubling should prices remain steady at current levels.

The price of vanadium was US$20.50/lb as of Aug. 14, according to S&P Global Market Intelligence data, the highest level seen since US$15/lb in late October 2008, with the rise in the last 18 months resulting from growing demand and restricted supply.

"There's a perfect opportunity to redevelop the project to meet the new demand that is emerging," Veitch told The West Australian.