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Excellent Results Generated from China-Based Battery Grade MNSO4 Scoping Study
Firebird Metals Limited (ASX: FRB, “Firebird” or “the Company”) is pleased to announce the successful completion of an in-house Scoping Study (“SS” or “Study”) for production of battery grade manganese sulphate in China utilising concentrate from its flagship Oakover Project, located 85km East of Newman, Western Australia.
- Strong results from the China-based Manganese Sulphate Scoping Study (‘SS’ or ‘Study’) affirm Firebird’s LMFP Battery Strategy, validating establishment of a China-based Manganese Sulphate Plant
- Key results include:
- Chinese circular industry provides localised key reagents and inputs that drive a low OPEX of approximately US$659/mt for production of battery grade manganese sulphate
- Total CAPEX of approximately US$82.3M, including land and a 30% contingency
- ~US$331M NPV at a discount rate of 8%, before tax1
- Payback period in less than 2 years
- Average ~EBITDA of US$48.3M, before tax1
- IRR of 47% before tax1
- Plant capacity of 72,000 mt/a of battery grade manganese sulphate (MnSO4) equivalent, producing:
- 50,000mt/a Battery Grade Manganese Sulphate (MnSO4); and
- 10,000mt/a Manganese Tetra Oxide (Mn3O4)
- Key reagents, sulfuric acid, steam and customers all located in close proximity to the potential Plant location
- Potential location to have capacity for future expansion through replication of Plant
- Following results of the Study, Firebird will promptly advance towards the Pre-Feasibility (‘PFS’) Stage for battery grade manganese sulphate production in China, while continuing to progress development of the Oakover Project
- The Company, through a recently announced Placement, is fully funded to complete the China-based Battery Grade Manganese Sulphate PFS and ongoing environmental surveys, metallurgical test work and Concentrate PFS studies for Oakover
- 2023 is seen by industry participants as the beginning of a new era for Li-ion batteries propelled by the commercialisation of LMFP batteries, having the steepest forecast growth of of any battery cathode active material formulation in the medium to long-term
- The rise of LMFP is imminent as LFP battery capacity is reaching its theoretical energy density capacity and more importantly, LMFP fits the strategies of end users as it is cost effective, safe and provides a long range
- The Study results place Firebird in a strong position to execute on its vision of becoming a global leader in the manganese industry, combining mining and downstream processing with a dedication to the advancement of the EV battery sector
Completion of the Study follows the conclusion of a Manganese Concentrate Production Scoping Study to mine and produce manganese concentrate at Oakover, which confirmed the Project as a long-life manganese operation (see ASX Announcement 30/08/2023).
Results from the Concentrate Scoping Study followed an 80% uplift in the Oakover Indicated Mineral Resource Estimate (MRE), which now stands at 105.8 Mt @ 10.1% Mn, and combined with an Inferred MRE of 70.9Mt, the total Oakover MRE now stands at 176.7Mt @ 9.9% Mn (all using a 7% Mn cut-off).2
The results generated from the in-house China-based Battery Grade Manganese Sulphate Scoping Study validate Firebird’s LMFP battery strategy to produce battery grade manganese sulphate in China, with a strong projected NPV of approximately US$331M, Total CAPEX of approximately US$82.3M, an impressive IRR of 47% and a payback period of less than two years.
Importantly, results from the Study have continued to build upon the strong platform for Firebird to successfully deliver on its vision to become a global leader in the manganese industry, combining mining and downstream processing with a dedication to the advancement of the Li-ion battery sector.
Firebird Managing Director Mr Peter Allen commented: “We are extremely pleased with the results from our China-based Battery Grade Manganese Sulphate Scoping Study, which reinforces the next phase of our growth strategy and demonstrates the true potential of Oakover.
“The past few months have been an exciting and transformative period for the Company as we embark on becoming a near-term producer of battery grade manganese sulphate. The delivery of this Study and the results generated marks the completion of another key milestone as we work through a busy 12 months ahead.
“Importantly, we continue to build on the strong platform we have created at Oakover and our vision to become a global leader in the manganese industry, combining mining and downstream processing with a dedication to the advancement of the EV battery sector. We are developing and pushing ahead with Oakover at the right time, as the use of manganese in EV batteries continues to grow rapidly.
“LMFP batteries are forecast for the largest growth of all the manganese-based batteries, due to the fact it meets the key criteria of car manufacturers - cheap, safe and delivers good range. 2023 is seen by many industry participants as the beginning of the new era of Li-ion batteries by commercialising LMFP and we are well-positioned to benefit greatly from this demand.”
This article includes content from Firebird Metals Limited, licensed for the purpose of publishing on Investing News Australia. This article does not constitute financial product advice. It is your responsibility to perform proper due diligence before acting upon any information provided here. Please refer to our full disclaimer here.
Firebird Metals (ASX:FRB) is an Australian mining company that’s well-positioned to develop a new manganese mining operation in Western Australia with a strategy to become a global battery cathode producer supporting a rapidly expanding electric vehicle market.
Batteries currently represent the largest non-alloy market for manganese, accounting for roughly 3 percent of global annual manganese consumption. The metal has a long history of being used as a cathode material in batteries, both in its natural form and in the form of electrolytic manganese dioxide. That includes modern lithium-ion batteries, the supply and manufacturing chain for which could potentially grow by over 30 percent annually from now through 2030.
Manganese-rich batteries are increasingly being held up as an alternative to standard lithium-ion batteries, leading to an expected exponential demand for the mineral. Tesla alone has already committed to producing manganese-based batteries for two thirds of its supply, owing to the metal's relative abundance and lower cost compared to nickel and cobalt.
Lithium-iron-phosphate (LFP) represents one of the most prominent phosphate battery configurations. In recent years, however, the business case for using manganese as a cathode material for lithium-ion batteries, known as lithium manganese iron phosphate (LMFP), has become stronger. LMFP not only improves the battery’s energy density, but also increases capacity by up to 20 percent. LMFP batteries also perform better in low-temperature environments.
As LFP rapidly nears its theoretical energy density capacity, the rise of LMFP batteries as a replacement is all but inevitable as the world continues its slow march towards electrification and sustainable energy. Consequently, this means that demand for battery-grade manganese is set to explode in the coming years. And Firebird Metals is more than ready to step in and provide some much-needed supply.
Firebird maintains ownership over a massive manganese resource in Western Australia's Pilbara region in the form of its flagship Oakover project. Characterised by near-surface mineralisation, Oakover houses an estimated 176.65 million tons (Mt) of manganese across several different targets. Because of Oakover's favourable geology, Firebird can potentially leverage Oakover to supply not just the battery market but also multiple other industries, such as steel, all through a low-cost, simple mining operation.
The end result? Significant returns for investors — a projection only further emphasised by the impressive results returned by a recent concentrate scoping study on the project. Firebird maintains several other projects in Australia as well, including the Oakover-like Hill 616 and the exploration-focused Wadanya.
Firebird's long-term strategy reaches far beyond Australia's borders, however. From mining to downstream processing, the company's vision is to become a global cathode producer. For that, Firebird is looking to China, which to date accounts for roughly 90 percent of global manganese sulphate demand.
In early September 2023, the company announced its plans to establish a processing plant in China, noting to investors that an in-house scoping study was already well underway. According to Firebird's managing director Peter Allen, the construction of this plant represents the next phase of major growth for Firebird. As with the rest of Firebird's operations, this new plant will be constructed with the company's ESG methodology front of mind, ensuring transparency and accountability in addition to human welfare, support for local communities and environmental sustainability.
This plan, should it proceed apace, has the potential to make an enormous impact on global manganese supply — all while positioning Firebird as a cost-competitive player in the manganese sulphate market and a promising investment opportunity.
- An Australian junior exploration company, Firebird Resources is well-positioned to take advantage of the growing demand for manganese as the rapidly expanding electric vehicle market and global electrification continue to ramp up.
- Firebird maintains ownership of a massive manganese resource in Australia with significant growth potential.
- A recent concentrate scoping study confirmed the potential and profitability of the company's flagship project, Oakover, situated in Western Australia's Pilbara region.
- Firebird's long-term goal involves leveraging its manganese resource to position itself as a leading global producer of manganese sulphate for the battery industry.
- The company is currently embarking on a scoping study with plans to build a manganese sulphate plant in China. This will allow it to gain a foothold in the Chinese market, which currently accounts for 90 percent of global manganese sulphate demand.
- This study represents the next phase of major growth for Firebird, and is a significant part of the company's overall strategy to establish itself as a near-term producer of battery-grade high-purity manganese sulphate.
Situated 85 kilometres East of Newman in Western Australia's East Pilbara Manganese Province, Firebird's flagship Oakover project is characterised by favourable near-surface and shallow-dipping mineralisation. The project's favourable geology provides Firebird with multiple processing options, with the company currently targeting production of manganese concentrate and high-purity manganese sulphate. Oakover has, over the course of its history, been subject to extensive modern and historic exploration.
The most recent exploration program, completed by Firebird, resulted in a mineral resource estimate of 176.65 Mt at 9.9 percent manganese, including 105.8Mt at 10.1 percent manganese in the indicated resource category.
- Confirmed Potential: Firebird recently achieved a major milestone at Oakover with the completion of a concentrate scoping study which confirmed the project's outstanding long-term potential as a manganese hub. Highlights of the study include:
- Potential 18-year mine life.
- 1.2 Mt per annum with low strip ratio (0.45:1) and mining costs.
- Upfront capital investment of A$124 million with low capex optionality.
- A$741.3 million NPV and IRR of 73.1 percent.
- Indicated material accounts for 99.2 percent of material processed.
- 80 percent uplift in indicated resource at Oakover to 105.8 Mt.
- Metallurgical Results: Firebird has undertaken extensive metallurgical and hydrometallurgical testwork at Oakover, with results providing the company with a high level of confidence in its growth and profit potential. Notable highlights are as follows:
- Achievable 30 to 32 percent manganese concentrate saleable product
- Achievable battery-grade manganese sulphate
- Current Plans: Firebird's concentrate scoping study assessed two production scenarios, each utilising simple processing, crush, screen, scrub and DMS beneficiation. It has chosen to pursue full production from startup with ~4 Mtpa processing and ~1.2 Mtpa of 30 to 32 percent manganese concentrate.
Located 35 kilometres south of the Oakover project, Hill 616 shares highly similar geological characteristics to Firebird's flagship, with shallow, gently dipping geology. Covering approximately 15.7 square kilometres within the Peak Hill Mineral Field, Hill 616 has to date undergone extensive historical drilling, with 116 holes for 4,900 metres over a 2.2-kilometre strike.
This drilling has resulted in an inferred mineral resource of 57.5 Mt at 12.2 percent manganese.
Wandanya is a recently established exploration-focused project situated 50 kilometres southwest of the world-class Woodie Woodie Manganese Mine. Its close proximity to Port Hedland affords it considerable direct shipping ore potential. Rock chip results indicate that Wandanya's deposits are also exceptionally high grade, returning results up to 64.9 percent and 55.2 percent manganese.
Evan Cranston — Chairperson
Evan Cranston is an experienced mining executive with a background in corporate and mining law. He is the principal of corporate advisory and administration firm Konkera Corporate and has extensive experience in the areas of equity capital markets, corporate finance, structuring, asset acquisition, corporate governance and external stakeholder relations.
Cranston holds both a Bachelor of Commerce and Bachelor of Laws from the University of Western Australia. He is currently the non-executive chairman of African Gold (ASX:A1G) and Benz Mining (TSXV:BZ, ASX:BNZ).
Peter Allen — Managing Director
Peter Allen is a mining executive with more than 20 years of experience in marketing of manganese, lithium and a range of other commodities. He was previously the managing director of marketing for Consolidated Minerals Limited, which operates Woodie Woodie mine in WA and the Nsuta Manganese mine in Ghana.
Allen assisted manganese-focused explorer Element 25 (ASX:E25) and Gulf Manganese Corporation (ASX:GMC) with PFS and product marketing. More recently, he was the marketing manager for AVZ Minerals (ASX:AVZ), a company focussed on the Manono lithium project.
Wei Li — Executive Director & CFO
Wei Li is a chartered accountant with extensive professional experience across several key sectors which include the resource industry, international trade, capital markets, project management of IPOs and spin-outs, and financial accounting. His experience includes being employed by and acting as director and CFO of several companies, predominantly in the resource sector. Prior to these roles, he managed a private base metal exploration company in the NT of Australia and assisted in commissioning an AU$150-million electrolytic manganese dioxide plant in Hunan China.
Li is currently a non-executive director of Macro Metals.
Ashley Pattison — Non-executive Director
Ashley Pattison brings over 20 years of experience in the resources sector across corporate finance and operational roles. Qualified as chartered accountant, he has extensive experience in operations, finance, strategy and corporate finance. Pattison has been the managing director of a number of listed and private mining companies over the past 10 years and also CEO of a listed mining service company.
Pattinson is currently the executive chairman of PC Gold and a non-executive director of Industrial Minerals (ASX:IND) and Macro Metals.
Brett Grosvenor — Non-executive Director
Brett Grosvenor is an experienced mining executive with over 25 years of experience in the mining and power industries. He holds a dual tertiary qualification in engineering and a master’s in business.