Vanadium Resources Limited (ASX:VR8)

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Current share price for VR8 : $0.030 -0.031 (-50.82%)⁺

Announcement

V-Iron Plant Scoping Study Supports Progression to DFS

Release

5 Oct 2026 9:20AM

Price at Release

$0.061

Full Release

Summary

Vanadium Resources Limited (ASX: VR8) announced a Scoping Study supporting progression of its proposed V-Iron development pathway to a feasibility study, based on integrating the Steelpoortdrift Project in Limpopo, South Africa with a proposed V-Iron plant at Highveld Industrial Park to co-produce vanadium-rich slag and pig iron; the study, which is preliminary and carries ±30% accuracy and does not support Ore Reserves, indicates a 30-year project producing about 65,000 tonnes per annum of vanadium-rich slag grading 26.7% V2O5 and 603,000 tonnes per annum of pig iron from roughly 1.0Mtpa of concentrate, with Base Case economics using 2016–2025 real median prices of post-tax NPV10 of about US$842 million, post-tax IRR of 36%, average annual EBITDA of US$226 million, average annual free cash flow of US$164 million, pre-production capital of about US$400 million, and payback of about 2.4 years from first production; the study highlights strategic potential to supply vanadium raw material into U.S. and allied markets under a non-binding term sheet with U.S. Vanadium for 100% of planned slag output, while also supplying pig iron to South African steelmakers, leveraging existing mine and concentrator work from the 2022 DFS, brownfield industrial infrastructure at Highveld, and a granted Mining Right, Water Use Licence and Integrated Environmental Authorisation for the mine and concentrator, but notes key risks around commodity prices, exchange rates, metallurgical execution, power supply and cost, offtake, permitting for the plant, and especially funding, with VR8 now seeking support from development finance institutions and strategic investors to advance a V-Iron DFS expected to cost about US$3 million.

Key Points

VR8 completed a Scoping Study for an integrated vanadium and iron co-production operation based on the Steelpoortdrift Project and a proposed V-Iron plant at Highveld Industrial Park in South Africa.
The study supports progressing to a V-Iron Definitive Feasibility Study, subject to funding.
The Scoping Study is preliminary with estimated accuracy of plus or minus 30% and is insufficient to establish Ore Reserves or assure economic viability.
Base Case economics show a post-tax NPV10 of approximately US$842 million and a post-tax IRR of approximately 36%.
Average annual EBITDA is estimated at approximately US$226 million and average annual free cash flow at approximately US$164 million over production years.
Pre-production capital is estimated at approximately US$400 million including contingency.
Proposed nameplate production is about 65,000 tonnes per annum of vanadium-rich slag grading 26.7% V2O5 and about 603,000 tonnes per annum of pig iron.
The project evaluation period is 30 years with payback estimated at about 2.4 years from first production and about 4 years from construction start.
The plant would process about 1.0 million tonnes per annum of magnetite concentrate sourced from Steelpoortdrift.
The process route involves pre-treatment and pre-reduction, open bath DC furnace smelting, and vanadium recovery by oxidative blow.
Vanadium-rich slag is intended for U.S. and allied markets, while pig iron is targeted at South African steelmaking and foundry customers.
VR8 has a non-binding offtake term sheet with U.S. Vanadium covering 100% of planned vanadium slag production.
The study assumes domestic pig iron sales using import-parity pricing with a discount to secure local offtake.
At spot prices as at 14 September 2026, the study indicates an estimated post-tax NPV of about US$665 million and IRR of about 31%.
Sensitivity analysis shows the project is most sensitive to exchange rate and pig iron price, followed by vanadium price.
A low price case still shows a positive post-tax NPV of about US$53 million but would not support the assumed debt structure without mitigation.
The estimated minimum debt service coverage ratio in the Base Case is approximately 3.5 times, above typical project finance minimums.
VR8 holds an 86.49% interest in the Steelpoortdrift Mining Project and a 100% interest in the proposed V-Iron plant vehicle.
The production target is based on Mineral Resources and prior 2022 DFS mining information, with about 97.5% from Measured and Indicated categories and about 2.5% from Inferred resources.
No Ore Reserve has been estimated for the V-Iron route because the previous 2022 DFS Ore Reserve related to a different processing route.
The preferred plant site at Highveld Industrial Park offers brownfield heavy industrial infrastructure including electricity, water, gas, road and rail access.
Key risks include commodity prices, exchange rates, metallurgical performance, capital cost accuracy, energy cost and supply, offtake, logistics, permitting, tenure and funding.
VR8 is focused on securing funding for the V-Iron DFS through development finance institutions, strategic investors and advisory support from RMB.

IMPORTANT NOTE: This information is autogenerated and has not been reviewed for accuracy or completeness. You should refer to the full announcement here for further information.