A long-mooted vanadium-titanium project near Sandstone could get a kickstart after proponent Neometals signed an agreement with a Chinese research group to develop the mine.

Chris Reed’s Neometals has flagged a memorandum of understanding with the Institute of Multipurpose Utilisation of Mineral Resources Chinese Academy of Geological Sciences to evaluate and develop the $692 million Barrambie project via a potential joint venture.

The State-owned entity is among the top Chinese metallurgical institutes and has extensive experience in minerals processing and smelting of vanadium-titanium concentrates. The group also has close ties with China’s titanium and vanadium chemical processing industry.

Neometals noted the institute had previously conducted test-work for it on bulk ore samples from Barrambie and was intimately familiar with the project’s ore body.

Under the terms of the agreement, Neometals will continue its existing test work program producing high-purity titanium and vanadium chemicals from Barrambie, with mineral concentrate being sent to China next year for further processing. A demonstration plant in China could follow as well as a study to evaluate a mining and concentrating operation at Barrambie with subsequent downstream processing in China.

Ultimately the partnership could result in a 50/50 joint venture and final investment decision by mid-2021.

Neometals said the institute had a government mandate to develop upstream supply chains for industries of strategic relevance to China and could assign its interests in the agreement to a commercial Chinese chemical processing partner.

A cashed-up partner would ease the steep cost of building the traditional salt roast-leach project for Neometals, with Barrambie’s big price tag having been a continuing obstacle to its development.

Neometals has already pumped more than $30 million into exploring and evaluating the project since 2002.

Mr Reed described Barrambie as one of the world’s richest titanium and vanadium deposits and China as the biggest producer of chemicals associated with the commodities. He suggested Neometals would employ the same strategy for Barrambie as it had for its Mt Marion lithium project, which involved building project value and then locking in strong partners to expedite its development.

A revised definitive feasibility study for the 280Mt Barrambie project in May envisaged an operation producing 6337 tonnes of ferrovanadium a year over 15 years with a 5.1 year payback period.

Vanadium is used as a strengthening agent in steelmaking and in redox flow batteries that store renewable energy while titanium is used as a lightweight alloy in the aerospace and military sectors and has a range of other industrial and consumer applications.