Australian Vanadium raising $7.5 million to help pitch for $150 million Kalgoorlie-Boulder battery project

One of the companies seeking the contract for the State Government’s $150 million vanadium battery project in Kalgoorlie-Boulder is raising $7.5m to help with its pitch. Australian Vanadium told the market on Wednesday the raising was being supported by new institutional investors along with ongoing backing from the company’s existing major shareholder, RCF Private Equity Fund. It will see 28,846,736 new fully paid ordinary shares issued at 26¢ each, which is a 14.8 per cent discount on last Friday’s closing price and 11.7 per cent discount on the five-day volume-weighted average price. The company said given the timing of key permitting processes, competitive tender activity in relation to the Kalgoorlie-Boulder battery opportunity and current global market volatility, the board considered it appropriate to strengthen Australian Vanadium’s funding position. It said the board acknowledged the company cash position of about $18m at December 31, and the decision to undertake the placement reflected a prudent and forward-looking approach to balance sheet management while improving the institutional profile of the share register. Chief executive Graham Arvidson said Australian Vanadium was pleased with the level of support for the raising. “The company has taken a disciplined approach to the size and structure of this raising, balancing shareholder dilution with the importance of maintaining strategic momentum,” he said. “This funding provides the company with a strong platform to pursue the Kalgoorlie VBESS opportunity while maintaining momentum across our vertically integrated vanadium strategy. “Importantly, the level of demand reinforces confidence in our integrated strategy and provides us with funding certainty as we progress the Kalgoorlie VBESS project, including our early investment in Project Lumina, our collaboration with Sumitomo Electric, and other key milestones across the value chain.” The State Government last month said it would be seeking detailed business cases for the Kalgoorlie-Boulder battery project after receiving more than 20 submissions during the expressions of interest process. The Government said the number of submissions indicated there was clear industry willingness to invest in all aspects of the vanadium supply chain in WA. The plan is to have the 50MW/500MWh vanadium flow battery energy storage system operational by 2029. The Government said the project would not only create jobs and diversify the economy but also strengthen the electricity grid in the Goldfields. The Cook Government recently provided vanadium miners significant royalty relief, with a 2.5 per cent royalty rate being applied to vanadium products to incentivise production of the critical mineral in WA and encourage the emerging vanadium battery industry.