Can you provide an introduction to Largo Inc.?

Largo has a two-pillar business strategy that includes being a tier one vanadium supplier with an emerging vanadium battery business. We are the world's largest and one of the highest-grade primary producers of vanadium, with one of the lowest costs of production from our Maracás Menchen mine in Brazil. At the same time, we are developing a titanium business, which is an optimization of our mining asset in Brazil. We expect to produce the titanium from the same ore that we produce our vanadium from.

We produce approximately 7% of the global vanadium supply, and on the titanium side, we are expected to produce about two thirds of the Brazilian demand for titanium pigment once the project reaches full capacity. We are not only going to sell the ilmenite titanium mineral, but we will also produce white pigment, which is the next step in the titanium production chain. In trying to add more value to our vanadium, and meet the needs of the energy transition, we developed our business based on the vanadium redox flow battery (VRFB). After acquiring certain VRFB technology patents in December 2020, we established Largo Clean Energy, and are in the process of developing the best solution for long duration energy storage. Can you elaborate on Largo’s future titanium production plans at Maracás Menchen?

Our Ilmenite plant is already in progress, and it will start producing in Q2 2023. We expect a six-month ramp up before reaching production levels of 145,000 t/y of ilmenite. We are also in the process of implementing the first phase of our titanium pigment plant with a capacity of 30,000 t/y of TiO2. According to our latest filed NI 43-101 technical report, we have outlined a plan to expand our titanium pigment plant capacity to produce 60,000 t/y, with a subsequent expansion plan to 120,000 t/y of TiO2. What applications will drive the future growth in demand for vanadium?

As it stands today, vanadium is an important strategic metal for the steel industry, because steel is strengthened with very small amounts of vanadium. This represents about 90% of the demand for vanadium. Another 4% goes to aerospace, 4% to chemicals, and about 1% goes to the VRFB.

The application of vanadium for batteries related to the energy transition should result in consumption of 4,000 t of V2O5 in 2022, 10,000 t in 2023, and 20,000 t in 2024. It is expected that in about 10 years, the energy transition will demand the entire amount of vanadium that is being produced today. What was the rationale behind Largo’s strategic pivot from primary vanadium miner to a fully integrated vanadium redox flow battery technology company?

We wanted to create more value for our high-grade vanadium. We identified VionX as having the best VRFB technology, because the energy density is about five times greater than any of the VRFB alternatives. We bought the technology in 2020, with the goal being to develop the best product for long duration energy storage. It is our belief that VRFB technology is more competitive than lithium-ion because it is safe, and it has the power unit separated from the energy unit. With a VRFB, you do not need to increase the power unit for long duration applications (8 to 10 hours for example), you just need to increase the volume of the vanadium electrolyte. We use a vanadium electrolyte on both the anode and cathode side, which means there is no cross contamination, and the vanadium electrolyte does not degrade.

Our battery life is expected to be about 25 years due to the unique characteristics of vanadium. Vanadium is inherently unique when used as electrolyte because it never degrades. That is very sustainable, and it will allow us to establish a very important business strategy for the electrolyte. Vanadium represents about 40% of the cost of a battery. This compelled Largo to launch Largo Physical Vanadium (VAND:TSX.V), which is a company that purchases and owns a portfolio of vanadium products to give investors exposure to vanadium price.