U.S. Vanadium said Monday that it has closed on its purchase of a vanadium-processing plant near Hot Springs and plans an investment of some $8.5 million over the next 18 months.
About 70 people will be employed at the plant by the end of 2020, with 20 or so additional hires possible, depending on production capacity being reached, U.S. Vanadium officials said.
The plant is just off U.S. 270 east of Hot Springs. It is not related to the now-closed vanadium mining operation on some 500 acres a couple of miles to the west, near the Dr. Martin Luther King Jr. Expressway. Those old mines are under a reclamation project that has been ongoing for about three decades by its owner, Umetco Minerals Corp., which has been planting grass and trees on the property and turning former mining pits into lakes.
Generally, vanadium is a chemical element found in certain minerals that, when extracted, can be used to strengthen steel.
But the high-purity vanadium products processed in Hot Springs are essential to "vanadium redox flow batteries," or VRBs, used in large-scale electrical grid energy storage, such as from solar and wind energy, the company said.
Vanadium pentoxide (V2O5) and vanadium trioxide (V2O3) will be used at the Hot Springs plant to make alloys for those batteries and other products used in the aerospace, military, petrochemical and other industries, the company said.
U.S. Vanadium purchased the Evraz Stratcor plant from Evraz, a steel-making and mining company based in the United Kingdom with operations in Russia, Ukraine, Kazakhstan, Italy, Czech Republic, Canada and South Africa.
A purchase price hasn't yet been disclosed by either company. U.S. Vanadium is privately owned, while Evraz is listed on the London Stock Exchange. Major investors in U.S. Vanadium include Techmet Limited, Elysee Development Corp. and The Lind Partners.
The Hot Springs plant has produced vanadium and other products since the late 1960s.
U.S. Vanadium LLC was formed by private investors specifically with the Hot Springs plant in mind, Jody Orme, the company's chief executive officer, said Monday.
U.S. Vanadium began operating at the site on a "tolling" agreement with Evraz in mid-2018, with 23 employees producing vanadium alloys for customers on contract. Employment and production at the plant had dwindled to almost nothing between 2008 and U.S. Vanadium's entry in 2018, Orme said. Hot Springs, for now, is the company's only facility.
The company now has about 50 employees, Orme said.
Orme said employment rolls will grow to 70 by the end of next year and possibly reach 90 if the company reaches a "full capacity" of 12 million pounds of highest-purity vanadium pentoxide each year.
U.S. Vanadium will take waste material containing vanadium from operations in steel, oil and gas industries, extract the vanadium, and have it trucked to aerospace, petrochemical, automotive and pollution-control industries for other products, he said.
According to the Central Arkansas Library System's Encyclopedia of Arkansas, major deposits of vanadium were discovered by Union Carbide in Arkansas in the 1960s, in two isolated igneous intrusive complexes in the Ouachita Mountains. They became known as the Potash Sulphur Springs (now Wilson Springs) complex in Garland County and the Magnet Cove complex in Hot Spring County. The Wilson Springs vanadium deposits were the first to be mined solely for vanadium in the United States, according to the Encyclopedia.
Umetco, a subsidiary of Union Carbide, has spent more than $40 million reclaiming the 500-acre site, since open-pit mining ceased in 1986, according to its website. The project is nearing completion, with more work being conducted in improving the water quality of Wilson Creek and Indian Spring Creek, Umetco said.
In 2013, officials in Hot Springs announced interest in developing at least part of the site into a regional sports complex, parks and hiking trails.
That interest remains as the reclamation efforts continue, Steve Arrison, chief executive officer of Visit Hot Springs, the city's advertising and promotion arm, said Monday.
In August, when Evraz and U.S. Vanadium first announced the planned sale, Evraz said it had made $343 million from vanadium in alloys and chemicals, a 13% drop from price highs last year, according to a news release.
According to a report last spring from Acumen Research and Consulting, the overall vanadium market size is expected to be worth about $56 billion by 2026.
Business on 10/15/2019
Print Headline: Sale of element plant is finalized