Idemitsu to take majority stake in Australian vanadium developer Vecco
By Yuka Obayashi
TOKYO, Dec 18 (Reuters) -Japan's Idemitsu Kosan 5019.T said on Wednesday it would increase its stake in Vecco Group to 50.1% from 14.7%, gaining a majority in the Australian vanadium developer as part of its expansion into critical minerals used in batteries.
The move is aimed at capturing a chunk of the fast-growing renewable energy storage market.
Idemitsu will lead the creation of an integrated vanadium supply chain, spanning mine development to electrolyte production, marking its full-scale entry into the critical minerals business, the company said in a statement.
Vecco is developing the Debella project in Queensland, focusing on a vanadium mine and an electrolyte plant for vanadium flow batteries (VFBs). The project aims to establish a local supply chain for mining vanadium ore, refining vanadium pentoxide, and producing vanadium electrolyte.
In 2023, Vecco began operating Australia's first commercial-scale vanadium electrolyte facility. A detailed feasibility study for the vanadium mine is planned for early 2025, with mine construction set for 2026 and operations targeted to begin in 2027, Idemitsu said.
"Demand for energy storage will likely grow in developed countries as power consumption increases and the share of renewable energy rises," Idemitsu senior executive officer Yuzo Yoshida told reporters.
"We want to leverage our knowledge and experience we have built over many years in coal mining in Australia," he said.
Idemitsu's total investments into Vecco will reach 75 million Australian dollars ($47 million) after completing the additional purchase next month.
Vanadium is seen as a technology that promises longer storage times and improved safety.
VFBs, which use vanadium-based electrolytes, are suitable for power system storage due to their easy scalability, long lifespan with minimal deterioration, and no risk of ignition, according to Idemitsu.
Storage is critical to help balance supply and demand when wind and solar farms produce more renewable electricity than the grid's distribution system can handle, or when a lack of sun or wind means they are generating too little power.
($1 = 1.5843 Australian dollars)
Reporting by Yuka Obayashi; Editing by Emelia Sithole-Matarise
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