Australian Vanadium Nears Feasibility Milestone, Advances Battery Storage Ambitions

Upstream Progress – Refining the Australian Vanadium Project

Australian Vanadium Limited (ASX – AVL) has made significant strides in the development of its flagship Australian Vanadium Project, located near Meekatharra and Geraldton in Western Australia. Phase 2 of the Optimised Feasibility Study (OFS) is approaching completion, with key engineering deliverables finalized, including concentrator and processing plant layouts, mass balance, and logistics cost studies. These efforts are shaping a refined execution strategy and updated capital cost structure, setting the stage for a more efficient and economically viable project.

Alongside technical progress, AVL has submitted amendments to the Environmental Protection Authority to update its Environmental Review Document, reflecting the consolidated project scope. Baseline environmental monitoring continues at both the Gabanintha and Tenindewa sites, ensuring regulatory compliance and supporting the project's sustainable development.

Midstream Momentum – Scaling Vanadium Electrolyte Production

AVL’s midstream activities are advancing with a focus on qualifying vanadium electrolyte products with leading global vanadium flow battery (VFB) manufacturers. The company is aligning analytical methodologies to meet stringent certification standards, a critical step toward commercial readiness. Concurrently, AVL is progressing engineering design and cost assessments to expand its electrolyte manufacturing capacity in Perth, positioning itself to meet anticipated demand from Project Lumina and other large-scale energy storage opportunities.

Strategic stakeholder engagement has been a highlight this quarter, with visits from the UAE Ambassador, senior Australian government officials including the Treasurer and Minister for Finance, and representatives from Sumitomo Electric Industries. These interactions underscore AVL’s strategic role in Australia’s battery materials value chain and its alignment with national energy transition policies.

Downstream Development – Project Lumina and Energy Storage Solutions

VSUN Energy, AVL’s wholly owned subsidiary, continues to develop Project Lumina, a scalable, turnkey utility-scale vanadium flow battery energy storage system tailored for Australian markets. Recent design iterations have focused on modularity, faster deployment, and increased local content, achieving a competitive levelised cost of storage (LCOS) of A$214/MWh for an 8-hour duration system. This represents a notable improvement from earlier estimates and positions vanadium flow batteries as a compelling alternative to lithium-ion solutions in long-duration storage applications.

VSUN Energy is actively pursuing deployment opportunities across five Australian states, including a significant proposed 500MWh vanadium battery project in Kalgoorlie supported by the Western Australian government. Collaborations with Curtin University and ongoing discussions with potential energy offtake partners further demonstrate AVL’s commitment to embedding vanadium flow battery technology within Australia’s energy infrastructure.

Corporate and Financial Overview

AVL reported a cash balance of $11.5 million as of 30 June 2025, including $5.1 million in federal government grant funds earmarked for eligible activities. The company received a $1.59 million R&D tax refund for the 2023/24 fiscal year, supporting ongoing innovation efforts. However, AVL also disclosed a $3.7 million stamp duty liability related to a prior merger, consistent with earlier guidance.

Cost-saving initiatives implemented during the quarter, including staff reductions and discretionary spending cuts, aim to preserve cash reserves while maintaining strategic momentum. AVL continues to benefit from substantial federal government support through the Modern Manufacturing Initiative, which has contributed $24.5 million to date toward the $49 million grant commitment.

CEO Graham Arvidson emphasised AVL’s progress across all pillars of its vertically integrated strategy, highlighting the company’s ambition to become a globally competitive supplier of battery-grade vanadium products and energy storage solutions. He noted the importance of AVL’s alignment with Australia’s energy security and decarbonisation goals, supported by proven technology and growing government backing.