Element 25 has moved its Butcherbird manganese expansion from feasibility into project delivery, targeting mechanical completion and commissioning in the first quarter of calendar 2027. The company also strengthened funding and commercial support, although construction, financing conditions and the absence of FY2026 revenue leave execution as the central test.
- Butcherbird expansion targets 1.1Mtpa of manganese concentrate
- A$50 million NAIF facility executed after year-end, subject to financial close
- US$166 million Louisiana HPMSM grant agreement revised
- FY2026 revenue was nil and net loss narrowed to A$2.14 million
- Post-year-end offtake covers 100% of Butcherbird concentrate, subject to HPMSM carve-outs
Butcherbird Moves From Study to Delivery
Element 25 Limited (ASX:E25) is no longer presenting Butcherbird merely as a promising expansion study. The Western Australian manganese project has entered a coordinated delivery phase, with the company targeting mechanical completion and commissioning in the first quarter of calendar 2027 for an operation designed to produce 1.1 million tonnes of manganese concentrate a year.
The transition is visible in the hardware and contracts. Altris Engineering has been appointed lead project engineer, an integrated project team has been established, and a 600-tonne-per-hour logwasher arrived in Western Australia in June. Integrated mining and haulage contracts with ReGroup are intended to place pit-to-port activity under a single operating model, while key equipment including mineral sizers, conveyors, stackers and screens has been ordered or is nearing final award.
Funding Framework Takes Shape
Element 25 raised A$10 million in September 2025 and a further A$18 million in April 2026 through share placements. It also executed a binding A$50 million Northern Australia Infrastructure Facility package in September 2026, comprising a A$42.5 million term facility and a A$7.5 million cost-overrun facility.
That debt agreement is a significant step beyond an earlier funding commitment, but it is not the same as cash in the bank. The annual report says financial close, first drawdown and other conditions precedent remain outstanding. At 30 June, Element 25 held A$18.28 million in cash, after recording A$8.09 million of plant and equipment purchases and a A$2.81 million operating cash outflow during the year.
Offtake and Government Support Add Commercial Weight
After year-end, Element 25 signed a binding take-or-pay agreement with OM Materials (S) Pte Ltd, a subsidiary of OM Holdings Limited (ASX:OMH), covering 100% of Butcherbird manganese concentrate for an initial five-year term, with an option for a further five years. The arrangement is subject to carve-outs for future high-purity manganese sulphate monohydrate, or HPMSM, feedstock requirements and includes restrictions on resale into certain downstream markets.
The company also secured a revised US$166 million grant agreement with the United States Department of Energy for its proposed Louisiana HPMSM facility. Element 25 is reviewing the project's execution plan to account for changing battery chemistries, including lithium manganese-rich and lithium manganese iron phosphate technologies. The grant remains strategically important, but the project itself is still being repositioned rather than constructed.
No Revenue During the Expansion Year
The financial statements show the cost of pausing shipments while the expansion advances. FY2026 revenue was nil, compared with A$1.88 million a year earlier, while the net loss narrowed to A$2.14 million from A$5.87 million. Care and maintenance costs were A$667,973, and a A$963,267 inventory adjustment was recognised against manganese stockpiles considered likely to be affected by the expansion.
Net assets rose to A$80.28 million from A$55.07 million, largely reflecting the equity raisings and project expenditure rather than operating earnings. Assets under construction reached A$34.32 million, including A$14.71 million attributed to Butcherbird and A$19.58 million to the HPMSM project. A favourable settlement with an external service provider after year-end also led to a A$2.8 million receivable and a reduction of about A$3.0 million in capitalised project expenditure.
The Execution Gap Remains
Element 25's January 2025 feasibility study remains the economic foundation for BBX, with estimated capital cost of A$64.8 million, a pre-tax real NPV of A$561 million, a 96% IRR and a 1.3-year payback. Those figures are study outputs, not operating results, and the company itself identifies construction conditions, commodity prices, water supply, transport and operating costs as material risks.
The next milestones are therefore practical rather than promotional: financial close and first drawdown under the NAIF facility, completion of remaining contractor awards, delivery of long-lead equipment and the start of full construction. With no manganese shipments recorded in FY2026, the Q1 2027 commissioning target will be judged against whether the project can convert a well-funded plan into a working mine and processing circuit.
Bottom Line?
Element 25 has assembled more of the commercial and financing architecture around Butcherbird, but the investment case now turns on construction delivery, funding drawdown and the first return to production.
Questions in the middle?
- When will the NAIF facility reach financial close and first drawdown?
- Can the remaining construction packages be awarded and delivered without eroding the feasibility study's capital assumptions?
- How will the revised Louisiana HPMSM plan affect capital requirements, timing and the manganese feedstock balance with Butcherbird?