Member Info for mogwhy

If we assume that a utility scale vrfb project costs $400/kWh, then a 200MWh contract would be worth $80m.
That would include upfront purchase of the electrolyte.
We now know that if we strip out that cost and replace it with a lease, the total cost reduces by $18m.
So we can now put some rough numbers into the other activities.

BE valuation for 200 MWh contract (900t V)
1. Supplying the electrolyte. Revenue $18m. Profit $9m.
2. Lease agreement. Revenue $3.6m. Profit $0.5m (per annum)
3. Development and planning activities for the projects. Revenue $3m Profit $1m.
4. VRFB procurement (acting as a middleman). Revenue $55m Profit $1m.
5. Project installation and commissioning. Revenue $2m Profit $1m.
6. 25 year maintainance contract. Revenue $3m Profit $0.5m

That gives us Bushveld Energy revenue of $18m for the electrolyte and profit of $9m.

BE valuation for 200 MWh contract (900t V)
1. Supplying the electrolyte. Revenue $18m. Profit $9m.
2. Lease agreement. Revenue $3.6m. Profit $0.5m (per annum)
3. Development, planning and engineering activities for the projects. Revenue $ Profit $.
4. VRFB procurement (acting as a middleman for our partners). Revenue $ Profit $.
5. Project installation and commissioning. Revenue $ Profit $.
6. Ongoing 25 year maintainance contract. Revenue $ Profit $.

"So we now have revenue of $45m and profit of $15.3m for phase 1 of the BESS tender just for the vanadium and electrolyte production."
But I'm attempting to put a valuation on BE, so I need I need to strip out the Bushveld Minerals bit.
That leaves us with revenue of $18m for the electrolyte and profit of $4.5m.

Thanks Alfacomp. So the total revenue from the vanadium and electrolyte would be in the region of $45m.
We know the cost of the vanadium is around $18/kgV.
Until I can find a firm number, I'm going to put $15/kgV on the cost of converting into electrolyte.
That gives us a profit of $17 given a market price of $30.
So we now have revenue of $45m and profit of $15.3m for phase 1 of the BESS tender just for the vanadium and electrolyte production.

I've previously speculated that the market currently values Bushveld Energy at around £0.
If we assume that BE captures 25% of the phase 1 Eskom BESS contract (800 MWh), that would be a convenient 200 MWh which is the annual capacity of the new electrolyte plant in East London.
That would require 900 tonnes of vanadium.
The value of the vanadium to the group is easy to quantify, but what about the rest of the activities that would go into satisfying the contract. These could be
1. Supplying the electrolyte.
2. Lease agreement.
3. Development, planning and engineering activities for the projects.
4. VRFB procurement (acting as a middleman for our partners).
5. Project installation and commissioning.
6. Ongoing 25 year maintainance contract.

For a 200 MWh contract, what revenue and profit would each of these activities generate and what would that make the market value of BE?
If anyone has specific knowledge of any of the above activities or where to find the information, please post your educated guesses and let's see if we can add some numbers for revenue and profit to them.
That will allow us to have a stab at a valuation for BE at that stage, hopefully later this year.

Pdub, you've completely missed the point of my post.
I've highlighted the massive upside potential valuation of BE from only one part of its business from its current small project pipeline.

It's interesting to compare the sales pipelines of IES and BE.
IES have declared a total potential pipeline of 161 MWh including sales this year of 1.7 MWh and is valued at £100m.
BE have declared a project pipeline of 250 MWh and is valued at around £0.

Here's a rough idea of how the market has arrived at the current market cap of £160m.
Put your own figures in to see what the true value should be.

Cash.............................£14,000,000
Afritin 8%......................£1,117,900
Invinity 8.71%...............£6,483,730
Enerox..........................£0
Vametco 74%...............£70,000,000
Vanchem 100%............£35,000,000
Bushveld Energy 84%..£0
Brits..............................£10,000,000
Mokopane 57.6%..........£20,000,000
Belco 55%....................£0
Lemur...........................£5,000,000

Total.............................£161,601,630

Although the new Bushveld Energy website is a vast improvment, it obviously hasn't been proof read by a grown-up. It has numerous grammatical errors and typos, and silly capitalisation of random words.
Can someone with a reliable line of communication give Mikhail a nudge.

The nett importation into China is likely to be feeding the electrolyte requirement for the Dalian project which is due to come online in September.
Plus any other VRFB projects in the pipeline.
That requirement is only going to get larger.
Hence the increase in Chinese V prices.

https://tinyurl.com/y9nh4kj4

Lots of vanadium will be required for these major projects.

2mt electrolyte-- China - Fangchenggang (250,000 tonnes per year)
--------?------------- China - Ningde, Fujian (30,000 tonnes per year)
3,000 MWh pa -- Saudi Arabia, Dammam (13,500 tonnes per year)
1,000 MWh------- China - Jiangsu (4,500 tonnes)
---800 MWh------ China - Shijiazhuang (3,600 tonnes)
---800 MWh------ China - Dalian (3,600 tonnes in 2 stages)
---800 MWh------ South Africa - Eskom BESS phase 1 (3,600 tonnes)
---640 MWh------ South Africa - Eskom BESS phase 2 (2,880 tonnes)
---500 MWh------ China - Hubei Zaoyang Phase 2 (2,250 tonnes)
---400 MWh------ China - Yancheng (Shanghai Electric Group) (1,800 tonnes)
---400 MWh------ China - Wuhan (1,800 tonnes)
---200 MWh pa - South Africa - Bushveld Energy Phase 1 (900 tonnes pa)
---200 MWh pa - USA - New York (Margaret Lake) ph 1 (900 tonnes pa)
---200 MWh------ Australia - Port Augusta (CellCube) (900 tonnes)
-----40 MWh------ China - Hubei Zaoyang Phase 1 (180 tonnes)
-----40 MWh------ China - Wafangdian Zhenhai Wind Farm (180 tonnes)

Total of 320,590 tonnes of vanadium (based on 4.5 tonnes per MWh)

With the construction of the Bushveld Energy electrolyte plant in H2 this year, they will need some projects to supply.
With an initial electrolyte output of 200 MWh, it only needs part of the Eskom tender for the plant to go straight to full production. That would divert 900 tonnes of vanadium a year out of our current sales. That would be the trigger to greenlight the expansion of both the electrolyte plant and also Bushveld Minerals' vanadium output. That's a binary event which should happen in H2 this year.
Although B.E. is highly likely to get a portion of the Eskom contract, it isn't essential. We know that Mikhail has fielded hundreds of enquiries, so he only needs to land a small number of substantial contracts to generate 200 MWh of electrolyte production. Invinity will generate some requirement, but this is likely to be small in the near term.
One South African project which is on my radar is the 60 MWh vrfb storage for the Vogelstruisfontein SolarReserve project. I'm not sure if this is still planned, but there's a BMN connection and it would take nearly a third of the first years electrolyte output.
https://tinyurl.com/y9223cy3

There's a potential new large scale 800 MWh VRFB project in Shijiazhuang https://tinyurl.com/ycksbl3y
That will need around 3,600 tonnes of vanadium.
I've updated the table of large scale vrfb projects to use 4.5 tonnes of vanadium per MWh down from 5t. This seems to be closer to the latest thinking on the amount of vanadium required in current electrolyte production. Where the project concerned is electrolyte production (Fangchenggang), I've used 1 mtV per 8 tonnes of electroyte.

2mt electrolyte--- China - Fangchenggang (250,000 tonnes per year)
--------?------------- China - Ningde, Fujian (30,000 tonnes per year)
3,000 MWh pa -- Saudi Arabia, Dammam (13,500 tonnes per year)
1,000 MWh------- China - Jiangsu (4,500 tonnes)
---800 MWh------ China - Shijiazhuang (3,600 tonnes)
---800 MWh------ China - Dalian (3,600 tonnes in 2 stages)
---800 MWh------ South Africa - Eskom BESS phase 1 (3,600 tonnes)
---640 MWh------ South Africa - Eskom BESS phase 2 (2,880 tonnes)
---500 MWh------ China - Hubei Zaoyang Phase 2 (2,250 tonnes)
---400 MWh------ China - Wuhan (1,800 tonnes)
---200 MWh pa - South Africa - Bushveld Energy (900 tonnes per year)
---200 MWh pa - USA - New York (Margaret Lake) ph 1 (900 tonnes pa)
---200 MWh------ Australia - Port Augusta (CellCube) (900 tonnes)
-----40 MWh------ China - Hubei Zaoyang Phase 1 (180 tonnes)
-----40 MWh------ China - Wafangdian Zhenhai Wind Farm (180 tonnes)

Total of 318,790 tonnes of vanadium (based on 4.5 tonnes per MWh)

I realise that Fangchenggang skews the numbers and that it's going to produce enough vanadium to satisfy its own electrolyte production, but it will still need a raw material supply.

CowboyInvestor - thanks for that. Yes it is the area that I was looking at.
There's certainly been lots more development in the area, particularly in the square shaped peninsular to the west.
I've also found a 2020 Landsat image here as well which has better resolution but is probably not as recent as yours. https://tinyurl.com/yc9mv72d

As this such a huge vanadium electrolyte manufacturing project (2m tonnes pa), I'm interested in how far along this project is, so I've dug up the following limited timeline.

21 April 2017 https://tinyurl.com/y8bll8gb
On April 21, the Fangchenggang Municipal People’s Government signed agreements with China Energy Storage Materials Co., Ltd. and China Energy Storage Holdings Co., Ltd. to jointly build vanadium and titanium in the Fangchenggang Economic Development Zone New Material Industrial Park and Energy Storage Industrial Park.

8 April 2018 https://tinyurl.com/y7bvut8c
Next to Qisha Port, the Energy Storage New Material Industrial Park invested by China Energy Storage Materials (Hong Kong) Co., Ltd. is under construction. This project, with a total investment of more than 30 billion yuan, will become the largest new energy storage material production base in China when completed. It will use South Africa's high-grade vanadium-titanium magnetite resources to produce a new generation of high-purity vanadium electrolyte, provide core materials for the world's most advanced vanadium batteries, and sell them to all parts of the world, let the world know "Made in China".

So, in April 2018 it was reported that the project was under construction.
Note the South African connection.
So where is it now?
It seems that Quisha Port is actually spelt Qishazhen in China and this is in the Gangkou District, Fangchenggang.

Looking at Google Earth there is large area of construction just to the west of Qishazhen. The imagery is dated October 2018.
I might be barking up the wrong tree, but if anyone wants to have a look it's at 21°33'30.78" N 108°26'44.33" E.
Has anyone got access to more up to date satellite imagery?

"Fangchenggang Energy Storage Industrial Park project - upon completion, the project will provide an annual output of 250,000 tons of high-purity vanadium."
That's a huge amount of vanadium. I'm assuming that this can only be obtained by processing ore.
Can China source that amount of ore internally or will they have to go to Russia and South Africa?

Just to confuse things, the article below contradicts my previous link and states an output of 20GWh, not 20GW.
Either way, the effect on vandium supply and demand will be neutral, as the project will produce enough vanadium to supply its electrolyte requirements.
https://tinyurl.com/su75pb4

Spedders - thanks for pointing out this apparent discrepancy. I'm glad someone is paying attention !
Lindon is on the right track. I had wrongly allocated 20GW as the energy when it is actually the power output.
The projected output of electrolyte for this project is 1,900,000 tonnes per annum. There is approximately 1,000 tonnes of vanadium required for 8,000 tonnes of electrolyte, so 1.9m tpa would require 237,500 tonnes of vanadium.
https://v.gxnews.com.cn/a/16125133

Macanman - perhaps the Saudis would like to finance and fast track Mokopane.