South32’s Arizona manganese plant tapped for $166m US government grant

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The Taylor deposit represents the first phase of the project, targeting first production in fiscal 2027. It has the potential to become one of the world’s largest, lowest-cost zinc producers, with a nameplate capacity of 4.3 million tonnes annually and unit costs of $86/tonne of ore processed, as shown in its feasibility study. Its initial mine life is estimated at 28 years.

Following the delivery of the feasibility study, the board of South32 approved an investment of $2.16 billion to fund the construction of key infrastructure for the zinc mine, which had already begun last year.

Also last year, Hermosa became the first mining project added to the US FAST-41 permitting process designed to promote faster development of clean energy assets.

According to South32, the infrastructure at the zinc mine would support future potential development of other deposits at the site, including the battery-grade manganese deposit at Clark, which is subject to further study.

Manganese facility The DOE funding, once negotiated and secured, would provide 30% of the cost of its proposed commercial-scale manganese production facility, the Australian miner said in a press release on Friday.

While the exact location of the facility is yet to be determined, it will be in southern Arizona, South32 said. Construction for the manganese decline to enable bulk sampling through a demonstration plant and further underground exploration are continuing on schedule, with access targeted for the end of 2025.

The funding follows a $20 million award to the Hermosa project earlier this year from the Department of Defense Production Act Investment (DPAI) program to help accelerate the domestic production of battery-grade manganese.

“This project has the potential to provide a reliable, lower carbon and cost-effective domestic option for manganese products within the electric vehicle battery supply chain that currently relies entirely on foreign imports,” Pat Risner, president of South32 Hermosa said in the statement.

South32 says Hermosa could be scaled up as the only fully integrated source of battery-grade manganese for EV battery chemistries sufficient to supply the emerging North American market. Based on a third-party life cycle assessment, production from its deposit at Hermosa is projected to be the lowest carbon impact project in manganese chemicals in North America.

The US has not mined any manganese since the 1970s, and more than 95% of the current production of battery-grade manganese is currently in China, according to company estimates.

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