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Manganese for Traditional & EV Markets

Element 25 Ltd (ASX:E25, OTCQX:ELMTF) is investigating the potential to crank up operations again at its 100%-owned Butcherbird Manganese Project in Western Australia.

This decision follows a significant rise in manganese ore prices, driven by supply disruptions at South 32’s Groote Eylandt (GEMCO) operations.

Manganese ore prices have surged to a four-year high of US$8.30 per dry metric tonne unit (dmtu) for 44% cif Tianjin, China.

This price increase presents a potential opportunity for Element 25 to generate short-term cash flow by processing run-of-mine (ROM) and low-grade stockpiles at Butcherbird.

Managing director Justin Brown said: “A potential restart of Butcherbird’s processing operations at these increased manganese ore prices on a de-risked basis may be an ideal opportunity to monetise existing stockpiles and generate short-term cashflow.”

GEMCO, which typically produces more than six million tonnes of high-grade manganese ore annually, experienced damage to its haul road and ship loading facilities due to Tropical Cyclone Megan in March 2024.

The resulting supply disruption is expected to last up to 12 months, with GEMCO targeting a production restart in the third quarter of 2025.

Additionally, political instability in South Africa has exacerbated the supply shortage, leading to heightened competition for available manganese ore.

Element 25’s operations team and board are evaluating the feasibility of processing existing stockpiles to capitalise on the current market conditions.

The company had suspended Butcherbird production in early 2024 due to depressed ore prices while preparing for facility upgrades aimed at achieving a nominal 1.1 million tonnes per annum manganese concentrate production.

These upgrades were outlined in a feasibility study completed in January 2024.

The company acknowledges that the restart requires several critical steps, including assessing operational readiness and production costs.

All that said, the board believes this is a unique opportunity worth exploring.

Restart investigations will focus on minimising cash outflows by leveraging existing partnerships with mining and haulage contractors and using current port access agreements.

Discussions are also underway with the company’s existing offtake partner, OM Holdings Ltd, regarding the recommencement of ore sales.

“E25 looks forward to updating the market further as these investigations are completed and we will continue to monitor ore markets in the meantime to optimise any potential opportunities that may arise,” Brown said.

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Element 25 eyes opportunity to boost cashflow with Butcherbird restart as manganese price soars