The MoU with Win-Win Development Group, a private steel and alloy producer based in Chengdu, initiates discussions surrounding project finance and offtake of vanadium oxides from Gabanintha, Australian Vanadium said.

According to the ASX-listed company, Win-Win is currently building a 5000t per annum vanadium carbon nitride (VCN) production line which requires approximately 7000-8000tpa of 98% V2O5.

Production would begin in 2019, while Win-Win also has a shareholding in an operating production line currently producing 2400tpa of vanadium products for existing steel companies.

Australian Vanadium has been flagging first production in 2020-2021, with results of the prefeasibility work imminent.

Australian Vanadium was introduced to the Chinese company by consultant Mastermines.

Shares in Australian Vanadium were unchanged at 4.1c in afternoon trade, capitalising the company at about $67 million.