Thread by @BigBiteNow

1/11
Some further notes on the upcoming Eskom BESS Project.

Annual Report 2019 page 27;
"focused on the African market" hence why the Eskom project, easily the biggest in the world to date, first in Africa to be grid connected and right on #BMN doorstep, is firmly in BMN sights.

2/11
And;
"the country’s characteristic demand profile, which lasts for six hours a day and peaks twice a day, makes the
economics especially favourable for long-duration, nearly limitless recycling technologies such as VRFBs."

Add lower cost, locally produced, rented vanadium,

3/11
from a company that is partnered with the IDC of South Africa (see below) and the words 'strong competitive advantage' come to mind.

But of course, BMN now knows it needs a big VRFB partner to meet the JV requirements or its got to buy the VRFBs as a project developer.

4/11
To be the project developer, BMN are still going to need partners, if they are to mount an assault on the first 80MW tender because i still fear proven experience is lacking.

If they go down the Rongke Power route, then the following is of interest.

5/11
For several years BMN have talked about future local assembly and manufacture of VRFBs in South Africa.

On page 46 of the Annual Report, that they talk about "during the year BMN communicated its approach to VRFB manufacturing, including how it will work with VRFB OEMs."

6/11
What that does is set out the idea that manufacturing will be OEM led because BMN have been very clear, that they will retain a "minority stake" in these companies only.

So perhaps this is all about delivering sufficient project wins in Africa, to justify OEM set up there.

6/11
They then go on to state ;
"Bushveld Energy takes a holistic approach to the full value chain, from vanadium material and electrolyte sales
through to energy storage and project development in Africa, where we deploy VRFBs."

That indicates that in Africa, the role will be..

7/11
. .one of project developer and VRFB deployment, where possible.

I posted recently the @CruxInvestor interview from 11th Nov 2019 and the clear message that "if it is in Africa, then its (Bushveld Energy ) extremely active."

https://twitter.com/BigBiteNow/status/1308726119756169216?s=20

8/11
"If its in Africa."

Well the Eskom BESS project isn't just in Africa, it is where all BMN mines operate and their influence is greatest. So how active does that make BMN/BE?

In the 11th Nov interview Mikhail Nikomarov also went on to say ;

9/11
"So this integration allows us to capture value, sometimes from 4 or 6 activities on just one single project."

What he was talking about there was the value chain that BMN have spent these last few years piecing together, coupled with Bushveld Energy's management/inputs.

10/11
Meaning there are multiple ways that BMN can attack the Eskom Project, depending on the demands of tender.

What's key for me, is that for a VRFB to win this tender, it has to have BMN behind it, in some shape or form because they hold the competitive advantage, for many

11/11
reasons, some of which are highlighted above.

Meaning any BMN/BE backed VRFB tender, will highly likely be the best VRFB tender by some distance.

So it'll be about BMN/BE's vanadium JV vs lithium-ion and again, for reasons stated above, I really fancy their chances.