Key Highlights

  • Element 25 reported that early works commenced in September 2026 at the Butcherbird Expansion Project in Western Australia.
  • Closing cash was A$9.83 million at 30 September 2026, compared with A$18.28 million at the start of the quarter.
  • The company reported a binding NAIF agreement for up to A$50.0 million and an offtake agreement with OM Materials, both subject to conditions.

Element 25 (ASX:E25) released its Quarterly Report for the three months to 30 September 2026 on 23 October. The report covers the start of early works at the Butcherbird Expansion Project in Western Australia, which the company is planning as a manganese concentrate operation of 1.1 million tonnes a year, based on a feasibility study published in January 2025. The report states an Ore Reserve of 101.4 million tonnes at 10.4 per cent manganese, supporting a mine life of more than 18 years at the planned rate.

Early works commenced in September 2026. The company listed site clearing and bulk earthworks, a new process water pond with pumping and pipelines, relocation of bore field connections and administration facilities, and eventual decommissioning of the existing process water pond once the new one is commissioned. Tenders for the main construction packages, covering concrete, structural, mechanical and piping work and electrical and instrumentation work, are described as well advanced. Awards are expected in line with the project plan, with no date given.

Cash spent on property, plant and equipment was A$7.57 million in the quarter, taking net investing outflows to A$7.73 million. Net operating outflow was A$711,000, and closing cash was A$9.83 million, compared with A$18.28 million at the start of the quarter. The company has no borrowings or undrawn facilities. The Appendix 5B estimates 13.81 quarters of funding at the current operating burn rate, before the construction spending ahead.

Offtake agreement

Element 25 said its Subsidiary Butcherbird Operations has signed an offtake agreement with OM Materials (S), a subsidiary of OM Holdings (ASX:OMH), covering 100 per cent of Butcherbird concentrate up to about 1.1 million tonnes a year on a take-or-pay basis. Limited carve-outs apply for non-conforming material and the company's own Downstream manganese sulphate needs. The buyer holds exclusive global Marketing rights for conforming product. Pricing is linked to international manganese ore benchmarks, with quality adjustments, periodic reviews and freight normalised to free on board.

The term is five years from first shipment, with an option to extend by up to five years subject to performance and review. The agreement is conditional on board approval, financing becoming unconditional and regulatory approvals. No Revenue has been recognised under the agreement, and no first shipment date was given.

Project finance and Louisiana

In September the company executed a binding agreement with the Northern Australia Infrastructure Facility for up to A$50.0 million, comprising a A$42.5 million term facility with an 11-year tenor and a A$7.5 million cost overrun facility with a three-year tenor, both measured from financial close. It is available only once conditions precedent are satisfied or waived. Outstanding conditions include implementing the finance and security structure, establishing project accounts, meeting compliance deliverables and confirming committed funding for completion. No drawdown has occurred.

In the United States, Element 25 (ASX:E25) reported a revised US Department of Energy grant agreement of US$166 million, about A$268 million, for its planned high-purity manganese sulphate facility in Louisiana. Terms were first agreed in July 2026, with finalisation still to come. The company said it is reviewing and repositioning that facility for market conditions and battery chemistries, and said it would provide further updates.

Conditions and next milestones

The report lists several dependencies: the NAIF conditions, the offtake conditions, the construction contract awards and finalisation of the grant. It reports no drilling results.

The company listed its next milestones as award of the main construction contracts, completion of early works, satisfying or waiving the NAIF conditions with financial close and first drawdown, fulfilling the offtake conditions, commissioning the new process water pond, recommencing production at Butcherbird and first shipment. Most have no stated date.