According to Tony Hammond, a Peru transplant now living in Arizona, the history of

vanadium mining can be traced back to a couple of cold miners looking to stay warm
on the job.

“The interesting thing is Minas Ragra was discovered in 1905 by sheer accident,” said the
mining engineer and consultant about Peru’s largest vanadium mine. “My great-grandfather
and his colleague, who was a metallurgical engineer, sent workers to fetch
some coal because it’s very cold up there in the mountains of Peru. These workers took
some samples of what they thought was coal. They brought it to camp, and when they
started a fire with this material, it emitted toxic fumes and nearly killed them.”

The Minas Ragra mine was uncovered shortly thereafter, and was bought up by American
investors, kickstarting a vanadium rush in the South American country. Indeed, a January
1920 newspaper article published by The Register in Adelaide talks about the “immense
vanadium deposits of Mina Ragra,” noting that if it were to suddenly run dry, the growing
American auto industry would be crippled.

But Minas Ragra did run dry. One of the first industrial-scale vanadium mines put into
business, Minas Ragra once produced 52 percent of the world’s vanadium, dropping the
price of the metal from $4,792 per pound to a low $5.50 a pound. By 1955, however, the
resource was tapped out and the world was without an estimated 43,023 tonnes of vanadium
pentoxide.

Hammond estimates that total production of vanadium from the project would be equivalent
to $548 million in today’s markets.

Since the mine’s shutdown, no other large-scale vanadium projects have been placed into
operation in Peru, with vanadium exploration disappearing from the country for more than
60 years.

Hammond, who does mining consulting work for companies looking to start projects in
Peru, has compiled a report looking at the possibility of restarting vanadium mining in the
Cerro de Pasco region.

He believes the rise of mining companies interested in vanadium — such as Largo

Resources (TSX:LGO), which is working in Brazil — has helped boost interest in
uncovering one of the next large vanadium plays. Largo has been steadily increasing its
production output at its Maracas Menchen mine in Brazil, having shipped a total 1,140
tonnes of vanadium since it started.

“Once Minas Ragra was depleted, there was no follow up,” said Hammond. “Reusable
vanadium in renewable energy will put Largo Resources and other pure-play companies,
like in Australia and South Africa, at an advantage.”

Hammond says he would like to see a similar wave of investment return to Peru’s borders
and is hopeful that his report may spark renewed interest in the once-prolific vanadium
producer. Investors would do well to keep an eye on the region to see if his wish comes
true.