Ferro-Alloy Resources Limited (LON:FAR), the vanadium producer and developer of the large Balasausqandiq vanadium deposit in Southern Kazakhstan, has announced its interim results for the six months ended 30 June 2023.
Overview
Feasibility Study
· Feasibility study ongoing with completion of Stage 1 of the study expected in April 2024 and Stage 2 later in 2024:
o Ore resource for ore-body 1 was revised upwards during the period by SRK Consulting (Kazakhstan) to 32.9m tonnes at a mean grade of 0.62%, giving an increase of 35.4% in the resource and 23% in contained V2O5.
o Drilling of ore-bodies 2, 3 and 4 has been completed with the exception of an area which is difficult to access. The Company is awaiting assays for these ore-bodies which are expected to provide the feed for the larger Stage 2 development of the deposit.
o Metallurgical test-work is nearing completion.
Operations
· Final planned improvements completed at the Existing Operation (where the Group processes secondary materials and recovers the contained vanadium, molybdenum and nickel for sale to third parties) including:
o The conversion of the fuel used for the various roasting ovens from diesel to natural gas.
o A further press filter and tanks to allow a second pulpation process to give a further recovery of vanadium.
o A further press filter and tanks to allow for recrystallisation of ammonium metavanadate, an essential step in producing a high purity product as required for electrolyte purposes.
o Improved molybdenum processes to increase recovery to around 90% depending on the raw-material treated.
o Various additional equipment to contain production emissions.
· Following poor availability of concentrate supply in Q1, Q2 achieved best production by the Group to date in terms of both tonnes of concentrates treated and tonnes of metal recovered across all product lines, however, H1 production constrained by a lack of raw materials caused by continuing defaults of certain of the Group’s suppliers.
· The Group has subsequently made changes to suppliers and has secured future deliveries to allow full production from mid-late September 2023.
Financial
· Total revenues of US$3.3m for the period (H1 2022: US$3.9m) reflecting the reduced volumes of raw materials delivered to the existing plant for processing during the first quarter of the year.
· Overall loss for the period of US$1.5m (2022: loss of US$0.7m).
Corporate
· Post period, launched the first tranche of a new Kazakhstan exempt offer bond programme in July 2023. The proceeds of the Programme will be used to strengthen the Company’s balance sheet and provide working capital, allowing the acceleration of the project’s development as far as possible.
Commenting on the interim financial results, Nick Bridgen, CEO of Ferro-Alloy Resources said:
“I am pleased to report the good progress with the feasibility study. With the completion of the expansion of the existing process plant, and the improved raw-material supply position, I look forward to much better operational performance from the fourth quarter of this year onwards.”
