Low-cost vanadium producer emerging in Kazakhstan

The Ferro-Alloy Resources Group (“FAR”) is developing the giant Balasausqandiq vanadium deposit in Kyzylordinskaya oblast of southern Kazakhstan.  The ore at this deposit is unlike that of nearly all other primary vanadium deposits and is capable of being treated by a much lower cost process. It is planned that output will be increased in stages to reach 22,400 tonnes of vanadium pentoxide per year, mostly in the form of ferro-vanadium.

FAR is already in production processing purchased vanadium-containing secondary materials to produce vanadium in the form of ammonium metavanadate (“AMV”). FAR currently installing equipment which will enable it to increase production and convert its AMV into the more commonly traded vanadium pentoxide.

“The development of Balasausqandiq is going to transform the world of vanadium.  We can meet the rapidly expanding demand from battery storage as well as for the steel industry faster, at a fraction of the capital costs per annual tonne, and at a far lower cash production cost than any existing or planned vanadium producer,” said Nicholas Bridgen, CEO.

The expansion of production capacity to around 1,500 tonnes of saleable vanadium product per year is proceeding as planned. Some significant infrastructure upgrades have been completed and others are continuing and we have completed the installation of equipment to increase production capacity, convert AMV into vanadium pentoxide and produce ferro-molybdenum.

The prices of vanadium pentoxide, molybdic oxide and ferro-molybdenum rose by 63%, 109% and 83% respectively in the past year, underlining its confidence in the long-term prospects for the Company’s products.

The investment climate in Kazakhstan continues to further improve with the country receiving US$3.9 billion in foreign direct investment last year driven by growing investment in mining, transport, financial services, telecommunications and energy.

During the period ended 30 June 2021, production of vanadium pentoxide (V2O5) amounted to 88.2 tonnes, 9% below the corresponding period in 2020. The decline was caused by interruptions in the supply of vanadium concentrates caused by Covid-19 restrictions and a worldwide shortage of containers. From June 2021, supplies have started flowing normally and more than usual stocks have now been received to allow production to return to normal. 25.3 tonnes of calcium molybdate was produced in the period, compared with none in the first half of 2020 as production only started in the second half of 2020.

Looking further ahead, the Company is procuring an electric arc furnace which can further double production capacity. This furnace will be used to produce ferro-vanadium directly from raw-material concentrates without first producing vanadium pentoxide, and it will also be used for the production of by-product ferro-nickel, a higher value product than the low grade concentrate currently being sold.

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