Ferro-Alloy Resources Ltd (LSE:FAR) has reported a 35% increase in the resource at its Balasausqandiq vanadium deposit in Kazakhstan
Balasausqandiq now has an estimated Indicated Mineral Resource of 32.9 million tonnes (Mt) in its ore body 1 (OB1) at a mean grade of 0.62% V2O5 (vanadium), equating to 203,364 contained tonnes of V2O5 at a 0.4% cut off.
Compared to a 2018 Competent Persons Report that represents an increase of 8.6 Mt (35.4%) of mineral resource and 38,058 tonnes (23%) of contained V2O5.
Infill drilling and trenching programs completed over the past two years converted 100% of the resources to the more certain Indicated category at OB1, the company added.
Ferro-Alloy said also that the feasibility study for Stage 1 of Balasausqandiq is expected to be completed in the final quarter of 2023 with Stage 2 to follow in 2024.
The 2018 CPR results indicated the production of 22,400 tonnes of vanadium pentoxide per annum (over 10% of current world supply), with an operating margin of almost 80% and a project Net Present Value of US$2bn.
The junior added that significant progress had been made over the past year even with the difficulties importing raw materials.
Group revenues in 2022 rose 28% to US$6.27mln (2021: US$4.73m), which was slightly below market expectations.
An overall loss for the year of US$4.29mln (2021: loss of US$2.83m), was mainly attributable to the difficulties importing raw materials during the period and higher input costs.
Cash in the bank was US$4.33mln at the end of December.
For the remainder of 2023. Ferro-Alloy expects prices to remain at current levels of around US$9.50/lb of vanadium pentoxide and US$24.3/kg of nickel
Molybdenum prices have come down from the exceptionally high levels of early 2023 but are expected to remain at current levels of around US$53/kg.
In the results statement, Nick Bridgen, Ferro-Alloy chief executive, commented: "The existing operation has been impacted by supply difficulties during 2022 but the plant is now fully developed and, with concentrates in good supply, we expect the existing plant to operate profitably from now on.
"I am also delighted to have received the updated MRE report from SRK which has shown some encouraging results at our OB1 deposit.
"We are reviewing the report and will provide shareholders with an update on 2 May 2023."