(Alliance News) - Vanadium miner Bushveld Minerals Ltd on Monday said it is keeping its production guidance for 2020 under review, as first quarter output rose marginally.
Bushveld, which owns the Vametco mine in South Africa, produced 652 metric tonnes of vanadium from the project in the three months to March 31, slightly higher from 649 metric tonnes the same period a year before.
Sales of Vametco vanadium were at 898 metric tonnes, a 77% increase from the prior year, as a result of additional production volumes in the fourth quarter of 2019 as well as increased customer demand.
Meanwhile, the Vanchem project produced 219 metric tonnes of vanadium, despite the effect of 10 days of power rationing as well as the Covid-19 lockdown. Meanwhile, there were sales of 182 metric tonnes achieved during the quarter.
Operationally, Bushveld completed the scoping study of a refurbishment programme, and has prioritised a total of ZAR85 million, around GBP3.6 million, as critical capital spend required for 2020 to allow Vanchem to continue operations.
Bushveld has received approval for the construction of a vanadium electrolyte plant, including the receipt of funding approvals for equity and debt from the Industrial Development Corp in South Africa.
Looking ahead, 2020 production and cost guidance for both Vanchem and Vametco remains under review and will remain so until the company is in a position to judge the effect of Covid-19 and the lockdown, it said.
"This update comes in the midst of the global Covid-19 pandemic that has not only changed our world but will continue to change it in ways we have not fully understood yet. I am pleased that these difficult circumstances found Bushveld Minerals in a sound state financially, with a set of quality low-cost production assets," said Chief Executive Officer Fortune Mojapelo.
"We are fortunate to operate in a country whose leadership has taken early decisive action to limit the spread of the Covid-19 virus while ensuring that we build the necessary public health care capacity and identify fiscal responses to manage the coming wave of infections, while treatments and vaccines are still under development," Mojapelo added.
Shares in Bushveld Minerals were down 5.3% to 12.19 pence on Monday in London.
By Dayo Laniyan; dayolaniyan@alliancenews.com
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Bushveld Minerals (BMN)