Ferro-Alloy shares decline amid "positive" feasibility study results

(Alliance News) - Ferro-Alloy Resources Ltd on Monday said the feasibility study on phase one of the Balasausqandiq vanadium deposit project offers "compelling economics".

Shares in the Kazakhstan-focused vanadium producer sank 45% to 8.20 pence on Monday afternoon in London.

Ferro-Alloy said results from the study indicate the project's potential to become "one of the largest and lowest cost vanadium producers globally".

The company reported "compelling economics", noting a net present value of USD748 million, coupled with a project internal rate of return of 22%.

It said funding required to enter production totals USD520 million, and reported bottom decile of industry cash operating costs, with "attractive by-product credit value upside".

Ferro-Alloy reported a vanadium pentoxide price forecast of USD8.67 per pound in 2029, rising to USD10.59 per pound in 2037 and thereafter.

The company also noted annual production of 8,500 tonnes of vanadium pentoxide, and 247,000 tonnes of carbon black substitute, along with a mine life of 20 years.

Ferro-Alloy said it is advancing discussions with financial institutions interested in providing debt and equity financing for the project.

"The positive results of the feasibility study show that Balasausqandiq has the potential to be the lowest cost primary vanadium producer in the world with a cash operating cost of USD0.36/lb net of by-products, with significant staged expansion potential, making it a highly attractive investment proposition," said Ferro-Alloy Chair and Vision Blue Resources Chair Mick Davis.

Davis was appointed chair of Ferro-Alloy Resources back in 2021, following Vision Blue Resources' investment in the company.

By Christopher Ward, Alliance News reporter

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