Q3 2024 Production Results

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF THE MARKET ABUSE REGULATION (EU) NO. 596/2014 (INCLUDING AS IT FORMS PART OF THE LAWS OF ENGLAND AND WALES BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018 ("MAR").

24 October 2024

Ferro-Alloy Resources Limited

("Ferro-Alloy" or the "Group" or the "Company")

 Q3 2024 Production Results

Ferro-Alloy Resources Limited (LSE:FAR), the vanadium producer and developer of the large Balasausqandiq vanadium deposit in Southern Kazakhstan, announces the production results of the Group's existing operation for Q3 2024.

Q3 Production Results

*     partly contained in ammonium metavanadate

**   in ferro-molybdenum

*** in nickel concentrate

Commentary

As first announced in July, the Company undertook test processing of stockpiled nickel-rich residues held at the plant site during Q3. The nickel residues contained lower levels of vanadium than historic bought-in catalysts, resulting in 40.3% less vanadium production in Q3 than Q2, but this was offset by having minimal raw material costs.  Overall, molybdenum output remained consistent between the quarters. The metallurgical recoveries of vanadium and molybdenum from the nickel residues in the testing period did not sufficiently replicate the results achieved in the laboratory and the Company has decided to revert to the treatment of standard concentrate raw materials, although this decision might change in future when different metal prices prevail.  

Production of vanadium pentoxide for the year to date is similar to that of 2023 while molybdenum output has decreased by 21.9%, comparatively, mainly as result of metal content variations within the concentrates treated.

During Q3 2024 the average prices of vanadium pentoxide and molybdenum were US$5.3/lb (Q3 2023: US$7.4/lb) and US$51.2/kg (Q3 2023: 54.1/kg), respectively.

Production Outlook

Following the outcome of the commercial scale testing of the nickel-rich residues the Company has reverted to processing bought-in catalysts on a non-tolling basis.

The Company has sufficient catalysts for processing during Q4 2024 either already at the plant site or on order.

Research and development are ongoing to determine whether the Company can process the upgraded nickel concentrates to produce ferro-nickel.

Commenting on the production results, Nick Bridgen, CEO of Ferro-Alloy Resources said:

"Current trading conditions are difficult, but the operation continues to make a contribution to overheads whilst we complete the main project feasibility study."

ENDS

For further information, visit www.ferro-alloy.com or contact:

Notes to Editors

About Ferro-Alloy Resources Limited:

The Company's operations are all located at the Balasausqandiq deposit in Kyzylordinskoye Oblast in the South of Kazakhstan. Currently the Company has two main business activities:

a) the high grade Balasausqandiq vanadium project (the "Project"); and

b) an existing vanadium concentrate processing operation (the "Existing Operation")    

Balasausqandiq is a very large deposit, with vanadium as the principal product together with several by-products. Owing to the nature of the ore, the capital and operating costs of development are very much lower than for other vanadium projects.    

The most recent mineral resource estimate for ore-body one (of seven) provided an Indicated Mineral Resource of 32.9 million tonnes at a mean grade of 0.62% V₂O₅ equating to 203,364 contained tonnes of vanadium pentoxide ("V₂O₅"). In the system of reserve estimation used in Kazakhstan the reserves are estimated to be over 70m tonnes in ore-bodies 1 to 5 but this does not include the full depth of ore-bodies 2 to 5 or the remaining ore-bodies which remain substantially unexplored.  

The Project will be developed in two phases, Phase 1 and Phase 2, with Phase 1 treating 1.65m tonnes per year.

There is an existing concentrate processing operation at the site of the Balasausqandiq deposit. The production facilities were originally created from a 15,000 tonnes per year pilot plant which was then expanded and adapted to recover vanadium, molybdenum and nickel from purchased concentrates. 

The existing operation is located on the same site and uses some of the same infrastructure as the Project, but is a separate operation which will continue in parallel with the development and operation of the Project.