[Ferro-Alloys.com] Kazakh vanadium producer sets sights on the US defense sector

U.K.-based Ferro-Alloy Resources, which is developing the Balasausqandiq vanadium deposit in Kazakhstan’s Kyzylorda region, has submitted applications for funding from U.S. government agencies and has begun exploring the extraction of the rare earth element yttrium as a potential byproduct. The company disclosed the plans in a strategic update published on the Astana International Exchange (AIX).

U.S. funding and strategic partnerships

The company said it is in discussions with several U.S. government agencies interested in securing supplies of critical minerals. Ferro-Alloy Resources has submitted initial applications for grant funding, as well as preferential debt financing and equity investment.

Additionally, the company is exploring options with potential partners to integrate its ferrovanadium production into U.S. metals and defense supply chains. The discussions include potential partnerships, mergers and other forms of strategic collaboration.

Yttrium could become a valuable byproduct

Rare earth production represents another potential growth opportunity. Ferro-Alloy Resources has launched research into extracting yttrium from ore at the Balasausqandiq deposit.

The deposit reportedly contains approximately 100 grams of yttrium per ton of ore, while yttrium oxide currently sells for about $1,200 per kilogram outside China. Based on those figures, the company estimates the potential value of the deposit’s yttrium reserves at approximately $4.57 billion. It noted, however, that the project’s ultimate economics will depend on metal recovery rates and processing costs.

Production expansion

Separately, Ferro-Alloy Resources is expanding its existing operations.

The company said it has received a preliminary order for 20 tons of its carbon black substitute from an agricultural tire manufacturer and is continuing product testing with Master Tyre for use in passenger vehicle tires.

At its existing processing facility, the company has upgraded its technology for recycling vanadium-bearing catalysts, increasing production capacity by about 58%.

Furthermore, Ferro-Alloy Resources received a $500,000 grant from the Kazakhstan Science Fund and signed prepayment agreements worth $2 million for future deliveries of vanadium and molybdenum products.

Project ownership

The Balasausqandiq deposit is one of the world’s largest vanadium projects.

According to the project’s previously published feasibility study, its net present value is estimated at $748 million. Following a preliminary revision of capital expenditures, that figure could increase to $932 million.

Ferro-Alloy Resources’s largest shareholder is Vision Blue Resources Ltd., a private investment fund that owns a 22.5% stake. Andrey Kuznetsov, the company’s chief operating officer and a key executive overseeing the Kazakhstan project, holds 12.1% of the shares, while Nick Bridgen, chief executive officer, owns 10.7%. The remaining shares are held by private investors and are publicly traded.

• [Editor:tianyawei]