Development of the Balasausqandiq deposit

The Balasausqandiq deposit is a very large black-shale deposit containing vanadium and valuable by-products - uranium, molybdenum, aluminium, rare earth metals and carbon.  This deposit is unlike the vast majority of other vanadium deposits, either in production or proposed, in that it is not comprised of vanadiferous titano-magnetite and is amenable to a processing method which is much lower in both capital and operating costs.

Only the first (of five known) ore-bodies has been explored to full depth, giving a reserve of 23 million tonnes. It is considered likely that after full exploration of the other ore-bodies, the Balasausqandiq deposit will be large enough to eventually support an operation of up to 10 Mtpa of ore, producing about 55,000 tonnes of vanadium pentoxide per year. However, to avoid oversupply to the market, engineering risks, and to reduce shareholder dilution, FAR plans to develop more slowly, in steps that are more in tune with both the natural expansion of the vanadium market and at a pace which allows the later stages to be substantially financed from earnings of the earlier stages. This relatively slow development plan can be revised if there is a significant increase in demand, for example, for vanadium flow batteries for energy storage.

A two step development is currently planned, starting at 1 Mtpa (Phase 1) and rising  to 4 Mtpa (Phase 2). Vanadium pentoxide production from 1 Mtpa will be about 5,600 tonnes per annum and 4 Mtpa would produce an additional 16,800 tonnes – less than the predicted growth of the market in the meantime.

The 1 Mtpa expansion followed by a 4 Mtpa expansion is an integrated plan aimed at limiting financial, engineering and market risk, whilst still benefiting from the economies of scale of the large deposit size. Further expansions beyond the current plans are highly likely.

A Feasibility Study into the Phase 1 development has been carried out under the local Kazakhstan required standards. This study involved the full exploration of ore-body 1 which contains reserves of 23m tonnes, and the operation of a pilot treatment-plant which produced some 20 tonnes of V2O5 which was sold commercially. This study is currently being updated to Western standards and expanded to include Phase 2, with completion expected in the second half of 2022. As part of this study, further exploration drilling is being carried out with a view to establishing a reserve sufficient to give a reasonably long mine-life at the Phase 2 treatment rate of 4 million tonnes per year.