Share Name Share Symbol Market Type Share ISIN Share Description
Ferro-alloy Resources Limited LSE:FAR London Ordinary Share GG00BGDYDZ69 ORD NPV
  Price Change % Change Share Price Shares Traded Last Trade
  -0.05 -0.14% 36.70 8,075 16:35:26
Bid Price Offer Price High Price Low Price Open Price
36.00 37.40 0.00 0.00 0.00
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Mining 115
Last Trade Time Trade Type Trade Size Trade Price Currency
09:28:53 O 8,075 37.15 GBX

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Date Time Title Posts
16/7/201909:28FAR and away one of the best prospects out there119
31/5/201911:16WE ARE WATCHING YOU !1,194
09/11/201814:491St Aust Res Ltd (Sydney ASX) : CHART AND DISCUSSION THREAD (moderated)9
31/8/201609:26FAR to go-

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Ferro-alloy Resources Daily Update: Ferro-alloy Resources Limited is listed in the Mining sector of the London Stock Exchange with ticker FAR. The last closing price for Ferro-alloy Resources was 36.75p.
Ferro-alloy Resources Limited has a 4 week average price of 35p and a 12 week average price of 25p.
The 1 year high share price is 64p while the 1 year low share price is currently 23p.
There are currently 312,978,848 shares in issue and the average daily traded volume is 30,994 shares. The market capitalisation of Ferro-alloy Resources Limited is £114,863,237.22.
ntbb: Very valuable and scarce resources, current share price is dirt cheap
tim000: I've mentioned that FAR might benefit from a China effect (ie a boost in its share price due to producing outside China), which our one-time poster Ken Chung seemed to take offence at. This website (referred to before here, and which usefully shows the latest vanadium prices) mentions that vanadium prices are likely to move up on stockpiling, just as rare earths are being stockpiled. That might explain the current uptrend in the share price. And it should help with financing Phase 1 too. hxxps://
tim000: I've heard nothing in response to my email to the company. That's the first time this has happened to me. It is possible that the company is busy negotiating equity and debt funding, which would explain its silence. (That might also be a factor in the share price decline since listing.) Or of course they might just be poor at IR! I tend towards the former explanation.
tim000: Page 21 of this presentation confirms next year, and by implication after the initial ramp up of production is concluded. That further suggests H2 2020 for the next round of funding. This is the very definition of a buy and hold stock, so not worth worrying about short-term volatility in the share price. Most explorers are suffering a terrible time due to a lack of funding to advance to mining. I guess however the unique properties of this project will make it an exception. And it helps a lot that they are already generating cash, and are self-financing. hxxp://
tim000: I would have guessed the next funding round would be next year, maybe even towards the end of next year. But I'm only guessing. My reasoning is that they might want to complete the first ramp up of production before moving on to the next stage. Investors and debt providers would probably want to see some evidence that the business is (a) profitable and (b) competently managed, before they make a very substantial commitment. I think it is probably too early to be contemplating the share price at which new equity is raised. I agree that, medium-long term, this could turn out to be a very profitable investment indeed.
cyberbub: I'm wondering whether the (possible) support being seen around this level may indicate that the insiders know that the funding will be done around these share price levels rather than much lower? Who knows perhaps funding might even be at a small premium e.g. 30p? If the share price has the potential to hit £3 on a 5-year timescale then I would think the company won't be forced to issue equity at a knock-down price? Just my musings...
jailbird: hxxps:// A balanced article with risks highlighted. Not plain sailing as some like us to believe. There are risks along the way. Glad I found this as not aware of some of the info here erro-Alloy Resources (LON:FAR) is the first new mining company to float on the standard list this year and it has a dual listing on the Kazakhstan Stock Exchange. It is already generating revenues and the cash raised will help to increase production and generate some cash. Balasausqandiq is different to other vanadium projects because it is a sedimentary deposit with no iron included so the grades do not have to be as high as most rival projects in order to be commercial. Balasausqandiq is estimated to have more than 100 million tonnes of resource, but only limited work has been done with the feasibility including a figure of 24.3 million tonnes. That will last a long time even if phase 2 of the development is completed and production rises to 22,000 tonnes a year. Vanadium prices can be volatile and increased demand has sparked a recent price rise to $28/lb, followed by a sharp dip to around $16/lb in the middle of March. That still means that it is higher than March 2018 and double the levels for the previous nine years. A price of $7.50/lb is being used for long-term planning, but it is set to be higher than that in the medium-term. Steel demand is growing, and the Chinese authorities have raised tensile strength standards so more vanadium is being used. Steel uses around 90% of vanadium produced. On top of that is the potential demand for vanadium redox flow batteries for grid support. It is a type of battery that would be suitable for storing wind and solar energy. The placing price looks a little full, so it is not entirely surprising that the share price fell to 55.5p (54.5p/56.5p) on the first day. There appear to have been at least ten trades with a total value of just over £43,000. Two trades account for the majority of this. Ferro-Alloy will need to raise cash to start phase 1 of the full development and, although some will come from debt, a share issue is expected to raise around $27m (£20m) to contribute to the total cost of $100m. The volatility of the vanadium price could hamper this, depending on when the cash is required. It is also important to note that the processing operations have only been proved in a pilot plant and there could be problems with scaling up. Let the share price settle down before assessing the opportunity. ========== Ferro-Alloy Resources Ltd (FAR) Vanadium miner and processor ========== Standard listing Flotation date: 28 March 2019 Issue price: 70p Amount raised: £5.25m Expenses: £595,000 Market capitalisation: £219.1m Brokers: Shard Capital / Tengri Capital ========== What does it do? Ferro-Alloy is domiciled in Guernsey but its operating activities are in Kazakhstan and centre around the Balasausqandiq vanadium deposit in Kyzylordinskaya oblast in south Kazakhstan. The company floated on the Kazakhstan Stock Exchange in June 2017. On the Kazakhstan Stock Exchange website under the heading trades is the date 26/9/17, which suggests there has been little trading activity. Balasausqandiq is estimated to have more than 100 million tonnes of resource. As well as vanadium, this includes carbon, molybdenum, uranium, rare earths, potassium and aluminium. However, there are five ore bodies but only the first has been significantly explored, so the resource estimate in the feasibility study is 24.3 million tonnes. There is a concentrate processing pilot operation that is being used to test the proposed process to extract vanadium from the ore. The steel industry is the main user of vanadium, but that is likely to change because renewable energy sources that are intermittent, such as wind and solar, require energy to be stored and vanadium flow batteries are a likely candidate for this. Kazakhstan is a mining country, so infrastructure is good, and the project is near to a highway and electricity power lines. Ferro-Alloy is dependent on getting the government approvals and permits, although rules have been changed to attract more international mining companies. The risks in the prospectus state that taxation regulations are evolving which could lead to problems. However, Ferro-Alloy has negotiated a nil corporate income tax charge until 2026 and there are no property taxes until 2024. Taxes on mining profit are still payable, but royalties are relatively low because they are based on the value of what comes out of the ground and not end products. Balasausqandiq is currently producing 150 tonnes of V2O5 vanadium pentoxide and the plan is to expand this to 1,500 tonnes by the first quarter of 2020. This will take around one year. Longer-term, it is planned to increase production to 5,600 tonnes in phase 1 and then in phase 2 to 22,000 tonnes. Phase 1 is a $100m project with $14m funded from internal sources and the rest from share issues and debt. There is enough cash to finance the initial development until the second half of 2019. Phase 2 would take production to four million tonnes per annum. This is not expected to commence until 2022 and would cost $225m. Financials Small scale production is generating revenues and they have risen from $127,000 in 2015 to $1.13m in 2017. Overheads were much greater than any gross profit generated. In the nine months to September 2018, revenues were $3.26m and a pre-tax profit was declared. In that period, there was $1.09m of cash generated from operating activities but nearly all this was taken up by higher trade receivables. There was $274,000 in the bank at the end of September 2018 and NAV was $1.66m. The money raised in the flotation will fund expansion of the current operations and the initial costs of phase 1 of the mine. The total costs are $100m. A further $26m (£20m) will need to be raised via share issues, while $58m could come from debt and $14m from retained earnings. Phase 2 will cost $225m on current estimates and management believes that it can generate enough cash from sales to fund this. Of course, what cash is generated from operations will depend on the price of vanadium, but a conservative price level of $7.50/lb is being used in calculations. The costings assume everything goes to plan and the cash can be raised when required. Directors Nicholas Bridgen is chief executive and he has been a director since 2006. He trained as an accountant before going to work for Rio Tinto. He was finance director of Bakyrchik Gold, which had problems with its innovative extraction technology, and founder of Hambledon Mining. Annual salary: $240,000 Andrey Kuznetsov is director of operations. He has been a director of one of the main subsidiaries since 2006. He was chief executive of the Kazakhstan subsidiary of Alfa Bank in 1995-96 and then there is a ten year gap in his details. Annual salary: $160,000 Non-executive director Christopher Thomas is a former executive at advertising and marketing group BBDO and he was also a non-executive of Hambledon Mining. Annual fee $30,000 Non-executive director James Turian has an accounting and trust background and he has been involved with several mining companies. Annual fee: $30,000 Shareholdings The directors own nearly 43.2% of the company, with Nicholas Bridgen owning 20.7% and Andrey Kuznetsov 22.4%. The other major shareholders are Citadel Equity Fund with 13.4% and AM2 (Bermuda) Ltd with 4.99%. These shareholders maintained their stake at the time of the flotation.
jc2706: tsmith2, I agree that their goals are very attractive in the medium and (especially) long term and if they achieve them then this will be a valuable company (if they hit their long term goals then it will be a lot greater than £1bn). The primary reason I am cautious is the poorly managed IPO (the valuation was ridiculous in my opinion and the market doesn't tend to look that favourably on botched IPOs) plus the valuation is high for their current offering and seems to pretty much be factoring in the move to 1500 tonnes. If you consider that the Market capitalisation of Largo is currently £510m, or around 4 times as much as FAR, and yet produces about 10.5k tonnes V2O5 compared with the 1.5k tonnes that FAR are gearing up for. Yes, FAR is projected to have better margins but there is delivery risk to consider. I confess that I am not a particular fan of the CEO either, although give him his dues, he did get a resource to production which is something that an awful lot of CEOs fail to do. Finally (on the negative side!), I have seen so many companies come to the market with plans to do things in a timescale that fail to deliver which has left me somewhat jaundiced of promises. If you look at a company we both hold, SHG, for example the share price is still way under its float price many years ago and this is far from atypical (HMB is still way under in its current guise as ALTN). On the positive side, they already have a processing operation which is great and are achieving revenues. As such, gearing up to 1500t V2O5 will be lower risk than a greenfield operation. The cash flows that deliver will go a long way to achieving their development goals of the larger asset which should mitigate dilution. On the very positive side is the blue sky potential of the developments which are ideally positioned to take advantage of a VRFB revolution should it materialise (which I suspect is entirely possible) and their tier 1 asset will make them a force to be reckoned with in the market.
tim000: I started to acquire a holding here today (not all the transactions were sales). Given the medium-term prospects here, it's amazing that this board is so quiet. I guess the share price is going to be just as volatile as the price of vanadium. Moreover, my experience of these deep value mining stocks is that the share price often weakens upon listing, and buying momentum only builds once the mine nears significant cashflow. Of course, in this case the mine is already generating a small amount of cash, but real profitability is still up to a year away as I understand it. Nicholas Bridgen didn't have a lot of success with HMB, but the beauty with this mine of course is that they already have a successful mini-processing plant, so they have proven competence in developing operations. And of course it is extremely rare to be able to invest so cheaply in the world's lowest-cost producer. Surely the mkt cap is going to exceed £1 bn on a 5-10 year horizon? ie roughly a ten bagger from here.
robin_of_loxley: 13.03.2006 Empyrean Energy Maintains That Its Horizontal Drilling Of the Eagle North Well-1 Well in California Is A Good If Not A Conclusive Augury For A Commercial Discovery Share prices can be very volatile during drilling. As we never tire of saying, even with all the seismic in the world and access to previous drilling records, you never know if you have a commercial discovery until you drill. "Only Dr Drill knows" is the saying in the trade. To this should be added "you never know until you have drilled and tested a well". In recent months a couple of large companies who should know better have announced a discoveries that were not discoveries because on further testing they turned out to be non-commercial. Some smaller companies have drilled wells, said this looks interesting, and then taken the rig away to drill something else. Admittedly there is a worldwide shortage of rigs but, as they say in opera, it's not over until the fat lady sings or, in the case of the oil and gas industry, until a well has flowed commercial quantities of oil and gas. All this being said, it is a little surprising that the share price of Empyrean Energy saw a sharp drop when it announced there would be horizontal drilling on the Eagle North-1 well in California. The vertical well had already reached its target depth. The horizontal drilling might again turn out to be non-conclusive but, all other things being equal, it is a positive development rather than a negative one. Empyrean, which also has assets in Germany, has the right to earn a 38.5 per cent interest in the project by funding 55 per cent of the costs of the Eagle North-1 appraisal well. The well is operated by Australian firm Victoria Petroleum, which, like Empyrean, is quoted on London's Alternative Investment Market. For Vicpet, the Eagle North-1 well is a bit of unfinished business. The Eagle Oil Pool was discovered in 1986 by the Mary Bellocchi-1 well in which Victoria Petroleum was a participant. That hole flowed up to 223 barrels of oil per day and 0.7 million cubic feet of gas per day from the Gatchell Sandstone during testing but, at the then prevailing oil price of US$11 a barrel, was considered uneconomic. In 2001 the Eagle-1 horizontal re-entry of Mary Bellocchi-1 found 90 metres of gross target sands in the Gatchell Sandstone reservoir before being lost due to mechanical problems. In May 2004 a 14 km seismic strike line was acquired to further define the updip extent of the Eagle Oil Pool. The Eagle North-1 appraisal was drilled 400 m north of the original Mary Bellocchi-1 well. In February 2006, the partners announced that preliminary analysis of the wireline logs of Eagle North-1 indicated oil saturation in the target Gatchell sands over a 21 metre gross interval from 4,136 metres to 4,157 metres with net pay of 7 metres. Wireline logs also indicated that the top of the Gatchell sand drilled in Eagle North-1 was at the same level as seen in Mary Bellocchi-1, thus providing further support for the interpreted presence of a commercial Eagle Oil Pool in a potential stratigraphic trap. Then last week, the partners announced they were preparing to drill a horizontal well towards the lower Gatchell oil sands that produced oil during testing of the Mary Bellocchi-1 well. The horizontal well will drill laterally through 300 metres (within a vertical column of 15 metres) of lower Gatchell oil sands to determine the potential horizontal flow rate. So what does this mean exactly? In blunt terms, it means the companies are trying to shorten the odds against failure. By drilling horizontally, they are increasing the area exposed to production casing (from 21 metres to 300 metres). The Mary Bellocchi –1 well flowed at 223 bpd and there were 90 metres of gross pay in the re-entry. So, in theory, it could flow at three times that: perhaps 600 barrels of oil plus some gas. Or the well might find non-commercial amounts of oil and gas even if the partners can overcome the problems of formation damage. The horizontal drilling should take ten days – that was last week so investors don't have much longer to wait.
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