Ferro-Alloy Resources Limited (LON:FAR), known for its vanadium production and development of the Balasausqandiq vanadium deposit in Southern Kazakhstan, has provided an update on its carbon black substitute (CBS) product following the completion of a new marketing study.
The study, conducted by Smithers, has estimated that the CBS product could be priced at around US$500 per tonne in the tyre market and between US$550 and US$600 per tonne in the non-tyre market. This estimation follows tests that demonstrated the CBS product’s ability to replace traditional carbon black in rubber formulations, such as for passenger vehicle tyre sidewalls.
Significant research from SGS Canada has shown that CBS can be extracted from the tailings of the vanadium processing plant using flotation methods, yielding up to 220,000 tonnes of CBS annually. This could result in gross revenue exceeding US$110 million for the first phase of the Balasausqandiq project. The CBS product is expected to be economically shipped to markets like Western Europe and China, with further investigation into nearby regions for potential opportunities.
In terms of sustainability, the CBS product presents a significant advantage. Initial research suggests that the carbon dioxide equivalent (CO2e) emissions for CBS production could range from 0.36 to 0.6 tonnes per tonne of CBS, compared to the 2 to 5 tonnes of CO2e per tonne typically associated with standard carbon black. This lower environmental impact is expected to provide a strong marketing advantage, especially as more industries seek to reduce their carbon footprint.
Ferro-Alloy’s CEO, Nick Bridgen, highlighted the immense value of the CBS product, noting that its revenue potential could rival that of the company’s main vanadium product. He also emphasised that the relatively low production costs of CBS, combined with the added sustainability benefits, significantly enhance the project’s overall value.
The company has now begun marketing efforts for the CBS product, exploring commercial opportunities and potential offtake agreements. As Ferro-Alloy’s Balasausqandiq deposit is expected to be the world’s lowest-cost primary vanadium producer, the CBS co-product extracted from the vanadium tailings further strengthens its competitive position.
The CBS product is made by concentrating naturally occurring carbon from the waste produced by the Balasausqandiq ore processing. This method stands in stark contrast to the traditional carbon black production process, which involves the combustion of hydrocarbons and results in higher emissions and production costs. The CBS product, on the other hand, benefits from a simpler, lower-cost production process that produces fewer emissions, aligning with global efforts to reduce carbon footprints.
The global carbon black market, valued at approximately US$20 billion annually, is dominated by its use in tyre manufacturing. Many tyre manufacturers are striving to lower the carbon emissions associated with their products and are investigating alternatives like recovered carbon black. Ferro-Alloy’s CBS product, with its reduced emissions and sustainable production process, positions the company well to meet the growing demand for environmentally friendly materials.
Ferro-Alloy Resources’ CBS product offers a promising new revenue stream and a strong market advantage, driven by its low production costs, sustainability credentials, and growing market interest in reducing carbon emissions. The ongoing development and marketing of this product highlight the company’s forward-thinking approach to expanding its product portfolio and enhancing its competitive position in the global market.
Ferro-Alloy Resources Ltd (LON:FAR) is developing the giant Balasausqandiq vanadium deposit in Kyzylordinskaya oblast of southern Kazakhstan. The ore at this deposit is unlike that of nearly all other primary vanadium deposits and is capable of being treated by a much lower cost process.
