Firering Strategic Minerals plc (LON:FRG) Independent Non-Executive Director Vassilios Carellas caught up with DirectorsTalk for an exclusive interview to discuss Q4 phase commissioning target, stockpile status, crushing for aggregate, shifting from heavy fuel oil to coal gasification, Limeco quicklime demand, and market position.
Q1: Firering Strategic Minerals has provided an operational update stating that the Quicklime project is being fast-tracked. Are you confident about hitting the Q4 phase commissioning target?
A1: Yes, the project itself is quite well-advanced now and one of the key items to get to site was actually the big units that go with the coal gasification unit, those are now on site. The logistics around that and getting that shipped across Africa into Zambia and on site is now done.
So, in terms of getting that up and running and getting the first kiln commissioned by the end of this quarter, everything’s on track.
Q2: How much is already stockpiled for kiln feed?
A2: As you know, we’ve been crushing material for aggregate and at the same time, building a stockpile for the quicklime, for the kilns of limestone.
So, we’ve got currently around about 15,000 tonnes of material stockpiled and growing daily so as we’re crushing for aggregate, at the same time, we’re crushing and building up our limestone stockpile to feed the kilns.
Q3: You mentioned that you’re crushing for aggregate. How important is the aggregate crushing operation for cash flow, and is there room for growth?
A3: It’s obviously very important at this stage, primarily being that at the moment it’s one of the sources of revenue that we’ve got coming into the business, and it’s actually paying for everything that’s happening on site.
So, we’ve got local employees, as well as expatriates, who are all involved in the commissioning process so it’s very important in terms of paying for all that.
Q4: What advantages does the shift from heavy fuel oil to coal gasification bring?
A4: I guess the big advantage has been that we would have had to import the heavy fuel oil in from outside of Zambia and that would have come at a significant logistical as well as cost for the product.
The coal for the coal gasification units will be sourced down the road in country and the trucks bringing up the coal will be going back with aggregates.
So, it’s actually quite a good position to be in that the trucks are not coming up full and going back down full.
Q5: Just turning to the offtake discussions, could you update us on progress there and the demand for Limeco’s quicklime?
A5: We’ve got a pilot kiln going in the laboratory where we’ve been able to produce quicklime which models what the kilns would be doing and it’s this material that we’ve been now sending to interested parties.
The feedback so far has been very positive, certainly from a spec point of view, there’s been no problems and discussions are now advanced to putting in place term sheets.
So, it’s moving along and it’s quite advanced.
Q6: How might the up-and-coming mineral resource estimate affect Firering Strategic Minerals’ market position, do you think?
A6: Well, if anything, it’ll enhance it and make it better. As things stand with the current resource and the current eight kilns, we have a 30-year life, we think the resource is going to double.
So, we’ll definitely have the resource base there for future expansion and future. Definitely the resource is there, we just have now the comfort of knowing that we are able to feed the market and grow with the market with that resource base.
