bfs is 3 months overdue, page-3

Yes, the BFS has not appeared when some of us hoped (though there has never been a committed date, as far as I know). But what has happened in the meantime? Are we looking at the same situation in the graphite market as was the case a year ago?

We are watching a quiet revolution, and the BFS has to reflect the new reality. Balama, and its sheer size, has caused two things to happen:

First, the graphite price has dropped. That's something the smaller prospectors are reluctant to admit, but it's a fact, and all the indications are that it's not going to rise again anytime soon. (Hard times ahead, if you're trying to run a mine with production costs of $700 per tonne or more)

Second, the nature of the market has changed. The recent huge sale to Chalieco - 80K to 100K tonnes per year, the largest order in graphite mining history - involves a major new application for the mineral. Graphite miners are going to have to adapt to the reality, increase volumes, and reduce costs, to survive in this environment.

So it seems eminently reasonable that the BFS should be geared to this changed market picture.

The likelihood of significant volume increases also changes the vanadium side of the BFS. On current prices, we can say roughly that each tonne of graphite from Balama comes with about $300 worth of vanadium. As the graphite sales volume rises, so does the profit contribution from that metal, which strongly supports Cdchi1's suggestion that vanadium will be part of the product mix, from very early on.

So why are we still waiting for the BFS? Most likely, because it is being revised as we speak - in just the nicest way!

Cheers, Prime1