Aim-listed Bushveld Minerals recorded record quarterly production of 498 t of vanadium from the Vanchem operation, in Mpumalanga, South Africa, for the three months ended March 31, as well as record monthly production of 200 t from the same operation in March.

The company’s overall production for the first quarter of the year was 855 t of vanadium, compared with the 943 t of vanadium produced in the first quarter of last year.

The Vametco operation, in South Africa’s North West province, produced 357 t of vanadium in the quarter under review.

Groupwide sales in the reporting quarter amounted to 880 t, compared with 1 028 t of vanadium sold in the prior corresponding quarter.

The Vanchem operation achieved the record production performance, as well as a 25% reduction in unit cash costs, in the quarter despite 11 days of production having been lost in January owing to delayed settlement of funds.

Acacia Resources, which subscribed to 92.5-million shares in Bushveld in last year, was due to settle its subscription of $3.5-million on or before February 28, but Bushveld has not received this amount. Acacia is therefore in breach of the terms of the subscription letter which it signed with Bushveld in November last year.

Bushveld has instructed its lawyers to start legal proceedings against Acacia.

As a result of the delayed funds, including a delay in proceeds to be received from Southern Point Resources (SPR), Bushveld’s Vanchem and Vametco operations both suffered production impacts.

Bushveld entered into a definitive agreement for the sale of 50% of Vanchem business to SPR for $21.3-million in November, as well as the sale of a 64% interest in a subsidiary that owns the Mokopane vanadium project, in Limpopo, South Africa, for $3.7-million.

Bushveld initially expected the South African Competition Tribunal to approve the deal in February; however, it is now expected to be approved in July or later.

Following the approval, the sale of the Vanchem and Mokopane interests can be completed.

Bushveld has advised that its working capital position is “extremely tight”, with its cash balance totalling $2.2-million on April 21. Vanadium prices are also lower than Bushveld expected, which further tightens the company’s cash position.

Ferrovanadium prices averaged $28.4/kg in the quarter under review, compared with an average price of $31.6/kg in the fourth quarter of last year.

Should further funding not be secured in coming weeks, Bushveld would have to suspend some of its operations.