20th Jul 2016 09:01
LONDON (Alliance News) - W Resources PLC Wednesday said the La Parrilla mine in Spain will now produce significantly more tungsten than first thought, as the company implements a new plan that will lower mine strip ratios and mining costs whilst increasing production rates.
Initial operations and production are still expected to begin at La Parrilla in the fourth quarter of this year, as W Resources can utilise the existing facilities that are on site whilst it constructs its own.
The miner has been working on an optimised mine plan for the La Parrilla open pit to improve the economics of the project and the results forecast a huge rise in annual production. The processing plant, for example, will be twice as large in capacity than originally planned and finished in the middle of next year.
The larger plant will allow it to process 2.2 times more ore than what the original design would have allowed. The miner will now be able to process just under 2.0 million tonnes of ore each year compared to the previous estimate of only 875,000 tonnes.
As a result, annual tungsten concentrate production is expected to be over 92% higher at 2,500 tonnes from 1,300 tonnes. Notably, the higher feed rates come with a slightly lower grade of 0.121% tungsten trioxide compared to the original 0.135%.
Impressively, W Resources said the capital cost of the project is not expected to increase by any "material" amount as a result of the new plan, despite the significant impact it will have on the economics.
It will take six to 12 months for production to reach full capacity, suggesting the miner can hit that goal sometime between mid-2017 and late on in the year.
"Financing discussions are advanced to reach the production targets for 2016, which we expect to be financed by initial customer off-take contracts, and negotiations are progressing well with regard to financing the 1.95 million tonnes per annum development in 2017 by either a joint venture or a debt facility," said Michael Masterman, chairman of the company.
W Resources shares were trading up 5.1% to 0.415 pence per share on Wednesday.
By Joshua Warner; [email protected]; @JoshAlliance
Copyright 2016 Alliance News Limited. All Rights Reserved.
Related Shares:
WRES.L