TIDMWRES
RNS Number : 4825X
W Resources PLC
05 January 2022
5 January 2022
W Resources Plc
("W" or the "Company")
La Parrilla Update and Placing for GBP0.83m
W Resources Plc (AIM:WRES), the tungsten, tin and gold mining
and exploration company with assets in Spain and Portugal,
announces:
-- An update on production at the La Parrilla tungsten and tin mine in Spain; and
-- Completion of a placement of 13,888,889 ordinary shares of
0.1p per share ("Ordinary Shares") at 6p per Ordinary Share with
offtake partner, ICD Alloys & Metals LLC ("ICD") and Symmall
Pty Limited to raise a total of circa GBP0.83m (the "Placing").
Production Guidance
Q3 2021 was W's best performing quarter, however the Q3 2021
production report outlined a number of challenges that were
adversely impacting production and unfortunately, a number of these
challenges continued throughout Q4 2021.
Heavy rains in December led to production stoppages caused by
wet crushed ore blocking the silo. This was compounded by only
having access to mid to low-grade ore, associated maintenance
issues and supply chain bottlenecks for replacement parts. All of
these challenges negatively impacted production during Q4 2021.
However, were it not for these challenges, the Company believes
production would have been very close to the lower end of the
previous production guidance issued.
As a result, the Company now has to adjust full year guidance to
520t of tungsten and tin concentrate compared to previous full year
production guidance of between 650t and 750t of concentrate. The
Company expects to issue a Q4 2021 production report later this
month.
The Company expects production in Q1 2022 to improve
significantly as:
-- The open mine pit has been drained of water which is giving
access to higher-grade ore bodies
-- The crushed ore stockpile area is expected to be finalised by the end of January 2022
-- Improved maintenance solutions have now been implemented
-- Spare parts stock is being built up again to avoid future bottlenecks
Placing
The challenges encountered in Q4 2021 led to unexpected pressure
on cash flow and the Company is delighted by the support from
offtake partner ICD which joins W's share register with an
investment of GBP778,227 in addition to a further GBP55,106
investment by Symmall Pty Limited, as trustee of the Masterman
Superannuation Fund of which Mr Michael Masterman (Chairman of the
Company) is both a beneficiary and trustee, which has subscribed
for 918,434 Ordinary Shares on the same terms as ICD. The Placing
is at a 26.3% premium to the Company's share price as at 31
December 2021.
ICD the Company's offtake partner for tungsten concentrate is
supportive of the Company's development and is showing a great deal
of confidence in the Company and the potential of the mine at La
Parrilla due to the quality of concentrate W has delivered to
date.
Michael Masterman, Chairman of W Resources , commented: "A
number of challenges encountered towards the end of 2021 have
resulted in a much lower performance than we had envisaged. Once
again the management team at La Parrilla have overcome these
challenges and as we start to mine and process higher-grade ore we
are seeing increased levels of production, higher recovery rates
and increasing utilisation rates. Lower than expected production
levels have put some stress on the Company's cash flow. I am
therefore delighted with the support being offered to us by ICD
."
Steve Conlin, President of ICD , commented "ICD are thrilled to
be able to invest in the La Parrilla mine in Spain, one of the
brightest and most attractive conflict free tungsten and tin mines
in production today. We look forward to increasing the supply to
our global customer base as we increase both quality and production
volumes. Tungsten is a very strategic metal and is a major part of
the ICD portfolio of strategic defence and high-tech business
applications. As a distributor we understand the time it takes to
bring a mine into full production and after a number of issues with
both plant and access to ore we believe the Company is now at a
stage to step up its production. We are excited to become a
significant shareholder and participate and contribute towards the
Company's growth. We look forward to revisiting the mine and to
continue developing our relationship with the Company and its
management team."
Related Party Transaction
The participation in the Placing by Symmall Pty Limited falls to
be treated as a related party transaction under Rule 13 of the AIM
Rules for Companies. The independent W directors, being the W
directors other than Mr Michael Masterman consider, having
consulted with the Company's nominated adviser Grant Thornton UK
LLP, that the terms of the share subscription by Symmall Pty
Limited are fair and reasonable insofar as the Company's
shareholders are concerned.
Settlement and Dealings
Application has been made for the 13,888,889 Ordinary Shares
being issued in connection with the Placing to be admitted to
trading on AIM ("Admission"), with Admission expected to occur on
or around 11 January 2022.
Total Voting Rights
Following Admission, the Company's enlarged issued share capital
will comprise 146,947,146 Ordinary Shares with voting rights. The
Company has no shares held in Treasury. This figure of 146,947,146
Ordinary Shares may be used by shareholders in the Company as the
denominator for the calculations by which they will determine if
they are required to notify their interest in, or a change in their
interest in, the share capital of the Company under the FCA's
Disclosure Guidance and Transparency Rules.
The information contained within this announcement is deemed to
constitute inside information as stipulated under the retained EU
law version of the Market Abuse Regulation (EU) No. 596/2014 (the
"UK MAR") which is part of UK law by virtue of the European Union
(Withdrawal) Act 2018. The information is disclosed in accordance
with the Company's obligations under Article 17 of the UK MAR. Upon
the publication of this announcement, this inside information is
now considered to be in the public domain.
Enquiries:
W Resources Plc Grant Thornton UK LLP
Paul Hailes Colin Aaronson / Harrison Clarke
investor@wresources.com T: +44 (0) 20 7383 5100
www.wresources.com
Broker Alma PR
Alternative Resource Capital / Justine James
Shard Capital M: +44 (0) 7525 324431
Alex Wood wres@almapr.co.uk
T:+44 (0) 207 186 9004
www.altrescap.com
Damon Heath
T:+44 (0) 207 186 9952
www.shardcapital.com
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END
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