Strategic Minerals PLC (AIM: SML) has secured $9.25 million of US government funding for its Redmoor tungsten-copper-tin project in Cornwall, accelerating work towards full feasibility and a potential final investment decision.
The funding has been awarded to wholly owned subsidiary Cornwall Resources Limited and is non-dilutive, with no restrictions on future funding or offtake agreements. Combined with Strategic Minerals’ existing cash resources, it will allow Redmoor to move beyond the previously planned pre-feasibility stage and into a full definitive feasibility study.
The programme will fund resource infill and expansion drilling, geotechnical and metallurgical work, Mineral Resource updates, Reserve conversion, PFS and DFS studies and pre-site development activities aimed at accelerating the route towards underground mining.
The investment will support an engineering programme consisting of:
- ongoing resource infill and expansion drilling, as well as geotechnical and metallurgical drilling, and other site investigations for feasibility studies;
- Mineral Resource Estimate updates and subsequent Reserve conversion;
- prefeasibility and definitive feasibility studies;
- metallurgical, processing and engineering studies; and
- pre-site development activities aimed at fast tracking the route to underground mining.
Strategic Minerals is targeting completion of the technical and commercial work required to reach a final investment decision within 32 months of the agreed programme start date. The programme does not, however, include completion of the planning and permitting process required for a mine.
The award is being made through the US government’s Industrial Base Analysis and Sustainment programme and the Defense Industrial Base Consortium, using a prototype Other Transaction structure rather than a conventional grant or procurement contract.
The $9.25 million contribution is being provided on a firm fixed-price, cost-shared basis, with remaining programme costs to be met by Strategic Minerals through cash and, if secured, additional UK grant funding. Payments will be made in arrears after agreed project milestones are completed.
The company and US authorities will now finalise a Project Execution Plan covering delivery milestones, payment schedules, reporting and cost-sharing arrangements, with that process expected to take around 60 days.
Strategic Minerals said the investment reflects the strategic importance of Redmoor to Western tungsten supply chains, with the project positioned as a potential future source for US and allied defence, advanced manufacturing and critical-mineral markets.
For investors, the significance is that a substantial portion of Redmoor’s feasibility-stage development is now supported by non-dilutive external funding, reducing the risk of further equity issuance simply to reach DFS. The next major milestones are completion of the execution plan, continued drilling and resource conversion, and delivery of the PFS and DFS. Any eventual mine development would still require permitting, a positive investment decision and separate construction financing.
Investor takeaway: Strategic Minerals has secured $9.25 million of non-dilutive US government funding for Redmoor, materially reducing funding risk through the project’s feasibility stages. The programme is designed to take Redmoor through PFS, DFS and towards a final investment decision within 32 months, although mine construction, permitting and any follow-on development funding remain outside the current award.
