W Resources Plc (AIM:WRES), the tungsten, tin and gold mining company with assets in Spain and Portugal provides the following update on the Plant Improvement Programme at the La Parrilla Mine in Spain, which has now been successfully completed:
· Improved efficiency and increased production of tin and tungsten concentrate
· Concentrator plant recovery for tungsten during February was greater than 60% – an all-time high
· Despite unprecedented rainfall which has slowed Q1 progress, tungsten and tin concentrate production in Q1 and Q2 2021 is expected to be ahead of any previously reported quarter
· Two shipments of 20t of tungsten concentrate completed and shipped in the past 2 months
· One shipment of 20t of tin concentrate was shipped on 1 March and this shipment benefited from a 26% increase in the net price received vs the previous tin shipment.
· One shipment of 20t of tungsten concentrate is due to be shipped on 8 March 2021
The Plant Improvement Programme at the La Parrilla Mine is now complete. Following seven months of hard work by staff and contractors, it has delivered significant plant improvements, enhanced the workflow, improved efficiency and has increased production of tungsten and tin concentrate from the mine. This is evidenced by the increase in production of concentrate from July 2020 onwards, initially increasing on a pro-forma basis in Q3 2020 and then in absolute terms in Q4 2020.
The final phase of the Plant Improvement Programme included a planned closure in late January to enable the final stages of the Programme to be implemented. Whilst this was initially planned as a four-week closure, the team and contractors accelerated the process reducing this period to just two weeks.
As the final stages gained momentum, the La Parrilla Mine faced very unseasonal weather conditions. During early February, the Extremadura region of Spain experienced the highest amount of rainfall recorded in the last seven years. This came at a time when the water level of the historic mine pit adjacent to the mine was already unseasonably high and as a result it became unsafe for the team to access the higher-grade ore. As the team looked to resolve this, the decision was taken to delay the recommencement of production until mid-February, when the mine restarted. Notwithstanding this hurdle, the success of the Plant Improvement Programme has been reinforced with expectations of Q1 production being the highest to date.
The management and operations team at La Parrilla are taking steps to lower the water level and regain access to the higher-grade ore and it is envisioned that these steps will create a permanent solution covering the life of the mine.
With a stockpile of mid and lower level grade ore on site, processing will continue and the amount of concentrate expected to be produced in Q1 and Q2 2021 will be ahead of any previously reported quarter.
The Company is pleased to see that prices for its concentrate have remained robust this year, in particular the price of tin which sat in excess of US$26,100/t last week, which benefited the sale of the latest 20t tin shipment. Tungsten remains robust at cUS$250/mtu further highlighting the strength of our low-cost production, which benefited recent tungsten shipments and those to be shipped later in Q1.
Michael Masterman, Chairman of W Resources commented: “We are clearly delighted to have completed our Plant Improvement Programme and my gratitude goes to all our staff who have worked so hard to make this happen. It is frustrating that as we find ourselves on the cusp of seeing significant increases in the production of concentrate with much improved plant processing, we are denied access to our highest-grade ore due to high water levels. The team is working hard to resolve this and as soon as the water levels fall and we can safely access our higher-grade ore, we can then start to ramp-up to more significant growth in concentrate production.”
Information communicated within this announcement is deemed to constitute inside information as stipulated under the UK Market Abuse Regulation. Upon the publication of this announcement, this inside information is now considered to be in the public domain.
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