W Resources PLC - tungsten, tin and gold mining and exploring company in Spain and Portugal - Says fourth quarter production at its La Parrilla mine of tungsten concentrate dropped 47% to 89.7 tonnes from 168.3 tonnes in the prior quarter, with the recovery rate dropping quarter-on-quarter to 31% from 58%. Says production was hit by limited access to medium and higher-grade ore caused by a two-week delay in blasting, as well as delays caused by heavy rainfall into the pit. Heavy rain also constrained crushed ore operations, but stockpile will resolve the issue.
In 2022, January also saw a fault with its electromagnetic separator, which also reduced production volumes of concentrate. However, this was corrected towards the end of the month, and bags of work-in-progress will be reprocessed in February.
The poor performance in the fourth quarter and large price increases of liquified natural gas means company's cash is lower than expected. Accordingly, it will need to fundraise in the "very short term" to fund mine operations and boost its general working capital buffer. It expects the fundraise to take the form of debt, to be completed later in the week.
Chair Michael Masterman says: "The challenges encountered in Q4 arrested the progress made at La Parrilla over the three previous quarters, where we had quarter on quarter improvements in total concentrate production. Further work on the elimination of crushed ore blockages by building a stockpile of crushed material, as well as installing an additional connection to the grid power supply to mitigate against potential power outages and increasing gas prices is ongoing and we believe these actions will allay further challenges in the year ahead."
Current stock price: 2.75 pence, down 32% on Tuesday
12-month change: down 72%
By Elizabeth Winter; elizabethwinter@alliancenews.com
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