Tungsten West Regulatory News (TUN)

13 March 2023

Tungsten West Plc

("Tungsten West", the "Company" or the "Group")

Directorate and Management Changes

Strategic Review and Project Update

Tungsten West plc (LON:TUN), the mining company focussed on restarting production at the Hemerdon tungsten and tin mine in Devon, UK ("Hemerdon" or the "Project"), is pleased to announce the following updates.

Directorate and management changes

Neil Gawthorpe has been appointed Chief Executive Officer with immediate effect. It is the Directors' intention for Neil to join the Board imminently.

Neil joins the senior executive team at a crucial time as the Company prepares to re-launch operations at Hemerdon, positioning Tungsten West as the Western World's largest tungsten producer. Neil's initial focus will be to conduct a review of the available funding options of the business to ensure the delivery of the Project as outlined in the previously announced feasibility study.

Neil holds a Bachelor of Engineering (Hons) in Mineral Engineering from the University of Leeds and has enjoyed a successful career in the mining industry, spanning almost 30 years, working in various roles, both operationally and as a consultant across multiple jurisdictions. Most recently Neil held the role of Senior Vice President ("SVP") Business Development at Allied Gold, where he was responsible for the due diligence on potential mergers and acquisitions, as well as leading transitional management and integration at newly acquired assets. Neil was heavily involved in the integration of the company's flagship Sadiola operation in Mali, following its purchase from Anglogold Ashanti/Iamgold in late-2020. He played a key role in embedding the new management team and mining contractor, culminating in an on-time and budget restart of mining. He also provided similar support during the integration of the company's multiple operations in Cote D'Ivoire.

Neil also spent nine years as part of the executive team at Sierra Rutile Limited, taking a struggling operation and transforming it into becoming the world's largest rutile producer. After completion of several major expansion projects, the asset was sold in December 2016 for more than US$400 million.

Additionally, Francis Johnstone and Grace Stevens have stepped down as Non-Executive Directors with immediate effect. Martin Wood, Senior Independent Non-Executive Director will lead the Audit and Risk Committee effective immediately.

The Board is well advanced in the process of identifying additional suitable industry experienced non-executive directors to enhance the Board's capabilities going forward and align the Board with the Company's strategic requirements as it moves to fund Hemerdon into production.

Project Update

Construction

Early stage works on the Hemerdon restart project commenced in January 2023 and are continuing safely and as planned. This includes bulk earthworks and civil engineering, which are necessary activities to ensure that the Project remains on track for delivery eight to nine months from full project funding being agreed. Additional to this enabling work, the Company has also received deliveries of steel rebar and components for the conveyor systems, and, as previously advised, has procured all long-lead equipment. Accordingly, at 31 December 2022 £14m of the Project capital expenditure has been spent at Hemerdon since the Company's IPO significantly preparing the Project for the restart.

Permitting

The Company has now received four of the five permits required for the Project restart. These are Abstraction Licences for the Pit, Loughter Mill and Tory Pond, as well as the Mine Waste Facility Permit. The Company remains engaged with the Environment Agency (the "EA") with regards to obtaining the final permit required for the Mineral Processing Facility. The EA has requested further modelling work to be carried out around the historic issue of the processing plant causing low frequency noise and although the Company is confident that the revised Project plan has eliminated this issue as well as significantly mitigated the general noise impact of the Project, the Company is currently liaising with the EA on timescales required to complete this work. This means the overall timeline to receiving this permit could extend further than initially anticipated, however, this does not currently fall on the critical path for Project restart.

Funding and Strategic Review

The Company is actively engaged in advanced negotiations with potential funding partners in respect of a combination of royalty, debt and equity financing, in order to secure the funds necessary to complete the Project. This will be a major focus of the new CEO and this process will be undertaken with the assistance of Hannam & Partners and VSA Capital.

In the unlikely event that the Company is unable to secure sufficient near-term funding to continue to advance the Project as planned, the Board would need to reappraise the scope and timing of Project delivery. Further updates will be made as and when appropriate.

David Cather, Chairman of Tungsten West, commented:

"On behalf of the Board and the Company, it is a pleasure to welcome Neil to the senior executive team.

"Neil has extensive experience in operational integration, stakeholder engagement and business development, having successfully provided management support at a number of operations. These skills, amassed over an impressive career, will be invaluable to Tungsten West as it continues to progress towards becoming a sustainable tungsten and tin producer. 

"I would like to thank Francis for his contribution since joining the Board in 2019, especially for his guidance through the early funding process and the transition to a listed company. I would also like to thank Grace for her dedication leading the Audit and Risk Committee and overseeing the Company's drive to meet the highest governance standards expected of a listed company.

"We are entering a pivotal time for the Company and, with someone with Neil's background at the helm, I am highly confident that we will complete a successful Project financing and continue to drive value for all stakeholders."

Neil Gawthorpe, Incoming Chief Executive Officer of Tungsten West, commented:

"It is a privilege to join Tungsten West as CEO and to help deliver the world-class Hemerdon project for the Company, local community and the nation. Having had already worked with the Tungsten West team in an advisory capacity, I have no doubt this will be a smooth transition and I look forward to bringing this exciting project online.

"It is my immediate priority to conduct a review of the funding options and timeline for the Project and update the market with the results shortly."

This announcement contains inside information for the purposes of Article 7 of Regulation 596/2014 as amended by the Market Abuse (Amendment) (EU Exit) Regulations 2019.

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