W Resources PLC (LON:WRES) shares gained on Tuesday following news it has received preliminary approval for a US$30mln term loan with a US special situations fund to finance the La Parrilla tungsten/tin mine in Spain.
In late afternoon trading, shares in W Resources were up 12.1%, or 0.04p at 0.37p.
The fund’s investment committee has agreed the term loan with financial close targeted for late December 2017 or January 2018.
W Resources added the loan is based on competitive terms and will fully fund the development of the first phase of the mine’s development.
The plan in the first phase is to produce 2,700 tonnes of tungsten concentrate a year from mining 2mln tonnes of ore, with mine production to be expanded to 3.5mtpa/4,000 tonnes of concentrate in the second phase.
W Resources added it expects to hear back on whether it will receive a percentage of the €19.5m plant and facilities package to be allocated by the Junta de Extremadura government in January 2018,
Environmental approval documentation to expand the mine to 3.5 mtpa has also now been submitted.
At La Parrilla, engineering work is on schedule for completion in the first quarter of 2018 and orders for all long lead items have been placed, the junior added.
Letters of intent with two leading tungsten customers have been signed and the offtake contract documentation being finalised.
Michael Masterman, chairman, said: "The board is delighted to have received preliminary approval for the funding of La Parrilla.
“2018 looks set to be a transformational year for the company as we conclude the plant development and start production at La Parrilla.
“Our shareholders have been extremely patient and we now look forward to closing the financing and accelerating the development process."
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