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W Resources gets 'green' light for La Parrilla mine

Environmental approval has been granted to develop the La Parilla mine in southern Spain.

La-Parrilla.jpg
La Parilla already boasts good infrastructure.

--- Writes through with comments from chief executive ---

W Resources (LON:WRES) said the government of Extremadura in Southern Spain has granted an environmental permit to develop a mine at the La Parrilla tungsten project.

Chief executive Michael Masterman, a veteran of the resources sector, said the move was a "major milestone" in plans to get the pit fully into production in 2018.

It had originally been expected that the environmental permit would come through in the fourth quarter.

Masterman said: "Environmental approval gives us certainty on the timeline to production. Getting it ahead of schedule makes a very big difference to the company."

The plan is to develop hard-rock mining at La Parilla in two stages.

The fast-track mine will be completed next year, following an estimated capital spend of US$16mln, and will produce at a rate of between 1,200 and 1,300 tonnes of 66% tungsten trioxide concentrate and 110 tonnes of tin per year.

The full mine will then come on stream in 2018, producing at a rate of around 5,000 tonnes of tungsten trioxide and 400 tonnes of tin.

Masterman said W Resources had just finished drilling in the initial mine at La Parilla and results were coming through as expected.

He said the company had also just begun work at La Parilla West, which had potentially higher metal grades that could be quickly incorporated in the overall mining plan.

The next significant step will be the award of a development licence.

Masterman added: "Financing is something we're very much focused on with a laser eye and it's a priority for the company in the next three to six months.

"We're talking to a number of parties and environmental approval is a very important milestone in terms of building confidence."

Masterman described the project as one of the “largest in the western world”.

It’s certainly bigger than projects mooted by peers like Ormonde (LON:ORM) and Vital Metals (ASX:VML) and on a par with the UK’s own Wolf Minerals (LON:WLFE), which is now just a stone’s throw away from production at Hemerdon in Devon in the UK.

While tungsten prices have fallen recently, miners of the metal are confident about longer term prospects.

They say the world is facing a shortage of the metal, which is used in drill bits for the oil & gas industry as well as DIY tools and traditional electric light bulbs.

La Parrilla still has several significant hurdles to clear before it can get to Wolf’s stage, but it’s notable that things are running on apace.

Operations initially began at La Parrilla back in April of 2014, when the production of tungsten from old mine waste began.

That brought welcome cash flow, and also a confirmation that the product was acceptable to end users, but it was always only going to be an interim step before the full-blown development of a mine.

 

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Price: 0.1201 GBX

AIM:WRES
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