Devon-based tungsten miner Wolf Minerals (LON:WLFE ASX:WLF)) is looking to bolster its financial position as it moves towards commercial production at the Hemerdon mine near Plymouth.
Mining activities progressed on schedule in the three months to June, said managing director Russell Clark, but the process plant’s teething problems affected concentrate production.
Some 1.6m tonnes of ore has been extracted in 2016 so far, but what has been mined has come from near the surface and been much finer than the specification of the process plant.
Areas of improvement have been identified, Clark said, and production should increase over the coming quarters. As mining gets deeper, the ore will also become harder and more like the type expected, which should improve recoveries.
Even so, and with tungsten prices still weak, Clark said Wolf wants to strengthen its financial position ahead of declaring commercial production.
Cash holdings were A$35mln at the end of the quarter, but it is now in default of a minimum forward cash flow forecast requirement covenant and is talking to lenders about how to resolve this.
Shares rose 12% to 7.55p.