Capital Metals PLC (AIM:CMET) said it is monitoring the economic and political situation in Sri Lanka where it is developing the Eastern Minerals heavy mineral sands project.
A state of emergency was declared today in Sri Lanka, shortly after the president fled the country, as mass protests continue over the country’s economic crisis.
The Eastern Minerals project, one of the highest-grade mineral sands projects globally, is closely approaching the final investment decision for development.
“The board expects that recent political changes should enable change to occur more rapidly with increased international cooperation and an overriding requirement to encourage foreign investment and job creation in the country,” said the AIM-traded company in an update.
“The local management team's focus has been on advancing discussions with the Geological Survey and Mines Bureau (GSMB) to advance the Industrial Mining Licence (IML) and, as there are currently limited field activities, the day-to-day operations have been largely unaffected."
However, the laboratory analysis of samples from last year’s drilling programme has been impacted by energy and fuel shortages.
"The current situation continues to be very challenging for all Sri Lankans and we are therefore even more focussed on maintaining our support for our local staff and the project communities during this time,” said chief executive Michael Frayne.
“Clearly the award of the IML will be pivotal in unlocking the value of the project. Whilst we cannot control the timing of its issuance, we remain in regular and constructive dialogue with the relevant authorities and are responding to frequent information requests, which we believe is a positive indication of progress.
“We continue to have positive discussions with prospective offtakers who are interested in our products, with the objective that such parties will form a significant part of the future capex funding package.”