THE BOURSE WHISPERER: Wolf Minerals (ASX: WLF) has commenced development of the company’s Hemerdon tungsten and tin project in Devon, in southwest England.
The initial project development activities include:
– First drawdown from a US$82 million funding package provided by Resource Capital Fund (RCF);
– Commencement of a £75 million (~A$123 million) Engineer Procure Construct contract with ASX-listed GR Engineering Services (ASX: GNG); and
– Continuation of property purchases around the project site.
Wolf finalised the funding package with RCF in May this year, which comprises a 12 month secured Bridge Finance Facility of US$75 million (~A$79 million); as well as a US$7 million (~A$7 million) consideration for the purchase of a 2 per cent royalty by RCF on gross revenues from all metals and minerals produced from the Hemerdon project.
Wolf said it has received the first drawdown of US$10 million from the Bridge Finance Facility, plus the US$7 million consideration for the 2 per cent royalty.
“We are delighted to formally commence development at the Hemerdon project,” Wolf Minerals managing director Humphrey Hale said in the company’s announcement to the Australian Securities Exchange.
“The first draw-down of the funding package provided by RCF represents a major milestone for the company and our plans to bring the project in to production as a world class tungsten and tin mining operation.
“The funds will allow our EPC contractor GR Engineering to commence the EPC contract at Hemerdon, and we look forward to providing updates on development progress at the project in the months ahead.”
The fixed price, fixed term EPC Contract is for the design, construction and commissioning of a three million tonnes per annum tungsten and tin mineral processing plant plus associated infrastructure, forming the key component of the Hemerdon project.
Wolf has already purchased a number of properties required to develop the site and has negotiated options to purchase with the majority of the remaining landowners.
Wolf indicated it intends to exercise all of the options to purchase with the landowners on the site and finalise option agreements with the remainder.