The Drakelands mine, in south-west England.
JOHANNESBURG (miningweekly.com) – Steady progress at the Drakelands mine in Devon, south-west England, has resulted in Wolf Minerals managing to negotiate financing arrangements that will support the company’s aim of achieving long-term self-sustaining cash flow, the UK-focused speciality metals producer reported on Thursday.
Wolf, which maintains listings on the ASX and Aim markets, has restructured its £64-million debt with its existing senior lenders and has agreed an extension to the offtake standstill period of certain loan agreements until January 31, 2019.
The terms of the debt restructure provide that the senior debt principal repayments would be reduced to £1-million a quarter, due on April 30, 2018, July 31, 2018 and October 31, 2018, before reverting to the current principal repayments schedule from January next year.
Resource Capital Fund VI has further agreed to provide an additional £10-million, secured subordinated loan under an existing bridge loan facility, with the potential to increase this by another £5-million.
The subordinated loan will have an interest rate of 15% a year, payable quarterly. The convertible loan has an interest rate of 10% a year, also payable quarterly.
“We anticipate 2018 being a transformative year for Wolf, where it reaches design performance. These financing arrangements provide a platform to achieve those goals,” Wolf interim MD Richard Lucas commented in a statement.
He also reported that the operational ramp-up at the Drakelands openpit tungsten mine was progressing toward completion.
The company reported in January that the Drakelands mine, which forms part of the Hemerdon tungsten and tin project, had delivered a 22% increase in production and a 36% increase in sales in the December quarter, with tungsten concentrate production having increased to 43 498 mtu. This compares with 35 601 mtu in the September quarter, 30 996 mtu in the June quarter and 26 903 mtu in the March quarter. Tin production increased to 124 t in the December quarter, from 49 t, 41 t and 41 t respectively, in the three preceding quarters.