W Resources PLC (LON:WRES) Chairman Michael Masterman caught up with DirectorsTalk for an exclusive interview to discuss the JORC update on La Parrilla in Spain, the impact on the development work, progress and key priorities for the coming months
Q1: Great to see the JORC update on La Parrilla in Spain with strong upgrades, can you talk us through the key highlights investors should be looking at from the Golder report?
A1: W Resources had a very very successful drilling campaign at the back end of 2015 and this is the results that come through when you pull all of the resources together. It’s an exceptional result, we’re seeing increases in tonnage, we’re seeing significant increases in grade across the overall resource and very importantly we’ve seen an upgrade in the quality of the resource to 70% indicated or 36 million tonnes. The grades that we’re seeing from the new areas drilled, the Fast Track Mine area which we’ll start mining this year and La Parrilla West which is to the west of the main ore body, are higher, on average higher, and in particular higher with a number of high grade outcrops which we can access very early on the projects development. More tonnes, more grade, significantly better quality resource definition and the potential to translate this into mine plans and plant feeds at high grades than were originally expected.
Q2: What impact will this have on development of the project?
A2: Well it was a critical step in terms of what we call pre-FID or Pre-Final Investment Decision work leading up to pushing the button on the main expenditure and financing for the project. So we needed the resource, we needed it at high quality and we needed to know that there were parts of the ore body that were readily accessible that we could get into the plant at low cost. The resource estimate is showing us all the directions to achieve that, the next step is translating that into the mine plan and the mine schedules and that work has commenced and motoring along for completion in the second quarter.
Q3: Now you mentioned development work is progressing leading up to the Final Investment Decision, can you give us an update on how that’s progressing?
A3: There’s three main work streams, there’s the geological work that’s come together in this resource estimate, there’s very important mine planning and mine scheduling work which will be important for both revenue and costs and there’s a very important phase work in terms of the metallurgical work; the process, engineering and design and the capital costs for the project which are also progressing in parallel. So we’ve got the geology and the resource out today, we see the mining and the metallurgy and the capital costs out in the second quarter and it’s all going to tie together to what’s got the fundamentals of a very low capital cost mine development.
Q4: What are your key priorities for W Resources on La Parrilla for the coming months?
A4: It’s very much go from this resource estimate to mine plan, mine schedule and mine costs, complete the capital estimates at the next level of detail so we’ve got hard toughened capital and operating cost estimates for decision making in the second quarter in parallel with this work, and this is the normal critical work for a successful mine development, we’re doing the financing so this work gets the best chance for low cost non-dilutive financing for the project.
