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W Resources Plc

W Resources Plc Haulage and Crushing Contract Signed for Régua

W Resources Plc (LON: WRES), the tungsten, tin and gold mining company has today announced it has signed a contract with FPMI to provide low cost haulage and crushing services to its Régua tungsten mine in Northern Portugal.

· Contract signed for ore haulage and crushing at Régua with Francisco Pereira Marinho Imaos SA

· Competitive pricing of approximately US$40-45/mtu and low capital requirement of €50,000 for road establishment

Under the contract, once mining has commenced, ore from Régua will be hauled 27km to the existing FPMI crusher and crushed to a range of 5-10mm. As part of the service contract, FPMI will use the waste ore for rehabilitation of their existing quarry providing local environmental benefits. The estimated crushing and haulage cost is cUS$40-45/mtu and W will pay €50,000 to expand access roads for haulage.

The Régua mine and processing circuit comprises:

  1. Near horizontal adit mining using contract mining and a combination of open stoping and room and pillar
  2. Haulage of ore from mine face to FPMI crushing plant
  3. Crushing of ore to 5-10 mm using the existing FPMI crusher
  4. Processing the crushed ore through to tungsten concentrate using the existing La Parrilla Concentrator Plant which will be moved to Régua and upgraded later this year.

Golder Associates Pty Ltd, who completed the JORC Compliant Mineral Reserves and Resource Estimate in 2015 are working on the updated Reserves and Resource estimate and have advised it will be completed no later than early October 2019.

Michael Masterman, Chairman of W Resources commented:

“Régua is a high-grade, low-capital cost tungsten mine development with significant scope to increase the resource base, which is currently underway. The haulage and crushing services contract with FPMI allows W to advance Régua to development with efficient capital deployment.

“Our aim is to bring Régua into commercial production with sensible capital deployment leveraging contract mining, haulage and crushing contracts, thereby keeping the capital costs of development low. The FPMI contract is an important step in achieving this objective.”

W Resources also provided an update on La Parrilla and São Martinho.

La Parrilla

· La Parrilla Jig Plant commissioned to design throughput of 300 tph

· Jigged preconcentrate of over 3,500 tonnes has been processed through to concentrate in existing Concentrator Plant

· Production is expected to increase significantly in July to 20 tonnes of concentrate following the move to a 24 hour operation at the existing concentrator and the upgrade to higher grade ore feed now that initial commissioning is complete

· The new La Parrilla Concentrator advancing to primary construction completion in June, in line with guidance

At La Parrilla, the team continues to advance commissioning of the Jig and Mill Plant which is reaching design throughput. The Jig and Mill Plant has produced over 3,500 tonnes of pre-concentrate which has been progressively processed through the existing Concentrator Plant. In the start up phase we have intentionally commissioned the jig plant with low grade ore prioritizing medium and higher grade ore following achievement of throughput and recovery targets. We will move to higher grade feed next week. Production of concentrate restarted in June 2019 and is expected to rise significantly to 20 tonnes of concentrate in July, with the move to 24 hour production at the existing concentrator and the move to materially higher grade ore supply.

Construction completion of the large scale Concentrator Plant remains on track for the plant to be completed by the end of June and commissioned in July following installation of the motor control centre (“MCC”) and other final electrical and instrumentation equipment.

São Martinho

At the São Martinho gold project in central Portugal the trial mine application submitted in September 2018 is progressing through the regulatory process.

SRK Consulting (UK) Ltd continues to evaluate the project with a view to finalising the increased resource estimate which the Company expects to be completed in July. In initial estimates, there is a large increase in the modelled volumes, but differences exist in geological opinion as to whether the deposit is flat lying as in the Golder Associates Pty Ltd and W Resources assessment or deeply dipping as in the current SRK interpretation. These differences are partly due to the combination of structural complexity and multistage mineralising events.

Michael Masterman, commented:

“With a very firm focus on ramp-up at La Parrilla, H2 is looking very exciting as we finalise the last few areas of the plant in order to transition to the full ramp-up of this world class tungsten project.

“Whilst slow progress in finalising the updated JORC estimate for São Martinho has been extremely frustrating for both the management of W Resources and investors alike, the potential size of the deposit is encouraging and we have firmly requested that SRK address the issues our Qualified Persons have raised and finalise the report.”