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Ormonde Mining presses go on Barruecopardo mine amid rising tungsten prices

APT prices have gradually been moving north since touching a low of $162 per metric tonne unit in January 2016

Tungsten prices are seen rising

Ormonde Mining plc (LON:ORM) has pressed go on commissioning its Barruecopardo tungsten mine with a revised timetable in the light of rising tungsten prices.

Commissioning of the mine in Salamanca, Spain is now earmarked for the third quarter of 2018.

The project had been originally scheduled for the end of 2017, but was put back in December 2016 due to the weakness of the metal.

APT prices have gradually been moving north since touching a low of $162 per metric tonne unit in January 2016 and indicators are now pointing towards a sustained increase into the future, the firm said.

Ormonde noted that the APT price is now around $220-225 per mtu (metric tonne unit) which represents around a 37% increase since the January 2016,  with the period since July 2016 seeing a modest but consistent uptrend in price.

"Following a period of review of the construction schedule, the board of the project company, Saloro SLU (Saloro), has authorised the issuance of outstanding approvals on various equipment and plant construction contracts, thus advancing the project into an accelerated construction and implementation phase," the group said today.

Ormonde chairman Michael Donoghue added that the company had always been aware of  "ensuring that the Barruecopardo project comes online into a strengthening tungsten price environment, thus not exposing the project or its shareholders to undue risk during the critical commissioning and start-up phases". 

Ormonde also noted that Steve Nicol, the current managing director, will relinquish that role in order to focus full time as MD of Saloro and the project manager for Barruecopardo. 

Mike Donoghue, current chairman, will act as interim managing director after the upcoming AGM (annual general meeting).

Saloro has agreed to certain amendments to the as yet undrawn debt facility to align with the approved construction schedule.

Subject to the latest development schedule being implemented, the remaining part of the equity investment, of around €16 million, will be drawn on a pro rata basis with the debt during the development period, with any residual equity amounts being drawn on commissioning.

Shares added 9.43% in London in early deals to stand at 1.45p.

Quick facts: Ormonde Mining plc

Price: 0.615 GBX

Market: AIM
Market Cap: £2.91 m

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