logo-loader
Ormonde Mining plc

Ormonde Mining sees Barruecopardo ramp-up coinciding with tungsten deficit

Snapshot

When fully operational, Barruecopardo will account for around 13% of non-Chinese global supply of tungsten concentrates.

lights

Quick facts: Ormonde Mining plc

Price: £0.03

Market: AIM
Market Cap: £12.16 m
Follow

 

  • Ormonde Mining has developed Barruecopardo tungsten mine in Spain

  • Mine is ramping up to full production

  • Tungsten market predicted to fall into deficit by 2020

  • Prices tipped to improve as supply reduces

 

What it owns

Tungsten

Ormonde Mining plc (LON:ORM) A stake of 30% in Barruecopardo, a low-cost tungsten mining project in Spain that is in the advanced stages of construction.

When fully operational, Barruecopardo will account for around 13% of non-Chinese global supply of tungsten concentrates.

The new mine development is based on an initial open pit mining operation with a 9-year mine life, producing 260,000 metric tonne units (“mtu”) of tungsten trioxide (WO3) per year, or 2,060 tonnes of tungsten metal, contained in a high-quality concentrate, following a one year ramp up period.

Ormonde holds a 30% interest in the project company, Saloro SLU which is funded through a US$100mln financing package provided by 70% JV partner Oaktree Capital.

Gold

Salamanca and Zamora Gold are held through a joint venture (48%/44% respectively) with Shearwater Group PLC.

The area is one of the most prospective gold terrains in Spain, Ormonde believes.

Copper

Ormonde took an impairment charge of €600,000 for the former working copper mine of La Zarza in its 2018 figures and is now looking to sell it.

 

How is it doing

In June, Ormonde said it is expecting to reach higher grade ore at Barruecopardo by the end of the year.

The AIM-listed firm said it also expected to attain steady-state processing operations at the project before the end of 2019.

That would result in a “robust outlook” going forward after the current ramp-up period.

Largely due to the impairments Ormonde reported a loss after tax of €1.65mln in 2018 compared to €100,000 a year earlier.

 

What the boss says: Michael O’Donoghue, chairman

“The lower grade ore encountered in the initial, peripheral starter pit will make the remainder of this year somewhat challenging as Saloro's profitability and cashflows will continue to be constrained during the mine's ramp-up phase, however the progress made to date on processing of this lower grade material should stand the pProject in good stead 

 

Inflexion points

  • Latest forecast is for tungsten to be in deficit in 2019 and 2020 as Russian and Chinese sources deplete
  • There no plans for China to replace tungsten mins as they run down says Ormonde
  • Prices might therefore rise in short to medium term
  • Scope to develop “new ideas and opportunities” to add value added Ormonde
  • Completion of disposal of La Zarza interests
  • New look at the gold exploration opportunities

Add related topics to MyProactive

Create your account: sign up and get ahead on news and events

NO INVESTMENT ADVICE

The Company is a publisher. You understand and agree that no content published on the Site constitutes a recommendation that any particular security, portfolio of securities, transaction, or investment strategy is...

In exchange for publishing services rendered by the Company on behalf of Ormonde Mining plc named herein, including the promotion by the Company of Ormonde Mining plc in any Content on the Site, the Company receives...

FOR OUR FULL DISCLAIMER CLICK HERE

Watch

Ormonde Mining's Steve Nicol upbeat as Barruecopardo tungsten mine continues...

Ormonde Mining managing director Steve Nicol sat down with Proactive Investors to talk us through the busy phase of work currently underway as the development of the Barruecopardo tungsten mine progresses towards completion. Fully funded, fully permitted and on track for a 2017 start up,...

on 27/7/16

3 min read