Tungsten West plc said it expected to reduce its workforce by 42% as part of cost cutting measures at Hemerdon tin-tungsten mine in Devon.
SAVINGS
The company forecasts redundancies and resignations will meet the targets in its nearly completed cost reduction programme which began in April 2023.
“Monthly recurring payroll costs are expected to reduce by 42% in line with the reduction in headcount.
“The one-off cost associated with the programme is forecast to be minimal and mostly comprised of contractor project suspension fees.
“Project capex for the front-end re-build has been scaled back to existing capital commitments for equipment purchase and low-frequency noise trial work.”
Refurbishment work within the plant has also been halted until the permitting and funding processes are complete.
“Ongoing opex is in line with previous guidance and remains concentrated on key workstreams associated with securing the section 73 planning permission and the outstanding permit, care and maintenance, compliance with existing obligations and securing funding,” added the company.
FUNDING
Tungsten West paused operations in April 2022 to review its plans because of rising inflation.
It was also in discussions for additional funds after its revised plans failed to meet the $49 million loan terms from Orion Resource Partners.
In October 2022, the estimated remaining capital expenditure was published as £31.5 million, excluding a 20% contingency of £6.3m.
In March 2023, the company said it needed near-term funds to avoid reassessing the restart of Hemerdon.
In April 2023, Tungsten West said it aimed to raise up to £9 million and began “major” cost cutting.
During the 12-month period both the company’s co-founders Max Denning and Mark Thompson resigned.
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