EQ Resources Limited (ASX: EQR) has completed the first A$5 million drawdown from Regal Resources Royalties Fund under the terms of a A$10 million royalty-based funding package for the redevelopment of the historic Mt Carbine tungsten in Queensland, Australia.
A definitive agreement was signed following the successful completion of the technical, tax and legal due diligence conducted by independent advisors engaged by the parties. The second A$5 million drawdown can be executed upon receipt of final environmental permitting for the restarting of open pit mining operations and satisfaction of stipulated Conditions Precedents in the term sheet signed between EQR and Regal Resources Royalties Fund. Submission to the Government was made in the fourth quarter last year, with approval expected within the first quarter of 2023.
As part of the initial term sheet, the parties intend to negotiate in good faith the terms for an additional (second stage) A$10 million royalty-based funding package.
EQR is Australia’s only primary producer of tungsten concentrate, a listed critical mineral by the US and EU. The royalty funding complements the company’s already established funding plan as part of the Updated Mt Carbine Bankable Feasibility Study. The funding plan comprises capital already invested in the processing plants, the A$6 million grant funding under the Federal Government’s Critical Minerals Accelerator Initiative, a financing package from global processing equipment supplier Sandvik, a shareholder loan, offtake partner support and A$4.56 million raised via a share placement.
“We are pleased to have continued support from such a high-profile fund in the Australian resource space,” EQR’s CEO, Kevin MacNeill, said.
“The timing of this first drawdown is perfect as we aggressively work toward restarting the open cut mining from the Andy White pit in the second quarter of this year and actively drill our planned targets to expand our pit to the west and below.”
Mr MacNeill said the growing global tungsten market is being supported by increasing demand for traditional metal hardening additives and is being fuelled by further developments relating to its important role in the future of lithium-ion battery technologies and in the manufacturing of photovoltaic cells as the world economies look toward decarbonisation technologies.
The ongoing expansion project at Mt Carbine will continue EQR’s commitment to building a sustainable mining operation. Once fully commissioned, the Project is expected to create a permanent workforce of more than 100 at Mt Carbine, where the current headcount is around 70. EQR will be a major employer in the Mt Molloy district, a thriving hub of pioneering tin, tungsten and gold mining more than 100 years ago.
For further information please visit: https://eqresources.com.au/
