Another one in trouble

Tungsten West needs £65m for Plymouth mine to open by 2025Bosses at the Hemerdon Mine say about 20 jobs could go this autumnplymouthheraldEnter your postcode for local news and infoTungsten West's Hemerdon Mine, at Plympton, PlymouthGet the stories that matter to our community straight to your inbox with our Daily NewsletterMore Newsletters SubscribeWe use your sign-up to provide content in ways you’ve consented to and improve our understanding of you. This may include adverts from us and third parties based on our knowledge of you. More infoPlymouth’s tungsten mine could be in full production by 2025 but needs vital permits to be granted and will have to raise up to £65m. Bosses at the Hemerdon Mine say investors are keen to back the project but until the permits arrive they will need to slash costs and about 20 jobs could go this autumn.If the permits are not approved before the end of 2023 the project could be in serious jeopardy. Tungsten West Plc has borrowed nearly £7m which will see it through this year and is relying on there being no delay to receiving the permissions.But if all goes to plan, however, it will mean Tungsten West can press on with raising more finance, finish building the Mineral Processing Facility (MPF) and work towards full production. The mine, at Plympton, could be fully operating by 2025 and employ 300 staff, with a huge impact on the supply chain locally too.Neil Gawthorpe, Tungsten West chief executive, said there is optimism the permits will arrive in time and funding will be secured, allowing the mine, also a key source of tin, to become a vital resource for the western world and an economic generator for the city and region. He said: “For a relatively small investment we can be up and running in 18 months and providing the UK with two critical minerals.”Mr Gawthorpe took over as chief executive in March 2023 after the departure of Mark Thompson, who had been in place for less than a year. Prior to taking the top job Mr Gawthorpe had been a consultant at the mine for a year, so knows the operation well.He has taken command at a crucial time for the AIM-listed company and the mine, the largest tungsten resource in the world outside China and Vietnam. The company was faced with the prospect of running out of cash before it had received all the permits needed to press ahead with reopening the mine.But a plan was put in place which, in May, saw Tungsten West raise up to £6.95m in funds via convertible loan notes (CLNs), which are interest bearing loans convertible into shares. The second tranche of this funding has arrived and means there is enough cash to get the company through this year.However, the funding came with conditions including a cost reduction programme which saw the workforce reduced from 93 to 53. Tungsten West has now started another redundancy consultation which could bring headcount down to 30, and has agreed deferred payments and restructured supply agreements with creditors.Spending had to be focussed on activities relating to planning and permitting, environmental compliance and funding, all essential to the continued progress of the project. Tungsten West has now completed low frequency noise (LFN) trials, and made a formal submission to the Environment Agency to secure the Mineral Processing Facility (MPF) permit. The company has also submitted an application to vary the tonnage cap on truck movements from the site.Mr Gawthorpe said the company believes it will receive the permits by the end of October and press ahead. He said: “We have enough money until the end of this year and go into a new fundraising exercise once the permits are received.“There are lots of expressions of interest from lenders wanting to fund this project, once we have these permits. That includes funding from existing shareholders and from new investors.”