Transcription of Finance News Network Interview with Wolf Minerals Limited (ASX:WLF, AIM:WLFE) CEO and Managing Director, Russell ClarkLelde Smits: Hello I’m Lelde Smits for the Finance News Network and joining me today from metal explorer and developer, Wolf Minerals Limited (ASX:WLF, AIM:WLFE) is its CEO and Managing Director, Russell Clark. Russell welcome to Mines and Money here in London.
Russell Clark: Thanks Lelde.
Lelde Smits: Wolf Mineral’s flagship project is your Hemerdon tungsten and tin project. Where is it located and what makes it unique?
Russell Clark: Wolf’s Hemerdon project is located in the southwest of England, near Devon. And it’s primarily unique, because it’s been the first metal mine in England for 45 years. It’s a tungsten project.
Lelde Smits: The Company is listed on both the ASX and AIM Exchanges; Australia based but developing an English project. What is the rationale behind being based here in England?
Russell Clark: When Wolf was listed it had tenements in New South Wales. They didn’t go anywhere and the Company then became aware of the tungsten project in Devon. And it made sense once we picked that project up to list on the AIM.
Lelde Smits: Now if we can look closer at tungsten, global tungsten demand is forecast to grow by up to 50 per cent between 2010 and 2015. Where is this demand coming from?
Russell Clark: Tungsten demand tends to follow global GDP growth. You’re seeing China growing at seven per cent, you’re seeing American and Europe begin to wake up and the demand for tungsten is expected to increase by about 4,000 to 5,000 tonnes a year. Hemerdon will produce 3,500 tonnes. So we’re looking at one of these projects coming on each year, only besides the Hemerdon project, we can’t see any more in the pipeline.
Lelde Smits: The British Geological Survey named tungsten as a top five strategically important metal in 2011. What makes tungsten so critical and where do you anticipate potential customer demand will come from?
Russell Clark: Tungsten is regarded as a strategically critical metal, primarily because China produces the bulk of it. So America, Japan, Europe see it as a strategic or critical metal, because tungsten gets used in a lot of shaping and cutting of industrial product. So everything that people have in their house has seen tungsten.
Lelde Smits: Now Russell, if we can look closer at your Hemerdon project in the southwest of the UK. What is the size of the resource and what are your ambitions for the project?
Russell Clark: So we have over 400 million tonnes of resource, but we only have 25 million tonnes of reserve, which really gives you a sense of the expandability of this project. We have planning permission; we will develop the mine within that planning permission for about 10 years. We plan to start production in 2015. But there is great potential with this project to either extend the length, or increase the production on an annual basis.
Lelde Smits: The project was acquired in 2007 and a Definitive Feasibility Study (DFS) completed in 2011. What did it reveal about the project’s viability?
Russell Clark: The DFS showed that this project was financially very robust. And that’s demonstrated by the fact that we’ve got some great cornerstone investors, through RCF (Resource Capital Funds) and Todd Corporation. And the fact that we’ve been able to put 75 million pounds worth of project development in place with three development banks. That really speaks volumes for this project at a time when the world’s been pretty flat financially.
Lelde Smits: What has occurred at Hamerdon since the DFS and what are your highlights from this year?
Russell Clark: We’ve got a lot going on at the moment. We’ve established a management team on the site, we’ve established project finance. We’ve appointed GR Engineering
(ASX:GNG) as the engineering contractor and we expect that they will start onsite in early 2014. We have been working on an environmental permit and the purchase of some property, both of which are prerequisites to starting this project. And both of which, we expect to be finalised in December this year.
Lelde Smits: Wolf Minerals is aiming to be in production in 2015. What has to occur before then and what are your immediate priorities?
Russell Clark: Our immediate priority is to get the construction company, GR Engineering, on the site in early 2014. They will take a year to build the project and will commission it in the first half of 2015. So full speed production will be happening about mid-2015.
Lelde Smits: And Russell, how does the Company plan to fund the project?
Russell Clark: The funding package is broadly in place. We have project finance to the tune of 75 million pounds from three banks. And we have a bridging loan provided to us by RCF, which we will be replacing with equity during 2014.
Lelde Smits: Finally Russell, as you position Wolf Minerals to reach production, how do you anticipate producer status will change the Company?
Russell Clark: This producer status will change this Company enormously. We will have cash flow; we will have the opportunity to look at other projects. We’ll have the opportunity to expand this project and the expertise that we have in-house, will increase enormously.
Lelde Smits: Russell Clark, thanks for joining us in London today and introducing us to Wolf Minerals.
Russell Clark: Thanks Lelde.
Ends
