Tri-Star pleased with SPMP progress despite delays

The AIM-traded firm said the commissioning process continued at the SPMP facility, with the process chemistry now proven, and crude antimony trioxide (ATO) produced and stockpiled in readiness for the commissioning of the furnace section of the plant.

It explained that while work to date demonstrated that the process was “fundamentally working well”, certain engineering issues had been encountered for which remediation requirements were apparently understood and in process.

The plant had produced a quantity of intermediate product, with Tri-Star saying SPMP was “looking forward” to providing a further update on first metal once the furnace commissioning was complete.

As a result of the delay in first metal and full commissioning of the plant, SPMP would need further funding for additional capex and working capital, the company said.

Such funding could be available from local Omani or international banks, from other funding providers, or from SPMP’s shareholders, with SPMP in discussions with a number of local banks who were apparently supportive.

As an interim measure, SPMP requested an additional $10.5m from its shareholders, and discussions were ongoing between SPMP and its shareholders as to how that finance could best be provided.

Over at the Göynük Project, which consists of the exploration and mining rights for a historical artisanal mine in a known antimony belt in the Murat Dagi mountains of western Turkey, of which Tri-Star currently owned 99.93%, it said it had signed a letter of intent.

That letter was with a local Turkish entity, as part of the sale process of the project, which it expected to close in the first quarter of this year.

Tri-Star said the purchaser planned to bring the mine back into production before the end of 2019, and had indicated a desire to enter into an offtake agreement with SPMP, which Tri-Star would facilitate.

“The SPMP management team is constantly improving the capability of this unique metal processing plant,” said Tri-Star Resources acting chief executive officer Karen O’Mahony.

“Some engineering glitches have arisen during commissioning.

“However, this is not unusual.”

O’Mahony said SPMP felt that the capability of the plant to produce antimony and other metals was now confirmed, with an update on first metal expected once the remediation work and furnace commissioning was complete.

“The delay means SPMP will need additional capital to finance its operations through to positive cashflow and management are engaged with a number of local banks who continue to be supportive.

“Whilst SPMP has requested an additional $10.5m from its shareholders, we are discussing the best approach to this funding, including speaking to local lenders and other funding providers.”

O’Mahony also noted that the Tri-Star board had made a strategic decision to sell its Turkish operations to a partner who could bring the mine into production.

“We look forward to introducing SPMP to the purchaser, with a potential antimony feedstock supply agreement in mind.”