CENTENNIAL, Aug. 09, 2018 - Westwater Resources Inc. (“WWR” or “the Company”) (Nasdaq: WWR), an energy materials development company, today announced its results for the second quarter of fiscal year 2018, along with a business outlook and new developments in its energy materials business.
Christopher M. Jones, President and Chief Executive Officer, said, “Our continued work to diversify our operating assets into battery materials has now resulted in the acquisition of Alabama Graphite Corp., giving us a first mover advantage in a key component of electrical storage devices. Our business plan published last month is to fast-track the development of battery grade graphite production capacity in Alabama and continue to explore for lithium in the American West.
“Overall, we have taken an opportunistic approach towards acquiring and developing our portfolio of products—graphite, lithium, and uranium, all of which are on the Critical Minerals List, which was submitted to the US Department of Commerce for action in May 2018. These minerals were included due to their importance to the security and economic prosperity of the United States. We believe this positions WWR to realize long-term shareholder value as an American producer of these critical materials,” concluded Mr. Jones.
Highlights for 2Q-2018 and Year to Date
- On April 23, 2018, Westwater completed the acquisition of Alabama Graphite Corp., which positions WWR as a near term producer of advanced battery graphite materials.
- GRAPHITE BUSINESS OPTIMIZATION: The Company announced an optimized business plan for its new, US based graphite business:
- Pilot plant operations are scheduled for 2019.
- Time honored and well-proven technologies are now planned for production.
Plant start up and initial operations will utilize purchased graphite feedstock, bringing forward revenues and cash flow in time.
- First revenues are expected in 2020.
- Positive cash flow for the graphite business is expected in 2021.
- The mine is planned for construction in 2025, with planned production in 2026 – funded from operating cash flow rather than external financing.
- Net present values are estimated to be $400 - $500 million, depending on contingency.
- Capital expenditures, now including pilot plant studies and final plant design, are estimated at $41.6 million.
- Some 35 non-disclosure agreements are in place with potential suppliers and customers for battery grade graphite materials.
- Sample material has been sent to some of these customers for qualification test work designed to ascertain suitability for purchase.
- Work continues with business, state and local officials in Alabama to site, permit and explore business incentives. - LITHIUM EXPLORATION PROJECTS:
- On March 24, 2018, the Company exercised an option to acquire a block of unpatented placer mining claims covering an area of approximately 3,000 acres within the Columbus Salt Marsh area of Esmeralda County, Nevada.
- The Company continues to develop its water rights positions and geological knowledge on its three highly prospective lithium-enriched brine properties in Nevada and Utah, USA. - URANIUM PROJECTS:
- On June 20, 2018, the Turkish government notified the Company that the mining and exploration licenses for its Temrezli and Sefaatli projects located in Turkey have been revoked and potential compensation has been proffered. While the Company is investigating the legality of this action and what remedies, including compensation, might be available, the Company has determined that it is more likely than not that the Company will be unable to explore, develop, mine or otherwise benefit from the mineral properties and, therefore, all of the uranium mineral holding property assets located in Turkey were fully impaired. The amount of the impairment charge reflects the accounting net book value for the uranium holding property assets and does not reflect the fair market value of the assets.
- Continued restoration/reclamation activities in South Texas. Work continues to complete reclamation at Rosita in Production Areas 1 & 2 and wellfield reclamation at Vasquez.
- In New Mexico, the Company published a new technical report outlining resources on its property holdings at Ambrosia Lake. - TEXAS SUPREME COURT SUCCESS: After a 9-year legal dispute with Kleberg County, Westwater has prevailed at the Texas Supreme Court, enabling future reclamation of some of our wellfields at our Kingsville Dome site.
- M&A EFFORTS: WWR maintains an opportunistic posture in mergers and acquisitions by focusing on low-cost, high value development opportunities in the resource sector.
- COST RATIONALIZATION EFFORTS: Continue to reduce operating and general and administrative expenditures.
- PROPERTY RATIONALIZATION: On January 5, 2018 Laramide Resources Ltd. (“Laramide”) made the first required $1.5 million principal payment to Westwater on its original $5.0 million promissory note, consisting of $750,000 in cash and the issuance of 1,982,483 of Laramide’s common shares. Laramide also made interest payments in 2018 of approximately $0.3 million in cash.
- EQUITY CAPITAL RAISES: In 2018 to date, the Company has raised net proceeds of $4.7 million, comprised of $1.8 million from sales of stock pursuant to the Company’s Stock Purchase Agreement with Aspire Capital (now terminated) and the ATM facility with Cantor Fitzgerald, and a registered direct offering of $2.9 million from the sale of common stock and pre-funded warrants to Aspire Capital which closed on June 14, 2018. All warrants have been exercised as of August 8, 2018.
- CASH AND WORKING CAPITAL: Cash and working capital balances at June 30, 2018 were $2.7 million and $2.2 million, respectively. https://www.minenportal.de/artikel.php?sid=241132&lang=en#Westwater-Resources-Reports-Second-Quarter-2018-Operating-Results%20target=
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