- VRX Silica Limited (ASX:VRX) has recently released its quarterly outcomes for the period ended March 2021.
- During the quarter, the explorer conducted a grade control drill program at the Arrowsmith North project, whose assay results are expected in late May 2021.
- VRX Silica closed the quarter with a decent cash balance of about AUD 8.8 million.
Progressing with the advancement of its major silica sand projects, VRX Silica Limited (ASX:VRX) has delivered another set of robust quarterly results for the period ended March 2021. VRX Silica saw a slew of developments across its Arrowsmith North, Arrowsmith Central and Muchea silica sand projects during the quarter, particularly with regard to the environmental approval process.
Keen to cash in on the growing demand for high-grade silica sand, the Company continued discussions with potential offtake partners for the sale of silica sand products from its projects in the March quarter. Notably, the demand for high-grade silica sand has been heating up in glass manufacturing and foundry casting across the Asian region, offering a lucrative opportunity for the Company.
Let us quickly browse through the developments that shaped an eventful March quarter for VRX Silica:
Grade Control Drilling at Arrowsmith North
The Company carried out a 130-hole grade control drill program at its Arrowsmith North silica sand project during the quarter. The drilling was undertaken for over 10 days, with assays expected to be released in late May 2021.
The grade control area exists wholly within the previously reported area of the Ore Reserve Statement (ORS) of 204 Mt @ 99.7% SiO2 within M70/1389 Mining Lease. Moreover, the area contains about 10.2 Million tonnes of Probable Ore Reserve.
The close spaced drilling program is likely to upgrade the ORS in the area drilled to a Measured Resource and Proven Reserve. Besides, the drilling campaign is expected to boost the geological knowledge and confirm the homogeneity as well as continuity that has been shown by previous drilling.
Environmental Approval Process
In March 2021, VRX Silica submitted its referral to the Department of Water and Environmental Regulation (DWER) for evaluation by the Environmental Protection Authority (EPA), seeking environmental approval for Arrowsmith North.
The Company’s referral incorporates its draft referral submitted in September 2020 and the pre-referral feedback obtained from the EPA in December last year. The referral concludes that the Arrowsmith North project can be developed without major residual impacts on the environment, given the implementation of mitigation measures, specifically the planned mining and rehabilitation methodology.
VRX Silica informed that the EPA’s environmental impact assessment is currently in progress. The Company is in communication with the EPA to make sure all the requirements are fulfilled. Importantly, thorough planning will enable the Company to deliver its silica sand projects efficiently and sustainably, with a very low carbon footprint.
With regards to environmental approval for the Arrowsmith Central silica sand project, VRX carried out additional environmental field surveys at the project during the quarter. These surveys were undertaken after feedback from the EPA in pre-referral meetings to secure environmental approvals for the advancement of the project.
During the quarter, the Company also continued with further studies and compilation of necessary data to support formal referrals to the Department of Agriculture, Water and Environment (DAWE) and DWER for environmental approval for the Muchea project.
Discussions with Potential Offtake Partners
During the quarter, VRX Silica continued discussions with prospective offtake partners for the sale of silica sand pproducts from the Arrowsmith North project. Notably, the Company continues to receive enquiries to purchase silica sand amid growing demand for the product. The Company believes that it is well-positioned to fill this demand.
As VRX Silica develops its silica sand projects, it will remain focused on delivering long-term dependable offtake partnerships with major industrial participants in the Asian market.
During the quarter, the Company also continued discussions with potential debt financiers for Arrowsmith North and other silica sand projects. It has instigated an Independent Technical Review by AMC Consultants to back the debt financing due diligence requirements.
VRX Silica issued a total of over 2.6 million new fully paid ordinary shares on conversion of options at different exercise prices, raising about AUD 332.1K in additional funds. Over 3.2 million new shares were issued subsequent to the quarter, raising an additional AUD 325K.
The Company closed the quarter with a decent cash balance of approximately AUD 8.8 million, which is enough to keep it going for an additional 10 quarters.
VRX Silica shares closed the trading session at AUD 0.285 on 3 May 2021.