Red River extends offtake agreement

POLYMETALLIC producer Red River Resources has renewed a three-year-old agreement with one of the world’s largest commodity traders.
Red River extends offtake agreement Red River extends offtake agreement Red River extends offtake agreement Red River extends offtake agreement Red River extends offtake agreement

Concentrate production at Thalanga

Haydn Black

Reporter

Trafigura will take all of the lead and zinc concentrate from Red River's Thalanga operation in Queensland for a further three years starting from January 2021.
 
The Swiss-based trader has also agreed to a new US$15 million working capital facility, with an additional $5 million being made available on the same terms.
 
Red River drew down $6 million in March to support development at Thalanga, and repaid it in September.
 
The original agreement was secured in 2017 to help Red River resurrect the Thalanga plant and West 45 mine. 
 
Red River now produces copper, lead and zinc concentrate from the Far West underground, with production increasing over the past quarter, generating earnings of $13.8 million. 
 
The junior expects to start producing gold from its Hillgrove gold operation in New South Wales before the end of the year, initially targeting stockpiled ore. 
 
Copper production broke a record of 4073 tonnes in the September quarter, with 7026t of zinc concentrate and 1947t of lead concentrate.
 
The offtake will continue to be trucked 200km to the Port at Townsville, and pricing will be determined using the London Metals Exchange values.
 
The company had a cash balance of $12.5 million at the end of September.
 
Red River's stock was down 3.5% in afternoon trade to A27.5c, valuing it at $142.4 million. The minder's shares peaked at a two year high of 31c last week.