Proactive Investors - Westwater Resources Inc (NYSE:WWR) has highlighted major milestones achieved in 2023, which it believes has put the US-based natural graphite company in a strong position for this year.
“We believe 2023 was a year of significant progress across our graphite business, which was the result of tremendous hard work by the Westwater team,” Westwater executive chairman Terence J. Cryan said in a statement.
The company pointed to the execution of its first off-take agreement with South Korean EV battery maker SK On for its coated spherical purified graphite (CSPG).
“We believe customer interest is accelerating in Westwater as a stable, US-based supplier of natural graphite,” Westwater chief commercial officer Jon Jacobs commented.
“Customer interest and market demand for domestic CSPG remains strong, and customer interest in Westwater is due to the combination of our SK On off-take agreement, foreign entity of concern-related guidance requiring EV tax credit eligible vehicles to use of Inflation Reduction Act (IRA)-compliant graphite by 2025, and new Chinese export restrictions on graphite that have reduced stability of supply.”
The company also noted that, after completing a debottlenecking study, it has increased its Phase 1 production for coated spherical purified graphite at its Kellyton, Alabama, plat to 12,500 metric tons per year while maintaining its construction budget at $271 million.
Since Phase 1 construction has started at the Kellyton plant, the company said it has invested $119.2 million in the project. It is continuing its efforts to secure debt financing to fund the balance of the estimated capital requirements to complete Phase 1 construction.
Westwater CFO Steve Cates commented: “We are continuing to engage with third parties interested in funding our project, and those parties have indicated they are pleased to see we have our first off-take agreement in place.”
The company excited 2023 with a cash balance of $10.9 million and working capital of $3.8 million.
Its consolidated net loss for the year was $7.8 million or $0.15 per share, down from $11.1 million or $0.25 per share in the previous financial year. This decrease was attributed to a $3.1 cash settlement from the Republic of Turkey, a $1.2 million write-off of accrued uranium royalties, a $0.3 million increase in interest income and $0.5 million less in exploration expenses offset by $1.8 million higher product development expenses associated with additional sample production.
Shares of Westwater Resources traded higher on the update, adding 7.1% at $0.52 in early trade on Wednesday.
Westwater Resources is focused on developing battery-grade natural graphite. Its primary project is the Kellyton graphite plant which is under construction in east-central Alabama.