How VRX Silica Cleared Environmental Hurdles to Unlock Arrowsmith North

Environmental Approval Milestone Achieved

VRX Silica Limited has reached a pivotal regulatory milestone in the development of its Arrowsmith North Silica Sand Project, located roughly 270 kilometres north of Perth. Following a formal appeal lodged against the Environmental Protection Authority's (EPA) assessment report earlier this year, the Office of the Appeals Convenor (OAC) has completed its investigation and submitted its findings to the Western Australian Minister for Environment.

In late June 2025, the Minister confirmed the EPA's assessment was adequate and consistent with policy frameworks, allowing the project to proceed without further environmental review. While the appeal was allowed in part, amendments to conditions addressing dieback were accepted by VRX, marking the conclusion of this regulatory hurdle. The company now awaits formal notification of project approval under the Environmental Protection Act.

Offtake Agreements Signal Market Demand

Alongside regulatory progress, VRX has secured non-binding offtake interest for an aggregate of 640,000 tonnes of certified silica sand products, including foundry sands and premium glass sand. These agreements involve established suppliers in key Asian markets such as South Korea, Japan, and Taiwan, reflecting robust demand for high-quality silica sand in the region.

Indicative pricing aligns with VRX's financial modelling from its updated bankable feasibility study, targeting a production schedule of 2.2 million tonnes per annum over the mine life. The company continues to engage with existing and new potential offtake partners, underscoring strong market interest as final approvals approach.

Financing Discussions Gain Momentum

With environmental approvals nearing completion, VRX has intensified its efforts to secure project financing. The company has appointed Argonaut PCF as financial advisor to explore debt and offtake financing options. Interest from potential lenders has increased markedly, prompting VRX to finalize an independent technical review to support financing negotiations.

This financial momentum is critical as VRX prepares to transition from development to production, aiming to capitalise on the growing silica sand supply shortfall in the Asia-Pacific region. The company’s strong mineral resource and ore reserve base across its Western Australian projects further underpin its growth potential.

Operational and Financial Overview

During the June 2025 quarter, VRX maintained exploration and evaluation activities, with expenditures primarily related to tenement rents and environmental approvals. No substantive mining production occurred in the period, consistent with the project’s development stage. The company surrendered one exploration licence but continues to hold 100% interests in key tenements across its Arrowsmith, Muchea, and Boyatup silica sand projects.

Cash flow reports indicate a net cash outflow from operating activities, balanced by financing inflows, leaving VRX with a solid cash position to support ongoing development. Payments to related parties were limited to directors’ fees and salaries, reflecting standard corporate governance practices.

Strategic Outlook

Arrowsmith North is positioned to become a cornerstone project for VRX, with a minimum 25-year mine life and the capacity to supply multiple silica sand products to a growing Asian market. The project enjoys broad stakeholder support, including indigenous groups, local governments, and industry bodies, enhancing its social license to operate.

As VRX awaits formal project approval, the company’s focus will likely shift towards finalising financing arrangements and converting offtake interests into binding contracts. These steps will be crucial to unlocking the project’s full economic potential and delivering long-term benefits to Western Australia’s Mid West region.