How EQ Resources’ €15M Deal with Traxys Could Reshape Its Tungsten Future
EQ Resources Limited has locked in a €15 million three-year prepayment facility with Traxys Europe S.A., coupled with a five-year offtake agreement for tungsten concentrate from its Spanish mine, strengthening its financial footing and market position.
- €15 million three-year prepayment facility signed with Traxys Europe S.A.
- Five-year offtake agreement for minimum 7,000 tonnes of tungsten concentrate
- Facility proceeds to refinance existing debt of wholly owned subsidiary Saloro S.L.U.
- Pricing indexed to APT commercial tungsten price
- Definitive agreements targeted for Q1 2026, subject to conditions precedent
Strategic Financing to Strengthen Balance Sheet
EQ Resources Limited (ASX – EQR), a notable player in tungsten mining with operations spanning Australia and Spain, has entered into a binding three-year €15 million prepayment facility with Traxys Europe S.A. This financing arrangement is designed to refinance existing debt held by its wholly owned Spanish subsidiary, Saloro S.L.U., which operates the Barruecopardo tungsten mine.
The facility is structured with a repayment mechanism based on set-offs from monthly deliveries of tungsten concentrate, providing a clear link between production and debt servicing. The initial six months include a grace period with no principal repayments, while interest is calculated at EURIBOR plus 5.5%. This structure offers EQ Resources breathing room to stabilise cash flows as it advances operations.
Securing Long-Term Offtake and Market Access
Alongside the financing, EQ Resources has agreed on a commercial five-year offtake contract with Traxys for a minimum of 7,000 tonnes of tungsten concentrate (WO3) from Barruecopardo. The pricing is indexed to the APT (Ammonium Paratungstate) commercial price, aligning revenue with market conditions and providing transparency for investors.
This offtake agreement not only guarantees a steady customer for EQ Resources’ production but also strengthens its partnership with Traxys, a global supply chain management leader in metals and minerals. The collaboration is expected to enhance market certainty and support the company’s growth ambitions in the critical minerals sector.
Outlook and Next Steps
The definitive financing and offtake agreements are targeted for execution in the first quarter of 2026, subject to customary conditions precedent including confirmatory due diligence and regulatory approvals. Proceeds from the facility will be used to repay outstanding debt, reducing financial risk and improving the company’s capital structure heading into 2026.
Managing Director Craig Bradshaw highlighted the significance of this transaction as a forward step in reducing overall debt and securing a strong partner in Traxys. The move is expected to provide EQ Resources with greater financial flexibility and operational certainty as it navigates the evolving tungsten market.
While the notional value of the offtake is indicative and not a revenue forecast, the deal signals confidence in the company’s production capabilities and the long-term demand for tungsten, a critical mineral for emerging technologies and industrial applications.
Bottom Line?
This financing and offtake deal marks a pivotal moment for EQ Resources, setting the stage for debt reduction and strengthened market positioning in 2026.
Questions in the middle?
- What are the specific conditions precedent that could delay or derail the definitive agreements?
- How will fluctuations in the APT tungsten price impact EQ Resources’ revenue and cash flow under the indexed pricing model?
- What are the implications of this refinancing on EQ Resources’ credit metrics and future capital raising capacity?
