EQ Resources has refinanced €15 million of debt for its Spanish subsidiary through a three-year prepayment facility and locked in a five-year tungsten sales agreement valued at A$678 million.
- €15 million three-year prepayment facility secured with Traxys Europe
- Five-year marketing and distribution deal for 3,500 tonnes of WO3
- Remaining €5 million debt repaid from operational cash flow
- Agreement aligns debt repayment with tungsten production profile
- Deal valued at approximately A$678 million based on current tungsten prices
Debt Refinancing Aligns with Production
EQ Resources Limited (ASX: EQR), a global tungsten producer with operations in Australia and Spain, has successfully refinanced €15 million of debt for its wholly owned Spanish subsidiary, Saloro S.L.U. The company entered into a three-year prepayment facility with Traxys Europe S.A., a key player in commodity trading, which will be repaid through monthly set-offs against tungsten concentrate deliveries from its Barruecopardo Mine.
This refinancing marks a significant step in aligning the company’s debt obligations with its production profile, providing a more manageable repayment schedule and reducing financial pressure. The remaining €5 million of debt was already repaid from cash generated by Saloro in the December 2025 quarter, further strengthening the company’s balance sheet.
Long-Term Sales Agreement Secures Revenue Visibility
In tandem with the refinancing, EQ Resources signed a five-year marketing and distribution agreement with Traxys for 3,500 tonnes of tungsten trioxide (WO3) concentrate. Valued at approximately A$678 million based on current spot prices, this contract provides substantial revenue visibility and underpins the company’s growth strategy.
The agreement is priced at prevailing spot prices, referencing the industry-standard Fastmarkets Tungsten APT 88.5% WO3 CIF Rotterdam low price, ensuring that the company benefits from market movements while maintaining a stable sales channel. This partnership with Traxys is expected to enhance EQ Resources’ position as a reliable long-term supplier amid ongoing global geopolitical challenges impacting critical mineral supply chains.
Strategic Implications and Market Position
Managing Director Craig Bradshaw highlighted the significance of the deal, noting that it aligns the company’s debt profile with its production capabilities over a reasonable term and cost. The partnership with Traxys not only provides financial flexibility but also strengthens EQ Resources’ marketing platform, which is crucial as demand for tungsten intensifies in the new economy sectors such as renewable energy and advanced manufacturing.
With operations spanning the Barruecopardo Mine in Spain and the Mt Carbine project in North Queensland, EQ Resources is positioning itself as a key player in the critical minerals sector. The company’s focus on sustainable mining practices and advanced processing technology further supports its ambition to be a globally leading tungsten supplier.
While the announcement does not detail production forecasts or price sensitivity, the refinancing and sales agreement collectively reduce financial risk and improve revenue predictability, factors likely to be well received by investors and analysts.
Bottom Line?
EQ Resources’ refinancing and long-term sales deal set the stage for stable growth amid evolving global tungsten demand.
Questions in the middle?
- How will tungsten market price fluctuations impact the profitability of the sales agreement?
- What are the production targets at Barruecopardo Mine over the next five years?
- Could EQ Resources pursue further refinancing or expansion opportunities leveraging this deal?