EQ Resources Limited, a global tungsten producer with a strong presence in Australia and Spain, has announced a significant development regarding its Spanish operations. The company disclosed that its major shareholder, funds managed by Oaktree Capital Management, L.P., will extend the current financing guarantees for its wholly-owned Spanish subsidiary, Saloro S.L.U., until the end of 2025. This extension concerns €20 million out of the original €25 million in Letters of Credit that secured credit facilities provided by Banco Santander S.A. and CaixaBank S.A., which had a balance of A$41.4 million as of 31 December 2024. The announcement comes as a follow-up to EQ Resources Limited’s August 2023 acquisition of European tungsten producer Saloro from Oaktree. Saloro’s flagship asset, the Barruecopardo Tungsten Mine in the province of Salamanca, is noted as the largest tungsten mine in Europe. The positive news is underpinned by record production levels achieved in the Barruecopardo mine towards the end of 2024, which helped Saloro post an unaudited positive EBITDA of EUR4.4 million (equivalent to A$7.84 million) over the Q4 2024 to Q1 2025 period on a stand-alone basis. Encouraged by these operational and financial improvements, EQ Resources Limited has begun discussions with Spanish banks to restructure its credit facilities for the future. This move is aimed at replacing the current arrangements provided by Oaktree as those credits roll off, while simultaneously reducing outstanding loan amounts to strengthen the overall balance sheet. Executive Chairman Oliver Kleinhempel expressed satisfaction with the ongoing support from Oaktree and highlighted the ideal timing to secure multi-year term facilities in response to the improving tungsten price environment. Bullish sentiment arises from the company’s operational improvements, record production levels, and demonstration of positive EBITDA performance at Saloro, all of which signal enhanced efficiency and profitability. Additionally, the proactive engagement with leading Spanish banks to restructure credit facilities is viewed as a forward-looking step towards reducing leverage. On the other hand, bearish concerns may center on the dependency on credit extensions and the challenges of transitioning to new funding arrangements once Oaktree’s support ceases, which could introduce potential risks if market conditions fluctuate or if the restructuring negotiations face delays.