Q2 Financials / MD&A outSome of the highlights
The Company also invested in real estate development projects in the Greater Vancouver area, which, however, are in the process of liquidations and are expected to be liquidated by end of October 2021.
As at June 30, 2021, the Company has a working capital deficit of $57,634,961 including cash of $394,977. Furthermore, various vendors have filed builders’ liens for up to $33,100,672 against Western Potash as a result of its delayed payment on the outstanding payables related to mineral property, out of which a few vendors have also filed legal claims against Western Potash (Note 10). The Company’s legal counsel is currently working directly with the vendors on a temporary solution to mitigate legal action. Based on its current cash flow forecast and its existing obligations and commitments, the Company will require further funds for the completion of construction, to successfully commission the Milestone Project and to fund its general and administrative expenses for the remainder of the 2021 fiscal year.
Based on its current cash flow forecast, its existing obligations and commitments and the Credit Facility Agreement, the Company will require additional funds in fiscal year 2021 in order to complete construction and successfully commission Phase I and to fund its real estate investments and general and administrative expenses.
As of May 28, 2021 Hot Mining operations were temporarily suspended, while various plant workover, crystallization pond repairs and cavern optimizations are completed. A disposal well on the plant site is expected to be drilled before the end of the year. Once completed cavern pumping will re-commence along with an improved method of ramping up the caverns to full production. After extensive analysis of the data, and with the help of a number of solution mining experts, Western is developing an optimized solution mining plan.
The new plan will focus on increasing the solution mining efficiency and life span of the mining caverns. Western has engaged a third-party engineering firm to review operation plans and update its National Instrument 43-101 technical report. It is anticipated that the updated report will include an increase in the Project’s mine life from 12 to 40 years. Key findings of the report are expected to be released by mid-October 2021.