RE:RE:RE:RE:RE:RE:Operational News......or lack ofYou are very welcome classicact
It is puzzling for sure, as Stuart Olsen was announced back in June 2019 as the General Contractor when awarded the phase 1 contract.
"Stuart Olson’s general contractor scope will include the construction of all above ground facilities, including concrete, steel and pipework, installation of equipment, electrical and control system work, building work and site finishing. Stuart Olson will mobilize to the project site in June 2019, with an anticipated maximum workforce of around 100 people on site. With their heritage in Western Canada and diverse experience, they have the skills, experience and resources to complete the project safely on budget and schedule."
Is Stuart Olsen filing liens on behalf of the sub contractors, as isnt it normal practice that the GC pay the sub contractors once work has been completed? It would be very helpful to see how much of Phase 1 money has been paid to Stuart Olsen to date.
The May 14, 2020 announced work stoppage came completely out of the blue, so did that have something to do with Stuart Olsen halting construction until the outstanding bills were paid?
The delay was blamed on Covid, "Unfortunately, the COVID-19 pandemic has caused economic issues on a global scale and as a result delayed our ability to complete the final tranche of funding as previously planned; this has slowed down our ability to complete construction for the balance of the plant."
but the phase 1 project construction is already 83% complete, with only approx $19.7 million remaining to complete the project, however would appear by corporate disclosure that a substantial portion of that initial 83% work completed has not been paid for.
"The Company through its subsidiary, Western Potash, has entered into various capital expenditure commitments for the procurement and construction of Phase I Milestone Project with a remaining committed amount of approximately $19,700,000."
On the bright side, if WRX can manually harvest the KCl already crystallized in the ponds, maybe the sale of that potash through the off take can offset some of the debt.
The sale / transfer of Milestone Phase 2 and 3 lands is certainly a bit cryptic, when considering WRX has an opportunity to buy it back at a later date, and the $8.3 million is not enough to make much of a dent in the overall outstanding debt.
It appears more like loan, using the land sold as collateral, but also keeping that land in safe hands, as the purchaser would hold said parcel titles as security.
Another month or so, and financials will be out once again, so maybe to corporation can shed a little more light on this confusing transaction.