Metal works located by railway (7)
I believe the answer is:
foundry
'metal works' is the definition.
'foundry' can be an answer for 'works' (foundry is a kind of works). I'm not certain of the 'metal' bit.
'located by railway' is the wordplay.
'located' becomes 'found' (I've seen this in another clue).
'by' means one lot of letters go next to another.
'railway' becomes 'ry' (abbreviation).
'found'+'ry'='FOUNDRY'
Can you help me to learn more?
(Other definitions for foundry that I've seen before include "Factory for casting metal" , "Metal workshop" , "Ironworks" , "Metal casting shop" , "Iron-casting works" .)