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Tungsten: Project Development Continues Apace, Despite Price Slowdown

Commentaries & Views

The start of July saw several announcements from tungsten developers across the globe, pointing to the strong fundamentals for tungsten supply and demand, in spite of the slowdown and drift in prices since the start of the year.

In Australia, Speciality Metals International (SMI) completed the acquisition of Mt Carbine Quarries and several mining leases held by the company. The Mt Carbine site was a past-producing tungsten operation and the site comprises, in addition to the current quarry operations, tailings dams (2Mt grading 0.1% WO3) and a low-grade stockpile (12Mt), plus around 6Mt of mineralised ore sorting rejects. SMI has also entered into a joint venture with Cronimet Asia and the two partners aim to commence tungsten production initially via a tailings retreatment project, starting in late 2019.

Meanwhile, in Canada, the large-scale and long-life Sisson tungsten-molybdenum project under development by Northcliff Resources received a key federal authorisation. The Metal and Diamond Effluent Regulation Schedule 2 amendment (MDMER) process was completed, which incorporated a review of the placement of the tailings facility and the tailings technology, in addition to a fish habitat compensation plan.

There was also news from earlier stage projects, including the announcement from TNT Minesthat it had signed a binding letter of intent with Canadian company TinOne Resources for the sale of its tin-tungsten assets in Tasmania, for a consideration of A$1.1M. TinOne already has a portfolio of tin exploration projects in New South Wales.

Roskill View

Tungsten market conditions have been more challenging in 2019, following a robust period of growth in 2017 and 2018, as a result of falling Chinese automotive production – impacting demand for key tungsten-containing tools – plus uncertainty around the US-China trade dispute and concern over Chinese tungsten stockpiles from the failed Fanya exchange. Longer term prospects for the sector are strong, however, with key end-use markets all poised to increase consumption. With tungsten supply from existing tungsten mines set to fall back over the next decade, Roskill forecasts that at least 10 new large-scale tungsten mines will be required over this period in order to meet demand.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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