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Tungsten projects

Coffee with Samso Episode 1 with Mark Strizek

In this segment, Samso and Mark Strizek discuss why Australian projects may have CAPEX advantages over the other projects in the world.  As I mentioned before, in the tungsten project world, the possibility of success is few and far between due to the complexity and geological nature of the deposits.  There are only a handful of good deposits that will be able to carry substance over the life of Mine.

The Cantung mine and Mactung Deposit.

The Cantung and Mactung deposits are extremely high-grade, but they are no longer in operation due to the high OPEX for both mines.  When Cantung was in service, it was by far the highest-grade producing mine.

Cantung and Mactung Tungsten Deposit | Coffee with Samso
Cantung and Mactung Tungsten Deposit (Source:NATC)

Mining reserves were grading in the 0.80% range as you can see in the table below. The Probable Mineral Reserves table from the website of the now-bankrupt company, North American Tungsten Corporation Limited is listed below.  Final products include a premium gravity concentrate (G1), containing on average, 65% WO3; a flotation concentrate containing, on average, 35% WO3 and a copper concentrate averaging 28% Cu.

Probable Mineral Reserves, July 21, 2014

The Mactung deposit was never mined, from what I can remember. I could be very wrong here.

The project had a resource of 33Mt @ 0.88%WO3.  The Mactung Project was forecast to run at 2,000 tonnes per day from an underground operation using conventional long hole plus cut and fill mining methods. The ore will be processed into both a premium gravity concentrate (67% WO3) and a flotation concentrate (55% WO3).

Key parameters that form the basis of the economic evaluation of the Mactung Project.  (Source:North American) | Coffee with Samso
Key parameters that form the basis of the economic evaluation of the Mactung Project. (Source:North American)

According to the information on the North American Tungsten website, the Mactung deposit fact sheet indicated that the Feasibility study came up with the following points,

Mine life is 11.2 years for the underground mine with the potential to expand by 17 years with an open pit, exploiting near the surface, lower grade indicated and inferred mineral resources.
The capital expenditure estimate is comprised of a project capital cost of CDN$356.5 million plus a contingency of CDN$45.6 million.
Based on an 11.2-year mine life and the base case parameters, the project’s pre-tax net present value is calculated as follows: Discount Rate Pre-Tax Net Present Value 8% CDN$276.8 million 6% CDN$346.4 million

The development cost for the mine is high, and with the current tungsten price, one would argue that such high risk would not be helping owners of the project to find capital.

Barruecopardo Tungsten Project

The Barruecopardo Tungsten Project by Ormonde, which appears to be a low-cost tungsten mining project is now in the advanced stage of construction. When fully operational, Barruecopardo will account for around 13% of the non-Chinese global supply of tungsten concentrates.

Baruecopardo Tungsten Deposit (Source: | Coffee with Samso
Baruecopardo Tungsten Deposit (Source:

The new mine development is based on an initial open pit mining operation with a 9-year mine life, producing 260,000 metric tonne units (“mtu”) of tungsten trioxide (WO3) per year, or 2,060 tonnes of tungsten metal, contained in a high-quality concentrate, following a one year ramp-up period.

Ormonde holds a 30% interest in the Project company, Saloro SLU, which is funded to develop the mine through a US$100 million financing package provided by funds managed by 70% joint venture partner Oaktree Capital Management.

This project has taken a long time to get to this stage. Around 2013, this project was already ready to be mined, but for some reason, it never happened.  In my time within the tungsten industry, I have always wondered why several of these “better grade” deposits/projects never happened.

The Sangdong Mine

(Source: Wikipedia)

The Sangdong mine located in South Korea is one of the largest tungsten mines in the world.  The Sangdong tungsten deposit was discovered in 1916.  The mine is located 187 km southeast of Seoul, approximately three hours’ drive via expressways and local sealed high ways. Temperatures rise to a maximum of about 30℃ during the wet summer months of June to August. The winter period is relatively dry and extends from October to March, with freezing temperatures occurring during the period December to March.

The Sangdong mine located in South Korea is one of the largest tungsten mines in the world. (Source: Wikipedia) | Coffee with Samso
The Sangdong mine located in South Korea is one of the largest tungsten mines in the world. (Source: Wikipedia)

After a decade from mine closure,  mining rights of Sangdong mine were acquired by Woulfe Mining Corporation via Sewoo Mining Corporation in 2006 and established its wholly owned subsidiary, Almonty Korea Tungsten Corporation (ex-Sangdong Mining Corporation).

Scheelite ore of Sangdong mine. (Source: Wikipedia) | Coffee with Samso
Scheelite ore of Sangdong mine. (Source: Wikipedia)

Almonty Industries, specialising in tungsten projects with operation mine in Spain, Australia and Portugal, completes the acquisition of Woulfe Mining Corporation in September 2015. All information and data along with many detail investigation and analysis about Sangdong mine which had been closed for over 15 years were well organised and summarised in the “Feasibility study” and “NI 43-101 Technical report” drawn up by Almonty Industries.

Resource information for the Sangdong Tungsten Deposit. (Source:ALMONTY INDUSTRIES) | Coffee with Samso
Resource information for the Sangdong Tungsten Deposit. (Source:ALMONTY INDUSTRIES)

The Sangdong project was the project that sparked a lot of interest due to the link of Warren Buffett.  One of his companies was looking at the project and created a lot of attention.  Structurally it has some complexity, but as Mark mentioned, it looked like Almonty has worked out what they need to do.

While we are mentioning Almonty, it is also appropriate to say that they are the only company that has multiple mineable tungsten projects.  They also own the Los Santos project in Spain and the Panasqueira Mine in Portugal.


I could go on for a long time talking about all these deposits, but I hope this will give readers a start if more research is your thing.  Otherwise, I hope I have given some context to this segment of my conversation with Mark Strizek.  I have included the links to the other parts below.

The tungsten industry is a very small unique sector as there are only a handful of players and the opaque nature of the tungsten pricing and the market, in general, makes it hard for investors to find a good company to back.  I am guessing that the Australian projects will soon become world players once this uncertainty starts to settle down.


You can view the other segments of the conversation via the links below.

Individual Segments for Episode 001




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