Canada-headquartered tungsten miner Almonty Industries has announced that successful negotiations have taken place to amend its current offtake agreement for the Sangdong mine in South Korea, from 10 years to 15 years.
The original agreement, with US-based Global Tungsten & Powders, had a term of 10 years that called for floor price revenues for the company in a minimum amount of C$500M (US$376M). The amendment, taking the minimum term to 15 years, now calls for floor price revenues for the company in a minimum amount of C$750M (US$564M).
Sangdong is expected to be one of the largest capacity mine projects built in recent years with a design capacity of nearly 3.6ktpy contained W. Reserves are 7.89Mt grading 0.47% WO3, equivalent to 37.1kt contained WO3 (29.3kt W). Indicated resources are 8.3Mt at 0.49% WO3, equivalent to 40.8kt contained WO3 (32.2kt W).
In January 2019, Almonty secured US$76M from KfW IPEX-Bank to finance the project. The January announcement, combined with the amended offtake agreement, marks the final conditions for financing the project which is expected to come online in late 2021.
In addition to Sangdong, Almonty operates the Panasqueira tungsten mine in Portugal and reprocesses tungsten tailings at Los Santos in Spain. The construction of Sangdong would, therefore, give Almonty the second largest tungsten mine capacity (from all three operations) outside of China; the largest is held by Nui Phao in Vietnam.
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Image source: Almonty Industries