Almonty starts operations at Sangdong tungsten mine in South Korea

[Ben Graham]

Almonty Industries (NASDAQ: ALM) (TSX: AII) (ASX: AII), announced Tuesday the first truckload of ore has been successfully delivered at the Sangdong tungsten mine in South Korea, marking the beginning of active mining operations and the final step before commencement of commercial production. 

Crushing, milling, and flotation circuits are proceeding as planned and support a smooth ramp-up toward full production, the company said.  

The deposit, located in the northeastern province of Gangwon, is said to host one of the largest tungsten resources in the world, along with one of the highest grades. Total reserves are measured at 7.9 million tonnes averaging 0.47% tungsten oxide (WO3), for 3.7 million contained metric ton units. 

Sangdong had been spearheading the economy in the post-Korean War decades, contributing more than 50% of the country’s export revenue. The mine closed in the 1990s primarily due to low commodity prices. 

Almonty bought the asset when the US stopped mining tungsten in 2015 and has been working to bring it back into production for a decade.  

The Canadian miner has said the Sangdong restart represents a “significant milestone” in the resurgence of Korea’s position as a key player in the global tungsten market, as a resumption would “significantly mitigate” the Western world’s dependence on tungsten produced within China. 

Since 2018, tungsten has been designated and managed as a critical mineral by the US government for its use in defense applications, and its rival China dominates over 80% of the metal’s supply chain.  

Tungsten’s emerging supply chain

“This first ore placement represents a strategic inflection point in advancing Almonty’s mission to strengthen the global tungsten supply chain,” CEO Lewis Black said in a news release.  

“Sangdong plays a critical role in efforts by the United States, the European Union, and Korea to diversify away from the China-dominated market, which currently supplies more than 80% of the world’s tungsten,” Black said.  

“The resumption of production at the Sangdong Mine forms the foundation for securing reliable, non-China tungsten supply to key sectors such as defense, semiconductors, AI hardware, aerospace, and other high-technology industries.”  

Black said the Sangdong mine is the foundation of a new tungsten supply chain for the US and its allies beyond Chinese control, as well as returning Korea to its historic role as a key supplier.  

Almonty’s stock was up 9% on the Nasdaq by market close. The company has a $2.79 billion market capitalization.