EQ Resources receives EXIM letter of interest for Mt Carbine tungsten project in Queensland

[Redator]

Mt Carbine tungsten project in Queensland, Australia. Image: EQ Resources.

EQ Resources Limited (ASX: EQR) announced Friday that it has received a Letter of Interest to support the Mt Carbine tungsten expansion project from the Export-Import Bank of the United States (EXIM). 

The historic Mt Carbine tungsten mine is located in Far North Queensland — it was discovered at the end of the 19th century and was a major tungsten producer in the 1970s and 80s. The deposit is still relatively unexplored, and according to EQ Resources’ website, there is considerable exploration potential for new tungsten mineralisation in the mining leases and surrounding exploration tenements. 

Under EXIM’s new Supply Chain Resiliency Initiative (SCRI), the Letter of Interest states that EXIM is considering a 10-year debt facility of up to $34 million for the capital expansion and further development of the mine.  

EQ Resources, formerly Speciality Metals International, announced plans to double production capacity at its Mt Carbine operation as soon as funding has been secured.  

The company also holds 100% ownership of Saloro’s Barruecopardo tungsten mine in Spain.  

Long-lead items and key equipment for the planned processing plant expansion have been delivered to site, the company said, adding that the capacity expansion provides economies-of-scale and allows the operation to expand the throughput of low-grade ore from the historic low-grade stockpile (>10Mt) as supplement feed to the tungsten ore mined from the open pit and potential future underground. 

The 2022 Mt Carbine underground scoping study details a development plan for the long-term exploitation of the Mt Carbine tungsten deposit, noting that only 19% of the In-Situ Mt Carbine Mineral Resources are categorised as Ore Reserves and only those were modelled in the current open cut mining schedule.  

Tungsten’s emerging supply chain

The SCRI seeks to finance overseas mines to develop sources of critical minerals, reducing the United States reliance on China for critical minerals, reducing risk of supply chain disruption from China’s export bans, which sent tungsten prices on the European spot market to the highest level in 12 years last month.

Several countries classify tungsten as a critical mineral including the United States, the European Union and Australia. Tungsten is the material of choice for a key defense application – what the military calls penetrators – high-density, armour-piercing projectiles. Its also required in US Department of Defence (DoD) contracts. 

“We are pleased to work with US EXIM and our US customer base to strengthen resilience in a critical defence- and energy-related supply chain,” EQR executive chairman Oliver Kleinhempel said in a news release. 

“With two operating mines in Australia and Spain, EQR has positioned itself as a reliable and ambitious partner,” Kleinhempel said. “Recent geopolitical events and aggressive trade policies have contributed to a severe shortage of supply in the tungsten market. EQ Resources is positioned well with its Mt Carbine expansion plans to meet the demand of US customers.”