Tungsten prices hold up as Group 6 Metals presses on with mine construction at King Island
Group 6 Metals is targeting first production from its Dolphin tungsten mine early next year.
Tungsten prices are holding steady in spite of falling Chinese demand due to covid lockdowns, reports emerging producer Group 6 Metals (ASX: G6M).
Meanwhile, the company is working toward producing its first tungsten from the Dolphin mine on King Island in the first quarter of 2023.
In addition, Group 6 will be burnishing its ESG (environmental, social, governance) credentials later this year as it works with the University of Tasmania to develop environmentally sustainable production of critical minerals, including tungsten.
The Dolphin mine contains one of the highest-grade tungsten deposits outside of China. The mine has direct access to the Port of Grassy through which it will export tungsten concentrate to European offtake partners.
European tungsten producers hit hard by rising energy costs
Group 6 says ammonium paratungstate (APT) prices remain high, with buyers still prepared to between US$344 and US$350 per metric ton unit (10kg).
This resilience comes at a time when China’s downstream processing sector has faced disruptions due to Covid lockdowns on the mainland.
Most of the Chinese mines are located outside the regions affected by a return of the coronavirus emergency restrictions but the end users are in those affected regions, having suspended operations and thus caused an oversupply of concentrate.
Chinese concentrate producers are not permitted to export any of their output.
Group 6 says APT demand in Europe and the US remains strong.
But high energy costs in Europe have seen several concentrate producers suspending operations or delaying development plans.
University partnership could deliver improved tungsten recovery
The company is working with the University of Tasmania’s Environmentally Sustainable Production of Critical Minerals project.
The university’s Centre for Ore Deposit and Earth Sciences has received a grant of $3.5 million to investigate environmentally sustainable production of critical metals.
Group 6 is one of several Tasmanian-based mining companies collaborating with this effort.
The company is allowing access to the university team at its Dolphin mine now under construction, as well as to the historic Bold Head mine and Group 6’s exploration tenements.
It says the benefits from working with the university will include enhanced recovery of tungsten, potential to recover additional tungsten from low grade ore and mine waste, thus widening the range of tungsten products it can offer.