Approval expected for tungsten mine

Exploration firm Ormonde Mining expects to receive full approval for its breakthrough Spanish-based tungsten project in August, paving the way for first commerciality in late 2015.

The Clonee-headquartered firm’s chairman, Mike Donoghue, said, yesterday, management anticipates the formal mining concession for the Barruecopardo project to be issued “shortly”.

The concession is the last in a long line of regulatory hurdles to be overcome for the highly-anticipated project near the city of Salamanca. Following this, Ormonde will embark on a 14-week period of commissioning the mine, with it due to be fully commissioned in October 2015.

First commercial ‘flow’ is expected at least six weeks after that, meaning Barruecopardo should be fully up and running late next year. This August will also see the mine fully funded, via a bond issuance.

Ormonde has already reached agreement to sell all production from Barruecopardo for the first five years of the mine’s life; with the buyer — Singapore-based investment holding company, Noble Group — also having the option to extend that agreement.

It has been speculated that Barruecopardo could supply 8% of all tungsten (which is chiefly used in the aerospace sector) sourced outside of China, which is the leading supplier of the metal. The firm expects to generate net revenues, based on current tungsten prices, of over $350m (€259m) over the initial five years of production. Tungsten prices, currently $375 per metric tonne, are expected to remain strong over the coming years.

Ormonde’s update coincided with the publication of its latest set of annual results. These showed a near 60% year-on-year drop in pre-tax losses for 2013, to €1.8m.

Mr Donoghue said “considerable progress” had been made at Barruecopardo in the past year, despite last year’s hostile takeover approach from Almonty Industries. Yesterday’s update also showed further positive drilling results from its gold prospects in Spain.