Tungsten West has signed an eight-year supply agreement with US producer Elmet Technologies, securing a long-term route to market for its Hemerdon mine in Devon and deepening a UK-US critical minerals partnership.
Under the deal, the AIM-listed miner will supply Elmet, part of The Elmet Group, with 1,000 tonnes a year of contained tungsten over the eight-year term.
Blair McDougall, Minister for Reindustrialisation for the United Kingdom, said: “This announcement builds on our partnership with the United States, working together in areas like mining and processing, helping crucial sectors like defence and clean energy in both countries get the minerals they need.”
Tungsten West put the agreement’s indicative value at more than £1.4bn at current prices and exchange rates, though it stressed this was not guaranteed revenue, since actual proceeds will depend on tungsten prices, currency movements, volumes delivered and a variable pricing mechanism.
Tungsten West shares rose 8% in an immediate reaction on Wednesday.
The company said Elmet could also process an additional 500 tonnes a year, at Tungsten West’s request, to support UK government and industry needs.
In August, the National Wealth Fund agreed to invest up to £71m in Tungsten West, with an option to buy up to half of Hemerdon’s tungsten output.
“This is a landmark commercial agreement for Tungsten West and represents a major step in establishing Hemerdon as a strategically important source of tungsten for the Western world,” said Jeffery Court, CEO of Tungsten West.
“The eight-year agreement outlines the supply of 1,000 tonnes of contained WO₃ annually and at current tungsten market prices, has an indicative nominal value of over £1.4 billion.”