Tungsten West to Raise Tens of Millions of Pounds

Introduction to the Project

The London-listed company, which plans to mine one of the world’s largest tungsten deposits at a site in Devon, is in talks with investors to raise tens of millions of pounds through a share sale. This move is aimed at providing additional funding for its Hemerdon tin and tungsten project in Devon.

Capital Raising

Industry sources suggested the capital raising, which is expected to secure between £40m and £50m of new funding, is expected to be confirmed this week. The fundraising comes at a time when global demand for critical minerals is surging amid rising geopolitical tensions.

Importance of Tungsten

Tungsten is an important mineral used by manufacturers in various industries, particularly defense, energy, and automotive. Currently, China is responsible for producing about 80% of the world’s tungsten supply, but export controls have raised major concerns in Western economies.

Global Demand and Production

Just this week it was announced that the US plans to invest $12 billion in stockpiling critical minerals such as rare earths, copper, and lithium. Tungsten West expects the company to be able to produce about a quarter of the world’s non-Chinese tungsten over time.

Progress and Market Update

The company entered the London junior AIM market in 2021 with the aim of resuming tin and tungsten production at the Devon site. In an update to the stock market earlier this week, the company said it was making good progress in raising debt funding for the project. The structural change in the tungsten market reflects the ever-growing need to provide Western economies with critical mineral diversification and supply chain resilience.

Market Performance

The economics of the project have improved significantly, underlining the importance of rapid development of the project. Shares closed at 29.9p on Wednesday, up almost 13%. The market value is just over £205 million. The price at which the new shares would be issued was unclear.