North American Tungsten – Western World’s Largest Producer of Tungsten Concentrate
Overview
North American Tungsten (TSXV:NTC) is a publicly traded resource company engaged primarily in the operation, development, and acquisition of tungsten and other related mineral properties in Canada. The Company’s Cantung mine and Mactung project make it one of the few tungsten producers with strategic properties outside of China.
Investment Highlights
- An increased demand for tungsten in world markets, at a time when China have cut their exports of tungsten by almost half
- The price of tungsten has doubled in the last eighteen months
- The Cantung Mine is the Western World’s largest supplier of tungsten concentrates
- The Mactung project represents one of the world’s largest undeveloped high grade tungsten-skarn deposits
- Over 38 million spent on Cantung mine efficiency upgrades
- Extensive knowledge in Tungsten exploration and production
Key Projects
Mactung Project
The Mactung property is located in the Yukon in the Selwyn Mountain Range and covers the area around Mt. Allan, approximately eight kilometres northwest of MacMillan Pass. The nearest settlement accessible by road, Ross River, is 250 km away to the southwest along the North Canol Road. The Cantung Mine is approximately 160 km to the south.
The Company’s valuable experience in developing and operating the Cantung mine will aid significantly in development of the Mactung deposit. The permitting process is well underway, and the Company has seen growing interest in the Mactung deposit from a number of international mining companies.
The feasibility study completed in 2009 had the project economically viable at $300 dollar tungsten per metric tonne, its current spot price is $430. The project features payback in only 2.9 years, and an IRR of 23.4%. Mine life is projected at 11.2 years for the underground mine with the potential to expand by 17 years with an open pit, exploiting near surface, lower grade indicated and inferred mineral resources.
Cantung Mine
The Cantung Mine is located in the western Northwest Territories, Canada, approximately 300 km by road northeast of Watson Lake, Yukon. The mine is a primary producer of tungsten concentrate from open pit and underground mines sources. It first opened in 1962.
Cantung Mine began to capitalize on the new infrastructure built during 2011, where significant investments were made to improve tungsten recovery, increase mill availability, improve power supply, reduce power generation expenses, and finally augment ore development.
Mill averages, and tungsten recovery have exceeded expectations, and market prices have continued to be relatively stable. For the first half of fiscal 2012, the Company reported net income of $9.1 million.
As part of its continuing investment plan in the first half of fiscal 2012, North American Tungsten spent $13.1 million in capital improvements, to further develop the Cantung deposit, and extend the life of the mine. Continuing capital expenditures will complete this development phase of and provide a significant source of ore well into the future; increased recovery from tailings should also add to the bottom line.
The Company’s current diamond drill program at the mine is focused on the outer edge of the defined deposit. High-grade tungsten intercepts discovered during drilling require immediate follow up drilling, as reported in February 6, 2012 and June 6, 2012 news releases. This will be the focus of the next phase of drilling as soon as drill sites can be accessed.
Summary
North American Tungsten is the Western World’s largest producer of tungsten concentrate. Demand for tungsten is increasing at a time when China is cutting exports significantly. Market prices and demand for tungsten are strong and are expected to remain stable. The Company’s producing asset, the Cantung Mine continues to defy its mine life cycle, having only three years left in its perceived life, eight years ago. Continued upgrades at the mine have seen efficiencies created, and the mines’ life extended into the foreseeable future. The company made a net profit of 6.6 million CDN, and is poised to put the Mactung project into production.
Management
Stephen M. Leahy – Director, Chairman of the Board, and Chief Executive Officer
Mr. Leahy has more than 26 years experience in venture capital, primarily in the resource sector, and he has been instrumental in the formation, financing and development of a number of public and private corporations. Mr. Leahy has previously acted as a senior officer or director of StarTech Energy Inc. (TSX), First Silver Reserve Inc. (TSX) and Wellco Energy Services Inc. (TSX). As founder of North American Tungsten Corporation Ltd., he was instrumental in facilitating the Company’s acquisition of its wholly-owned Cantung mine and Mactung deposit.
Christina Scott – Director and Corporate Secretary
Ms. Scott provides in-depth knowledge of the continually evolving securities regulatory environment, acquired during more than 20 years experience serving with public companies in regulatory and financial reporting capacities.
Kenneth Collison – Director
Mr. Collison recently retired as COO of Thompson Creek Metals Company (“Thompson Creek”) where he was instrumental in helping to build one of the World’s largest Molybdenum Mining Companies from 2005 to 2009.
Prior to his position with Thompson Creek, Mr. Collison was Vice President and General Manager of Coeur d’Alene Mines Corp. from 1996 to 2000, responsible for all areas of the development of the 200,000 ounce per year Kensington Gold Mine. After receiving his B.Sc. in Mining Engineering and his Masters of Engineering in Mining from the University of Saskatchewan, Mr. Collison held management positions at several projects before joining Crandon Mining Corporation, a Rio Algom/Exxon Coal minerals partnership in 1994 as Vice President.
Ronald Erickson – Director
Mr. Erickson is Chairman and Chief Executive Officer of Holiday Companies, a private business entity owning, operating and franchising 450 gasoline/convenience stores along the Northern Tier and Alaska, real estate investments and a technology company, Cellresin Technologies. Mr Erickson’s additional involvement includes: Chairman of Queenwood, LLC; Vice Chairman of the Board of Gander Mountain; Chairman of the Board of BioE; Director of Carriage Services, and Director of the National Petroleum Council, an advisory body to the Secretary of Energy. Mr. Erickson previously served as a Director of Andersen Corporation, a private manufacturing company which is the largest seller of windows and doors in the United States; and as a Director of First Bank, National Association (now U.S. Bank) located in Minneapolis. Mr. Erickson is a graduate of The Blake School, University of Minnesota, B.A.; University of Minnesota Graduate School of Business; and the University of Minnesota School of Law, J.D.
Kurt Heikkila – Director
Mr. Heikkila is President of Wild River Consulting Group, the founder and President of Tundra Companies and is one of the three Governors of Tungsten Diversified Industries LLC. In 2003, Mr Heikkila founded the Tundra Group of Companies, dedicated to the development of new composites for lead replacement most of which utilize Tungsten as the primary material. In addition to his distinguished business career, Mr. Heikkila has personally received 42 patents, the majority of which relate to new composite materials. Mr. Heikkila attended Concordia College earning his BA in Physics and Chemistry and received his M.S. in Chemistry from the University of Minnesota.
Allan Krasnick – Director
Mr. Krasnick is a senior corporate and commercial lawyer in Vancouver, B.C. In the course of a varied practice during his 25 years as a lawyer, he has negotiated complex business transactions in a number of industries and concluded many agreements with First Nations, private clients and government. Mr. Krasnick has also concluded dozens of collective agreements in the public and private sector and is one of Canada’s senior practitioners in entertainment law. He has advised government on public policy and tax matters. Mr. Krasnick’s clients have included many Fortune 100 companies.
Wayne Lenton – Director
Mr. Lenton enjoys over 40 years experience in domestic and international mining operations. A graduate metallurgical engineer, his experience includes more than 15 years in senior executive capacities with the AMAX group of companies. As President of Canada Tungsten Mining Corporation, Mr. Lenton led a management team that was responsible for the Cantung mine and the feasibility and mine planning for the Mactung project. He is a Past Chairman of the International Tungsten Industry Association and the Mining Association of British Columbia. He is a member of the Society of Mining Engineers and the Canadian Institute of Mining and Metallurgy, and also serves as a director of Eldorado gold Corporation and Energold Drilling Ltd.
Bryce Porter – Director
Mr. Porter is a chartered accountant and graduate of the Harvard Business School management program. For 15 years, he was with Alcan Aluminum Limited, 5 years as CFO of Roan Consolidated Mines in Zambia then Vancouver as Vice President/CFO of three Amax subsidiaries including Canada Tungsten Mining Corporation Ltd. During the mid 1990′s, Mr. Porter was a director and CFO of Black Swan Gold Mines Ltd. and from 1998-99, worked refocusing the Company’s activities from gold into diamonds, following which he served as Chairman until 2001. He has been a director of Lysander Minerals Corporation since 1997. He has also served as Chairman of Beralt, Director of Primary Metals from 2003 to 2005 and as President of Primary Metals from 2003 to 2004.
Harold Schwenk – Chief Financial Officer
Mr. Schwenk has in excess of 17 years experience as a professional accountant and as a consultant for Price Waterhouse Coopers in the natural resource sector. His responsibilities have included the implementation of accounting and reporting functions for companies engaged in the mining industry including, North American Metals Corp., Miramar Mining corporation, Eldorado Gold Corporation and Hillsborough Resources Ltd.
