Second major Tungsten project outside of China faces delay

By Leia Michele Toovey- Exclusive to Tungsten Investing News

The past week has seen many new company developments when it comes to tungsten.

Vancouver-based Golden Predator Mines announced the intersection of near surface tungsten mineralization in drilling at its wholly-owned Springer tungsten project in Nevada. On the news of the resource discovery, shares jumped 13 per cent to 87 cents.  

Prior to this announcement, the company announced that it would have to undertake a series of cost cutting measures at the Springer Project as a direct result of the current global financial mess. Although the cost-savings programs will delay eventual startup of the Springer mill, all permitting activities and operational readiness programs will continue, which should better prepare the Company for the return of order to the markets.

The announcement that Golden Predator will delay the opening of the mine was a huge blow to non-Chinese tungsten consumers. China produces 90 per cent of the world’s tungsten, and regards it as a strategic metal. Fears are being expressed that the country could cut exports at any time, a step it has taken in the past.

In what is being interpreted as another blow to non-Chinese consumers, Advanced Material Japan Corp. issued a press release stating that it had suspended a proposal to reopen the Kiwada Tungsten Mine after a 16-year hiatus. This complicates the nation’s plan to reduce dependence on imports of the metal. The plan was halted because of environmental concern, a lack of miners and problems estimating deposits and acquiring the rights.

Like other countries across the world, Japan is dependent on primary producing China to supply the nation with its Tungsten needs. The metal tripled in price in 2004-05 as rising demand fuelled a boom in commodity prices.  China is known to cut off exports when their booming economy is in need of metals.  Given the recent growth of the region there are many fears that China will turn off the tap in the near future.

This week, Largo Resources (CA:lGO)  issued an update on their  Northern Dancer Project. The project is one of the world’s largest known tungsten-molybdenum porphyry systems, with mineralization  hosted in fractures and veins associated with a northeast-trending sheeted vein system in calc-silicate (skarn) rocks and spatially related to a felsic intrusion (quartz-feldspar porphyry). The deposit, which has been tested by drilling for 1500 meters along strike, 500 meters vertically and 600 meters in width, remains open along strike to both the northeast and southwest as well as at depth.

This past week, Largo announced the receipt of results of the five additional drill holes on the project. The 2008 drill program focused on upgrading and expanding the limits of the higher-grade tungsten and molybdenum zones outlined during the 2007 drill program. The second intention of the addition drilling was a further upgrade of the inferred and indicated resource to a measured and indicated category in order to support a pre-feasibility Study. Drill results continue to confirm the higher-grade tungsten and molybdenum zones. Currently, core logging and splitting is continuing and is expected to be completed before the end of September.

Historical work on the property was completed by AMAX Minerals Exploration from 1977 to 1980.  Largo completed a 17-hole diamond drill program in 2006 and 26-hole program in 2007. On April 10, 2008 Largo announced an updated NI 43-101 compliant resource consisting of indicated of 140.8 million tonnes grading 0.10 per cent WO3 and 0.026 per cent Mo and Inferred resources totaling 253.2 million tonnes grading 0.10 per cent WO3 and 0.022 per cent Mo.  In addition to this key property, Largo Resources has a large (60,000 hectare) land position and prospective gold exploration properties in Ecuador, and the advanced stage Maracas Vanadium-PGM deposit in Brazil.

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