Vancouver — Armed with $6.5 million in financing,
The company recently entered into agreements with two leading producers of tungsten products — Pennsylvania-based Osram Sylvania Products (a subsidiary of Siemens of Germany) and Stockholm-based Sandvik.
In addition to a $6.5-illion cash advance, the two tungsten consumers have agreed to buy, over three years, all of North American Tungsten’s concentrate production from CanTung. This output is estimated to be 900,000 tonnes.
The agreements provide a guaranteed floor price and a scaled discount from quoted tungsten commodity prices, and Sandvik and Osram are entitled to participate in the development of any of North American Tungsten’s other tungsten interests, such as the MacTung mine, 160 km north of CanTung.
“We are extremely pleased with these developments, as they confirm the company’s long-standing firm belief in the quality and potential of its assets,” says Udo von Doehren, president of North American Tungsten.
CanTung’s reserves are pegged at 630,000 tonnes grading 1.82% tungsten trioxide. MacTung is estimated to contain a measured, indicated and inferred resource of 30 million tonnes grading 0.93% tungsten trioxide. The current price of tungsten is in the range of US$70-75 tonnes, which is 300% higher than a year ago.
The CanTung mine is in the southwestern corner of the Northwest Territories, near the town of Tungsten. The deposit was discovered in 1958 by prospectors who identified scheelite mineralization hosted in a sulphide-bearing skarn.
Over the following three years, an extensive exploration program delineated an open-pit deposit with reserves of 1.3 million tonnes grading 2.5% tungsten trioxide and 0.5% copper. The mine was commissioned in 1962 and operated until 1986, when low tungsten prices resulted in a shutdown.
While operating, the mine produced high-grade scheelite concentrates in excess of 75% tungsten trioxide, as well as lower-grade concentrates averaging 35% tungsten trioxide. The product was shipped to markets in the U.S. and western Europe. North American Tungsten purchased the CanTung mine and the MacTung property from
The region is underlain by a series of late Proterozoic-to-Mississipian-aged sedimentary rocks of the Selwyn Basin. The rocks range from argillite, with minor carbonates, to dolomite and quartzite. The Tungsten area forms a northwest-trending synclinal structure that is intruded by Cretaceous-aged quartz monzonite to granodiorite plugs.
The CanTung scheelite deposits were formed by metasomatism within the thermal aureole of a granodiorite-quartz monzonite intrusion. The main tungsten mineralization is hosted in a limestone unit that is folded into a recumbent anticline. The open pit was on the upper limb of the fold, whereas the underground E-zone is on the lower limb of the fold, about 1000 ft. below the pit.
Scheelite is the only tungsten mineral identified at CanTung; it is associated with pyrrhotite and minor chalcopyrite. Most of the remaining resources are underground, in the West Extension zone.
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