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Tungsten

A supplement to Mining Journal

OVERVIEW CONTENTS

Overview Exploration Map Profiles: Amanta Resources Geodex Minerals Malaga North American Tungsten Oriental Resources Ormonde Mining Queensland Ores 2-4 5-6 8-9 7 10 11 12 13 14 15

Heavy stone

The name tungsten is taken from the Swedish for heavy stone (tung sten), but the element is also widely referred to as wolfram after one of its ores

Cover: montage of scheelite and tungsten images, with `w' the chemical symbol for wolfram

Photo: North American Tungsten

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Published in June 2008 by: Mining Communications Ltd Albert House, 1 Singer Street London EC2A 4BQ Tel: +44 (0)20 7216 6060 Fax: +44 (0)20 7216 6050 E-mail: [email protected] Website: www.mining-journal.com Supplement editor: Chris Hinde Design and production: Tim Peters, Karen Leverington,Vickie Johnstone Printed by Latimer Trend, Plymouth, UK © Mining Communications Ltd 2008

An Aspermont company

ITIA

The International Tungsten Industry Association was inaugurated in Brussels in February 1988, and is registered as an association with scientific purposes under Belgian law. The members of ITIA, from 17 countries, include mining companies, processors/consumers, trading companies and assayers. Website: www.itia.org.uk

lthough not isolated until 225 years ago, tungsten has a history dating back to before Georg Agricola, who is thought to have described the ore in 1546.Tin miners extracting cassiterite in the Erz Mountains of Saxony in the 17th century noted that certain ores reduced the amount of tin recovered "like a wolf devours a sheep" (the effect of the ore being likened to wolf's froth, volf rahm in German). In 1758, the Swedish chemist and mineralogist, Axel Fredrik Cronstedt, discovered and described an unusually heavy mineral that he called `tung sten'. Although he was convinced that this mineral contained a new and as yet undiscovered element, it was not until 1781 that a fellow Swede, Carl Wilhelm Scheele (who worked as a pharmacist and private tutor in Uppsala and Köping) succeeded in isolating the oxide (tungsten trioxide). Torbern Bergman, working at Uppsala, predicted that the acid isolated by Mr Scheele contained a new metal, which should be possible to prepare by coal reduction. One year later, a Spanish nobleman, Don Juan José de Elhuyar, studied at the University of Uppsala under Bergman. Back in Spain in 1783, Juan José and his brother, Fausto de Elhuyar de Suvisa, were the first to prepare tungsten metal by the method suggested by Bergman. They named it wolfram. Jöns Jacob Berzelius (1816), and later Friedrich Wöhler (1824), described the oxides and bronzes of tungsten, and also proposed the name wolfram. In 1821, KC von Leonhard proposed the name scheelite for the mineral CaWO4. In 1847, R Oxland took out a patent for the manufacture of sodium tungstate and tungstic acid. This forms the starting point of the metallurgy of tungsten.

CONVERSION

Tungsten conversion measurements W 1.2616 WO3 Ton 2,000lb Ton 0.907t Tonne 2,204.6lb Tonne 100MTU (metric tonne units) Short ton unit 20lb (1% short ton) MTU 1.1023STU MTU 10kg (1% metric tonne) MTU 22.04lb

scheelite concentrate

wolframite concentrate

Industry schematic

secondary tungsten (concentrates) 34%

The first attempts to produce tungsten steel were made in 1855 by J Jacob and F Koeller at the Reichraming steel works in Austria. Further improvements in alloying and hardening of steels by tungsten were made late in the 19th century, and rapid growth and widespread application followed. The launch of high-speed steels by Bethlehem Steel took place in 1900 at the World Exhibition in Paris. The second important breakthrough in tungsten applications was made by WD Coolidge in 1908 and 1909. Mr Coolidge succeeded in preparing a ductile tungsten wire by thermo-mechanical processing. Metal powder (WC) was pressed to bars, sintered and forged to thin rods.Very thin wire was then drawn from these rods. This was the beginning of tungsten-powder metallurgy, which was instrumental in the rapid development of the lamp industry. The next important milestone in the chronology of tungsten is 1923, which marks the invention of hard-metal (combining WC and cobalt by liquid-phase sintering) by K Schröter. The corresponding application for a patent was granted to Osram Studiengesellschaft in Berlin, and licensed to Krupp in Essen in 1926. Hard-metal (cemented carbide) is now the main application for tungsten.

primary tungsten (concentrates) 66%

HISTORY LESSON

The brothers José and Fausto Elhuyar are credited with the discovery of the element in Spain during 1783. They had found an acid made from wolframite that was identical to an acid made from scheelite (tungstic acid), and subsequently succeeded in isolating tungsten through reduction of this acid with charcoal. Carl Wilhelm Scheele had ascertained two years earlier that a new acid (at the time named tungstenite) could be made from scheelite. Mr Scheele and Torbern Bergman suggested that it could be possible to obtain a new metal by reducing this acid.

TOTAL TUNGSTEN DEMAND

nal product 90% loss through dissipation & discard 55% scrap from processing 10%

scrap from used parts 24%

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June 2008 Mining Journal special publication Tungsten

OVERVIEW

European free market prices (US dollars per MTU)

300 250

US$

200 150 100 50

Source: Metal Bulletin

UNIQUE PROPERTIES

Tungsten (given the chemical symbol W, from wolfram) has an atomic number of 74, and is an extremely hard, and very dense, grey to white metallic element. Of the metals, it has the highest melting point (3,422°C, which is second only to carbon among all elements), the lowest coefficient of expansion, the highest tensile strength (at temperatures above 1,650°C) and the lowest vapour pressure. It is also corrosion resistant and does not break down or decompose. Due to these unique attributes, tungsten has few replacements in a majority of its industrial applications. Although tungsten is often brittle and hard to work in its raw state, it can be cut with a hacksaw in its pure state. The pure form of tungsten is used mainly in electrical applications, but its many compounds and alloys are used in a wide range of applications. For example, because of its ability to produce hardness at high temperatures and its high melting point, tungsten is used in many high-temperature applications. These include light bulb, cathode-ray tube and vacuum tube filaments, as well as heating elements and nozzles on rocket engines.

The high melting point also makes tungsten suitable for aerospace and high temperature uses, including electrical, heating and welding applications, notably in the gas-tungsten arc-welding process (also called TIG welding). It is also used in electrodes, and in the emitter tips of field emission electron-beam instruments, such as focused ion beam (FIB) and electron microscopes. The metal is also used in X-ray targets. Tungsten chemical compounds are used in catalysts, inorganic pigments and tungsten disulphide high-temperature lubricants which are stable to 500°C. Tungsten carbide (W2C or WC) is produced by heating powdered tungsten with carbon, and is one of the hardest carbides (with a melting point of 2,770°C for WC, and 2,780°C for W2C). WC is an efficient electrical conductor (W2C less so) and tungsten carbide behaves in a manner very similar to that of unalloyed tungsten and is resistant to chemical attack, although it reacts strongly with chlorine to form tungsten hexachloride (WCl6). Tungsten carbide is used to make wear-resistant abrasives and cutters and knives for drills, circular saws, milling and turning tools. In these applications, tungsten carbide may be combined with cobalt, or coated with titanium nitride or titanium carbide. Because of the hardness and density of the element, tungsten finds use in heavy metal alloys that are used in armament, heat sinks and high-density applications, such as weights, counterweights, ballast keels for yachts, tail ballast for commercial aircraft and ballast in racing cars (including NASCAR and Formula 1). In armaments, tungsten (usually alloyed with nickel and iron or cobalt to form heavy alloys) is used in kinetic energy penetrators as an alternative to depleted uranium. Tungsten may be used in cannon shells, grenades and missiles to create supersonic shrapnel. Darts may

A 1mm tungsten bead helps this fishing fly sink more quickly contain a high proportion of tungsten, allowing their diameter to be smaller than those made of other metals, and permitting tighter groupings. Fishing lures and many fishing flies use tungsten bead heads to sink the fly rapidly. Some types of strings for musical instruments are wound with tungsten wire. Tungsten, which has a similar density to gold, is sometimes used in jewellery as an alternative to gold or platinum (its hardness makes it ideal for rings that will resist scratching, are hypoallergenic and will not need polishing). This property is especially useful in designs with a brushed finish. In metal alloys, high-speed steel contains tungsten (some tungsten steels contain as much as 18% W). Superalloys containing tungsten are used in turbine blades and wear-resistant parts and coatings. Tungsten powder is used as a filler material in plastic composites, which are used as a non-toxic substitute for lead in bullets, shot and radiation shields. Since the element's thermal expansion is similar to borosilicate glass, it can also be used for making glass-to-metal seals. In electronics, tungsten is used as an interconnect material in integrated circuits. The oxides are used in ceramic glazes, and calcium/ magnesium tungstates are used widely in fluorescent lighting. Crystal tungstates are used as scintillation detectors in nuclear physics and nuclear medicine. Other salts that contain tungsten are used in the chemical and tanning industries. Tungsten `bronzes' (so-called due to the colour of the tungsten oxides) are used in paints. Presentation of WIDIA (hard-metal) at the 1927 Leipzig fair by Friedrich Krupp AG. A new material was born which revolutionised the tool industry. (This picture, published in 1944 in Engineering & Mining Journal, illustrates the many applications of tungsten at that time.)

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PROPERTY SUMMARY

Hardness: Second only to diamond, and tungsten carbide is used in a range of industrial applications, including high-speed cutting, heavy machinery and specialty alloys. Heat resistance: Highest melting point and lowest coefficient of expansion of all metals. Industrial applications include jet turbine engines and light-bulb filaments. Density: Greater than lead and uranium, and industrial applications include ballast and sporting goods (golf clubs, tennis racquets and darts). Benign: Tungsten does not break down or decompose. Its industrial applications include fishing weights and shotgun shot. Fluorescence: Pure scheelite is blue-white in ultraviolet light, a property that is utilised in prospecting.

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June 2008 Mining Journal special publication Tungsten

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OVERVIEW WANTED

Tungsten was an important metal during the Second World War (as a raw material for the weaponry industry) and, as the main European source of the element, Portugal was put under political pressure from both sides.

The Tungsten Tree, published in 1944 by Wah Chang

Steel branch Compounds

DEPOSITS

All tungsten deposits are of magmatic or hydrothermal origin. Although more than 30 tungsten-bearing minerals are known, only two of them are important for extraction: wolframite (Fe, MnWO4) and scheelite (CaWO4). The concentration of these minerals in workable ores is usually 0.3-1% WO3. Wolframite is a general term for iron and manganese tungstates where the iron/manganese ratio can vary. A mineral with more than 80% FeWO4 is called Ferberite and a mineral with more than 80% MnWO4 is called Hübnerite. During cooling of the magma, differential crystallisation occurs, and scheelite and wolframite are often found in veins where the magma has penetrated cracks in the earth's crust. Most of the tungsten deposits are in younger mountain belts, for example the Alps, Himalayas and the Pacific rim. World tungsten resources have been estimated at 7Mt W, including deposits that have so far not been proven to be economically workable. It is suggested that 30% of the resources are wolframite and 70% are scheelite ores. The former mineral contains 76.5% WO3, while the latter contains 80.5% WO3. There are major deposits of these minerals in China (with about 57% of the world total), Russia, Austria and Portugal.

Carbide branch Non-ferrous alloys

tungsten-metal powder in either `pusher' Tungsten ore furnaces (in which the powder passes through the furnace in boats) or in `rotary' furnaces, at 700-1,000°C. Most of the tungsten-metal powder is converted to tungsten carbide (WC) by reaction with pure carbon powder (eg carbon black) at 900-2,200°C in pusher or batch furnaces, a process called carburisation. Tungsten carbide is, quantitatively, the most important tungsten compound. Because of its hardness, it is the main constituent in cemented carbide. Scrap recycling is an important factor in the world's

PRODUCTION

China is today by far the largest supplier of primary tungsten. The other principal producing countries are Austria, Bolivia, Canada, Portugal and Thailand. Mines have closed in recent decades in Australia, Brazil, France, Japan, South Korea, Sweden and the US. The extraction of tungsten has several stages, the ore being converted to tungsten oxide (WO2), which is heated with hydrogen or carbon, producing powdered tungsten. It can be used in that state or converted into solid bars. Ammonium Paratungstate (APT) is usually calcined to yellow (WO3) or blue oxide (WO3-X, a slightly substoichimetric trioxide with varying oxygen content). The yellow or blue oxide can be reduced to

tungsten supply. It is estimated that some 30% is recycled, and the tungsten-processing industry is able to treat almost every kind of tungsten-containing scrap and waste to recover tungsten. Sources: North American Tungsten Corp, ITIA

Estimated world tungsten reserves 7Mt (W content)

CIS Other 17% South 4% America Canada 6% China

Supply in 2004: 56,700t (W content)

Other 11%

57%

6%

CIS China

APT

Ammonium Paratungstate is the main intermediate product and the main tungsten raw material traded in the market. (NH4)10(H2W12O42).4H2O

83%

12% 4% US

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June 2008 Mining Journal special publication Tungsten

EXPLORATION

Activity report

Exploration and development of tungsten projects is taking place around the world

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AST month, Geodex Minerals Ltd upgraded the resource estimate at its Sisson Brook bulk-tonnage tungstenmolybdenum-copper deposit in western New Brunswick, Canada. The firm's recent exploration efforts in the area have been divided between Sisson Brook and a more polymetallic group of targets surrounding the former Mount Pleasant mine. Measured and indicated resources at Sisson Brook now consist of 328Mlb tungsten and 108Mlb molybdenum at 0.025% W03 equivalent. Geodex is working towards the completion of a pre-feasibility study in September using these new resource numbers. In May, Ormonde Mining plc announced that it was focusing on bringing the Barruecopardo tungsten project in Spain into production as soon as possible, while it works on reducing costs at the Zarza polymetallic project, also in Spain. Initial studies at the Barruecopardo mine indicate the potential to revive operations with an underground project from the existing open pit. Inferred resources are estimated at 1.0Mt at an average grade of 0.7% WO3, and the study outlined a project producing 900t/y of tungsten at a capital cost of 10-15 million. The company hopes to complete evaluation of Barruecopardo by the end of this year and begin production in the second half of 2009. Also in May, AIM-listed Polo Resources Ltd announced that it was "chasing" GCM Resources plc with an offer valued at £60 million (US$118 million). Polo, which currently holds 29.7% of GCM, said the offer is "consistent with Polo's strategy of building a significant and diversified portfolio". The company's main assets are coal, tungsten and uranium holdings in Mongolia. Queensland Ores Ltd (QOL) owns 85% of Wolfram Camp, Australia's most historic producer of significant quantities of tungsten, molybdenum and bismuth. The mine is due to commence concentrate shipments in July, marking Australia's return as a producer of tungsten concentrate. QOL listed on the Australian Stock Exchange in 2005, and redevelopment and construction work at Wolfram Camp began in November 2007. With an orefeed rate of 150,000t/y, QOL is expected to produce an annual average of 600t WO3 in a 65% wolframite concentrate, and 250,000lb Mo in a 50% molybdenum concentrate. In May, QOL announced a A$12 million capital raising that would leave the company debt free and with additional exploration funds to conduct near-mine definition drilling to increase the size of the current Wolfram Camp resource. In March, Oriental Minerals Inc upgraded its resource estimate for the Sangdong historical tungsten-molybdenum mine in South Korea. The firm had already released a resource estimate by consultant Wardrop Engineering, but the update includes further drilling results and a different cut-off grade. The previous cut-off grade was 0.15% WO3, but for the latest estimate it is 0.10% WO3-equivalent. Oriental Minerals said this cut-off grade represented a

North American Tungsten's Century mine in Canada

Clockwise from top left: Vital Metals; Tyhee Development Corp's Giant mine; Paradigm's White Rock project; Amanta's Doi Ngom mine recoverable grade, with recoveries of 70% for tungsten and 80% for molybdenum. Sangdong, about 170km southeast of Seoul, was mined by underground means from 1940-92 at annual rates of up to 600,000t of ore, and Oriental is investigating the potential for an open-pit operation to exploit the remaining resources. The estimate included drilling results from 42 holes completed by Oriental, plus 780 underground holes by previous operators. Wardrop is preparing a preliminary economic assessment of the development of an open-pit operation at Sangdong, which is due for completion in the September quarter. At the time of the original resource estimate, chief executive Willie McLucas said: "This first report illustrates the long-term potential of Sangdong as one of the largest known tungsten deposits in the world." Oriental also noted that the drilling results contained "notable base-metal grades" in the limestone sequence overlying the west part of the Sangdong deposit. Wolf Minerals Ltd announced a maiden JORC resource estimate in March for its Hemerdon Ball tungsten-tin deposit in Devon, UK. The Perth-based firm reported that SRK Consulting had estimated inferred resources of 82Mt at 0.22% WO3 and 0.02% Sn (at a

June 2008 Mining Journal special publication Tungsten

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EXPLORATION

0.12% W cut off). In 1981, Amax had outlined reserves of 0.183% WO3. The latest resource calculation was based on the relogging of core and re-assaying samples from 2,688m of drilling (303 holes were drilled, totalling 21,846m). The mineralisation is hosted by sheeted greisen veins and stockworks in fresh and weathered granites, and surrounding killas (shale) units. At the end of last year, Wolf announced that it hoped to bring the historical mine back into production, saying the project would "form an excellent platform for the company to become a major tungsten and tin producer". Wolf acquired the property at a cost of A$1 million and will pay an annual rent of A$145,000 as well as a net smelter royalty of 2%. Wolf expects mining to begin at the site in three years' time, although the local authorities will undertake a full review of the project to reassess its environmental standards. The relevant planning permissions were passed in 1986 and are still valid, but will be revised "in line with modern mining practices". The mine, once operational, is expected to produce 3,000t/y of tungsten over a mine life of 15-19 years. Thor Mining plc entered into an off-take agreement in March with CITIC Group for its Molyhil tungsten-molybdenum project in Australia's Northern Territory. Under the terms of the deal, CITIC will take 100% of the life-of-mine production from Molyhil. Thor said the agreement allowed the company to move forward with finalising funding for the project, for which final development deals are expected in the current quarter.

Operations of North American Tungsten Corporation (above) and Geodex (right) costs for the new project were estimated at A$78/t, compared with the previous A$94/t. Amanta Resources Ltd is focused on southeast Asia, and the Canadian company's assets include three former tungsten mines near Chiang Mai in northern Thailand. It is now over a year since the military coup in Thailand, which was the world's fourth-largest producer of tungsten prior to the collapse of the tungsten market in the early 1980s (with output peaking at 7,500t/y). Current production is barely 100t/y, but Amanta is convinced of the country's potential. Drilling on the Mae Lama property has shown "significant mineralisation" to a depth of over 200m, according to the company, with a strike length of over 700m at a typical width of 1.5m. Malaga Inc has discovered new mineralisation at its Pasto Bueno tungsten mine in northern Peru. The mine is the only operating tungsten mine in South America and the second largest in the Americas. Two mineralised vein structures have been identified; one on either side of the Consuelo vein that is currently being mined. The new veins have been called Sauco (on the west side) and Paraiso (east side). Near-term exploration will focus on the Santa Marta vein, said the company earlier this year. In February, Largo Resources Ltd reported wide zones of tungsten and molybdenum mineralisation from ten drill holes, totalling 1,875 samples, at its Northern Dancer tungsten-molybdenum project in the Yukon. Drilling is focused on upgrading and expanding the resource of 242Mt grading 0.10% WO3, 0.047% MoS2, including 36.8Mt grading 0.085% MoS2. In August 2007, Tyhee Development Corp announced additional gold and tungsten results from the Nicholas Lake main zone at its 100%-owned Yellowknife gold project in Canada. Tyhee had resampled all previously completed drill holes from the Nicholas project to assess the potential for a bulk-mineable resource. The flagship project for Vital Metals Ltd is the Watershed scheelite deposit in north Queensland, 150km northwest of Cairns. The project is at the pre-feasibility stage, with a programme of in-fill drilling, bulk sampling and metallurgical development in progress. A resource estimate by RSG Global Pty for Watershed indicated 21.8Mt at an average grade of 0.26% WO3 (based on a cut-off grade of 0.1% WO3) for a contained WO3 content of 56,300t. The mineralisation at Watershed is open at depth and along strike in both directions.

Galway Resources at work

In November 2007, Thor confirmed plans to increase the planned scope of Molyhil, but admitted that the new project would cost more. The review confirmed a new reserve estimate (Thor had published the new JORC-compliant resource of 3.7Mt in September 2007) and increased the scale of the project from a throughput of 300,000t/y to 400,000t/y over a five-year period. But, estimated capital costs were increased from the A$45.5 million outlined in a feasibility study at the end of 2006 to A$63.3 million. Thor noted that the higher capital costs include the outright purchase of mining equipment and power-generation plant, and the purchase of the processing plant and equipment, and village and infrastructure, rather than contracted services used for the previous estimate. As a result, cash operating

The company announced a year ago that it was also drilling a target to the south of the main deposit which identified four potential new zones of scheelite mineralisation that could extend the limits of the resource by 200m. In addition to Watershed, Vital Metals has the rights to two other tungsten occurrences at advanced stages of exploration: Mt Alexander (100%-owned) and Mt Mulgine (where Vital Metals is earning a 70% stake). Also in Australia, Paradigm Gold Ltd owns the White Rock tungsten and tin project in Orange, New South Wales. The company announced assay results one year ago, confirming a tin-rich halo surrounding tungsten mineralisation at the project. At that time Paradigm reported an estimated indicated and inferred resource of 150,000t at an average grade of 0.9% WO3, based on historical drill results. The wholly-owned Mactung deposit of North American Tungsten Corporation was confirmed in March 2007 as the largest, undeveloped, high-grade, tungsten skarn deposit in the world. The deposit lies on the border between the Yukon and Northwest Territories in Canada. A NI 43-101compliant evaluation by Scott Wilson Roscoe Postle Associates had given an indicated resource of 33.0Mt at an average grade of 0.88% WO3, and an inferred resource of 11.3Mt at 0.78% WO3. These figures included 22.2Mt and 4.6Mt, respectively, of ore with average grades of over 1% WO3. Based on these figures, which used data from 168 drill holes and a cut-off of 0.5% WO3, the deposit contained a combined 38.2Mmtu WO3. North American Tungsten Corporation is already in production at the Cantung mine in Canada's Northwest Territories. The firm is expanding a newly discovered zone down-dip of the West Extension workings, where additional high-grade intersections were announced earlier this month. Galway Resources Ltd filed a NI 43-101 report by SRK Consulting one year ago for its Victorio molybdenum-tungsten project near Deming, New Mexico. Based on data from 71 holes (some 50,000m of drilling), the deposit contains over 65Mlb of molybdenum and 57Mlb of WO3 in the indicated category, and 31Mlb molybdenum and 33Mlb WO3 in the inferred category. The cut-off grade was based on molybdenum valued at US$12/lb, combined with tungsten (WO3) valued at US$8/lb (yielding a rock value cut-off of US$40/t).

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June 2008 Mining Journal special publication Tungsten

PROFILE

Amanta revives Thai tungsten

Massive wolframite crystals in Mae Lama production vein

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MANTA Resources, a publicly-traded Canadian company, focuses on the acquisition and development of strategic minerals in southeast Asia. Amanta selects known, high-quality mineral deposits with recognised potential as successful producers. Prior to the collapse of the tungsten market in the early 1980s, Thailand was the world's fourth-largest producer of the metal with peak production of 7,500t/y. Today, the country produces about 100t/y. Thailand's rich potential is directly linked to the widespread occurrence of granitic intrusives of the southeast Asian tin-tungsten belt. In the 1970s and early 1980s tungsten concentrate was produced from a large number of small mines and a few larger ones. Recognising Thailand's potential for tungsten production, Amanta acquired a 100% working interest in three former tungsten mines near Chiang Mai in northern Thailand. The company's tungsten prospects at Mae Lama, Mae Chedi and Doi Ngom were among the larger producers of the 1980s, each outputting several hundred tonnes of concentrate per year, with peak production at Doi Ngom surpassing 1,000t/y.

Drilling at Mae Lama, December 2007 (above); massive wolframite crystals in Mae Lama drill core and grab sample (below) Mae Lama is a simple, wolframite-in-greisen-quartzvein deposit. The principal tungsten mineral is wolframite with associated minor scheelite. One main vein and dozens of minor ones are known in the licence area, many of which are mineralised, and the reported head grade for previous mining operations was 2% WO3. Drilling has demonstrated that the Mae Lama vein contains significant tungsten mineralisation to a depth of over 200m, and traced it along the trend for 700m at a typical width of up to 1.5m. During the exploration programme, the company uncovered a number of old adits from the former mining operations at Mae Lama, which provide direct access to the two significant, mineralised vein systems found on the property. Amanta geologists have observed high-grade mineralisation in situ. Based on these observations, photographic evidence and observed wolframite crystals in drill cores, the Mae Lama tungsten deposits are now considered to be classic, high-grade, narrow vein deposits. The firm is rehabilitating the former production openings to take channel and bulk samples from the production vein. Amanta plans an early resumption of tungsten production, with the objective of developing up to one million tonnes of ore and verifying the reported production grade of 2% WO3. Production at the mine could resume as early as mid-2009. Assuming grade and tonnage are verified, Amanta anticipates a production level of up to 2,500t/y of high-grade tungsten concentrate, providing the company with a significant revenue stream for up to ten years. Producing a concentrate rather than a finished product will ensure that both capital and ongoing production costs are minimised. between these and carboniferous mafic intrusives. Disseminated mineralisation occurs as fine patches of scheelite-cassiterite in the granite, and as veins and veinlets up to 1m thick in the contact zone. A reconnaissance programme has yielded grab samples of up to 7% WO3. At Doi Ngom, southeast of Chiang Mai, tungsten ore is confined to silicified breccia zones in Permian metasediment. The main tungsten mineral is ferberite, occurring as breccia fill and cement, and in fractures and veinlets. Ferberite is associated with fluorite and stibnite. Shallow reconnaissance drilling has yielded tungsten grades of up to 1.8% WO3 over a 1m intercept in one drill hole plus a number of lowergrade intersections of up to 10m in other holes.

MAE LAMA TUNGSTEN PROJECT

Of the three prospects, the Mae Lama property, southwest of Chiang Mai, offers the most immediate opportunity for fast-tracking into production.

OTHER PROJECTS

Over the past four years, Amanta Resources has pursued an active exploration programme at its Langu gold project in southern Thailand, including 4,500m of reconnaissance drilling, with results of 1.4g/t Au to 3g/t Au. Amanta plans to drill an additional 25,000m and has commenced negotiations with a potential joint-venture partner. Amanta Resources recently received a 200km2 copper-exploration concession from the Lao People's Democratic Republic. Amanta will hold a 100% working interest in the Luang Namtha copper project, located in Luang Namtha province.

PEOPLE

Amanta Resources has a versatile, international

team of engineers and geologists from Canada, the Netherlands, Thailand,Vietnam and the Philippines.

President and CEO Dr Gerald Wright

is co-founder of the Crew group of companies. As former CEO of Asia Pacific Resources, he was responsible for developing that company's major potash project in Thailand. Dr Wright holds a BSc and a PhD (engineering) from Queens University, Belfast, Northern Ireland, and he has been a PEng in British Columbia since 1980.

CONTACTS

Amanta Resources Ltd 1080-789 West Pender Street, Vancouver, BC, Canada V6C 1H2 Tel: +1 604-730-9505 Fax: +1 604-648-8096 Email: [email protected] Web: www.amantaresources.com Exchange: TSXV Symbol: AMH

Executive vice-president and chief

geologist Pieter Bakker holds an MSc in mining and geology from the University of Delft, Netherlands. He is a member of the Australian Institute of Mining and Metallurgy and is a chartered geologist in Thailand. He has also held the posts of chief, mineral resources section, United Nations ESCAP, Bangkok, executive viceESCAP president, Indochina Goldfields, and senior vicepresident and director of Bong Mieu Holdings.

OTHER TUNGSTEN PROJECTS

The Mae Chedi property is located northeast of Chiang Mai. Tungsten ore (scheelite), associated with tin (cassiterite), occurs in quartz veins and stockworks in granitic rocks, and also in the contact zone

June 2008 Mining Journal special publication Tungsten

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GEOLOGICAL MAP

Tungsten projects reported to global financial markets as of June 2008

Number of Projects

71 - 75 21 - 70 11 - 20 2 - 10 1 Nil (1) (1) (2) (8) (12)

This map has been complied in good faith by intierra from internal and external published sources, but no representation is made nor warranty given (either express or implied) as to the completeness or accuracy of the materials that it contains. For continuously updated, more detailed information go to www.intierra.com. Intierra's copyright remains on all reproduction of materials from the map. Copyright Intierra Ltd 2008

Map depicts the number of tungsten projects reported to the North American, Australian, South African and London markets as of June 2008. Projects range from grass-roots exploration plays through to operating mines.

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June 2008 Mining Journal special publication Tungsten

GEOLOGICAL MAP

COUNTRY Canada Australia United States Mexico Thailand Portugal Spain Vietnam Brazil China Mongolia Peru

TOTAL 74 63 18 15 7 3 3 3 2 2 2 2

Bolivia Indonesia Kyrgyzstan Namibia New Zealand Poland Russia Serbia Slovakia South Korea Tanzania United Kingdom

1 1 1 1 1 1 1 1 1 1 1 1

Note: China is the world's largest producer of tungsten, followed by Russia.

June 2008 Mining Journal special publication Tungsten

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PROFILE

Geodex Minerals aims to turn up tungsten at Sisson Brook project

G

EODEX Minerals Ltd has focused on the tungsten-molybdenum-zinc-indium suite of metals in western New Brunswick, Canada, for the past three years, almost alone in that regard. Work has been divided between Sisson Brook, a bulk-tonnage tungsten-molybdenum-copper deposit, and a more polymetallic group of targets surrounding the former Mount Pleasant mine. The company's management consists of a knowledgeable team of geologists with extensive experience of mine development from working with such companies as Kennecott, Kamad Silver, Esso Minerals and Teck Corp. The company's flagship project, Sisson Brook, is a large, open-pittable deposit, located in the central part of the New Brunswick. The deposit was drilled by Kidd Creek from 1978-82, but the discovery was abandoned due to severe metal price setbacks in the mid-1980s. The deposit has been expanded by Geodex since 2005. The mineralised area extends for over 2km, encompassing at this point two northern zones with tungsten and copper, and a central, more significant zone of tungsten and molybdenum of over 300m wide. This Zone III has been the subject of three resource estimates and a preliminary, economic evaluation by Wardrop Engineering in November 2007. The most recent NI 43-101-compliant resource estimate (in June) upgraded Sisson Brook's resources to measured and indicated status. The overall tonnage increase ranged from 37% at the lowest threshold level (0.025% WO3 equivalent) to 134% at the highest (0.225% WO3). The measured and indicated resources now consist of 328Mlb tungsten and 108Mlb molybdenum at 0.025% WO3 equivalent. The company is working towards completion of a pre-feasibility study in September using these new resource numbers. The project is currently on track to become the lowest-cost tungsten mine in North America. The deposit will have the benefit of low-cost, open-pit mining in an easily accessible area and a willing labour force. Concentrate will be trucked to the port of Saint John, about two hours away on the Bay of Fundy coast. The largest mine in the nearby Bathurst mining district is due to close in mid-2010 after a 60-year life. This may have a positive impact on the supply of equipment and labour for the Sisson Brook, and encourage the New Brunswick government to fast-track its development.

Sisson Brook has the advantage of unsurpassed logistics: it lies on crown land, which is a major advantage for resource development; the area has been partially logged; there is ready access from a network of logging roads; a power line crosses the property, and it is located close to several small towns, which are serviced by a rail line and provincial highway 107. Construction and production would create many needed employment opportunities in New Brunswick. The company estimates about 750 jobs for local people during construction and 300 during full operation of the mine, ranging from trucking to office administration. Three drills are presently on the property exploring extensions to various zones. Earlier this year, Geodex began metallurgical, geotechnical and environmental programmes to fast-track the deposit into production. Wardrop Engineering will be carrying out mine design and grade-optimisation studies over the course of the next few months on the project. In addition, the firm will also be aggressively exploring seven other properties in the area of the Sisson Brook mine site. Geodex's second major project is Mount Pleasant West, a large property located adjacent to the Mount Pleasant mine, south of Fredericton in New Brunswick. This mine, presently owned by Adex Mining Inc, was operated briefly by Billiton in the mid-1980s, and it contains deposits of molybdenum-tungsten and tin-indium. Geodex's focus is on the indium potential in the Mount Pleasant West camp and the company's land holdings cover what is probably the world's largest area of premium indium-exploration targets. Geodex is about to conduct a major exploration drill programme at Mount Pleasant West.

diamonds. It is very inert and replaces lead in uses where it is exposed to the environment (tungsten recently started replacing lead in bullets). Currently, tungsten output is all but monopolised by China, which produces about 85% of the world's supply (and further tariff and quota increases are anticipated to keep the scarce supply within China). Meanwhile, the country has increased its domestic demand for tungsten products, and it is now importing both scrap and concentrate. The price of tungsten is US$220-250/mtu for APT (ammonium paratungstate), a refined form in which the metal is usually bought and sold. Over the next five years it is forecast that global prices for APT will increase by 25% from its current level. Current global consumption of tungsten is 81,200t/y (including 59,800t of new primary production). Over the next five years the consumption of tungsten is projected to rise to 109,328t, requiring almost 82,000t of primary output and an increase of 22,000t in new production. No new, major tungsten production has occurred outside China recently and is not expected until late

2009. Barriers include the cost of mine development and the limited availability of high-grade deposits. With the high-grade tonnage at Sisson Brook recently increasing, there is further potential to increase output at Sisson Brook and decrease the payback period. Slated for construction in 2010 and production in 2011, the Sisson Brook project will account for 5% of the world's current consumption of tungsten.

CONTACTS

Geodex Minerals Suite 450-800 West Pender Street Vancouver, BC, Canada V6C 2V6 Tel: +1 604 689 7771 Fax: +1 604 689 5528 E-mail: [email protected]

TUNGSTEN

Approximately three-quarters of the in-ground resources at Sisson Brook are tungsten; a metal mainly used in light filaments and metal-cutting tools. Tungsten has a density greater than that of lead and uranium, and its hardness is exceeded only by

10

June 2008 Mining Journal special publication Tungsten

PROFILE

Malaga rejuvenates Pasto Bueno

HISTORY (1910-2002)

1910s 1920s-40s 1940 1980-83 1984-93 1994 1995 1998 1998 Surface outcropping WO3 discovered Informal small-scale mining Industrial mining begins Peak production years 70,000MTU/y Production falls; no new investments Avocet buys controlling interest from Santolalla family Avocet invests US$1 million to increase production WO3 concentrate production of 25,100MTU Avocet sells 80% interest back to Santolalla family Production drops to 5,000MTU/y by 2002 Mine closes and declares bankruptcy; price of WO3 concentrate is US$45/MTU

P

1999-02 2002

ASTO Bueno is the only operating tungsten mine in South America and the second-largest in the Americas. Since the 1920s, more than 6Mt of tungsten ore has been extracted from the mine. In 2005, Malaga purchased 100% of Pasto Bueno from its former owners for US$3.25 million and reopened it the following year. Commercial production began in 2007, and 57,336MTU of tungsten concentrate was produced at a cost of about US$120/MTU. Malaga's management team has modernised the plant and mine, and are continuously seeking new ways to optimise its operation. The company has identified three main areas where significant progress could be made to dramatically lower production costs.

2007 HIGHLIGHTS

Commercial production began at Pasto Bueno

in April

Sales of WO3 concentrate (MTUs):

Q1 12,005 Q2 15,745 Q3 14,704 Q4 14,882 Total 57,336 Maximum milling capacity of 250tons/d reached in June Average year-round ore-grade milled 1%; recovery rate 82% Concentrate contains 75.46% WO3 and low impurities (Malaga-grade concentrate) development programme, involving the excavation of new galleries and inclined shafts, to gain access to new, higher-grade zones for mining.

ENERGY COSTS

Energy requirements at the Pasto Bueno mine are met by diesel-powered generating units. Malaga has invested in a hydroelectric power-generation project at Pasto Bueno, which should be able to supply all the company's energy needs by the end of 2008. The scheme includes a 1.9MW hydroelectric power plant, equipped with two Pelton turbines and alternators, operating under a 170m waterhead and a 22.9kV high-voltage transmission line. The company will be able to reduce its carbon emissions dramatically and save more than US$800,000 per year. The hydroelectric scheme is being built by Hidropesac SA, a subsidiary of Malaga Inc, in partnership with Electrokraft SA, a Peruvian energy company, and Emerging Power Developers SA, a Swiss hydroelectric company.

HIGHER ORE GRADES

Tungsten mineralisation at the Pasto Bueno mine is present in veins, stockwerks, lenses, etc. It is highly variable ­ a recent series of 57 samples taken from three tungsten-bearing veins (Consuelo, Alonso and Maria Luisa) had grades ranging from 0.45% to 8.02% WO3. Over the past 18 months, Malaga has found more than 40 new veins, of which 25 are major structures. Based on the initial results of an ongoing, US$2 million drilling campaign that began in 2007, Malaga has initiated an underground resource

INCREASED CAPACITY

The company plans to increase its production capacity from the current maximum of 250t/d to 500t/d by mid-2009. Based on the current operating environment, increasing production capacity to 500t/d would lower the unit production cost significantly. Finally, the results of the drilling campaign and undergrounddevelopment programme will enable Malaga to define new tungsten reserves, based on which it intends to build a new plant with a much higher milling capacity.

CONTACTS

Malaga Inc Canada: 2000 McGill College, Suite 510, Montreal, Quebec H3A 3H3 Tel: +1 514 288 3224 Fax: +1 514 288 8179 Email: [email protected] Peru: Calle Luis Pasteur 1297, Lince, Lima Tel: +51 1 440 1728 Fax: +51 1 421 3643 Website: www.malaga.ca

A NEW BEGINNING

2005 2006 2007 March November December January February Price of WO3 concentrate reaches US$180-200/MTU Dynacor Mines (Malaga) buys 100% of the Pasto Bueno mine Malaga invests US$7.5 million to restart the mine and plant Malaga signs three-year off-take agreement with Osram Sylvania Malaga announces US$2 million exploration and drilling campaign at Pasto Bueno Malaga discovers new WO3 mineralised zones Phase 1 of hydroelectric project completed Phase 2 of hydroelectric power-generation project initiated Malaga announces discovery of new WO3 mineralised structures and veins Malaga starts underground resource-development programme

2008

June 2008 Mining Journal special publication Tungsten

11

PROFILE

North American Tungsten's three pillars of strength

MACTUNG

THIRD PILLAR ­ TUNDRA

The third pillar of NTC is one that makes the company vertically integrated in the tungsten marketplace. The Tundra joint-venture pilot plant, located near Minnesota's White Bear Lake, started test production in late 2006 and has yielded ammonium paratungstate (APT) of the highest grade and purity (wire grade 99.9%). The transaction to Buffalo Tungsten, a major supplier of tungsten and tungsten-related powders in the world marketplace in Buffalo, US, was at a premium to the average Metal Bulletin price for APT. The pilot plant has the ability to produce the highest-purity APT and composite material from incredibly low-grade concentrate. It has recently had an economic audit completed, which involved additional testing and evaluation at a continuous plant operational level, to aid in making a commercial and economically-viable decision. The APT produced has exceeded expectations for trace-level impurities, thus providing an enhanced final APT product. The location of the Tundra JV makes it eligible for government incentives such as discounted electricity. This is a bonus in minimising capital expenditure and operating costs throughout the life of the plant. Tungsten APT has a two-year average price of about US$250/MTU, and prices have recently remained above US$253/MTU on the back of continued tight Chinese supply and robust demand. With more industrial applications appearing on the marketplace using tungsten, such as steel strengtheners and drill bits, one specialist niche is potentially able to use up to 10% of the global supply of tungsten in the near future. Tungsten is being used in leadreplacement applications due to its densification and non-toxicity attributes, and it has already been successfully substituted for lead in fishing sinkers and jigs, ballistics and x-ray machines.

N

ORTH American Tungsten Corporation (NTC: TSX-V) is a publicly-listed Tier 1 junior resource company that is primarily engaged in the operation, development and acquisition of tungsten and other related mineral properties in Canada. The company's 100%-owned Cantung mine and Mactung development project make it one of the few tungsten producers with a strategic development asset in the politically stable Western world. The basis of NTC's operations are made up of three pillars of strength and achievement: the Cantung mine, the Mactung project and the Tundra pilot plant.

Key points to consider when considering the vast size and grade of Mactung are: Mactung's grade is significantly higher than the average grade of currently operating Chinese tungsten mines Mactung is located in a politically-stable country with transparent mining and ownership laws At current tungsten prices, Mactung is worth approximately US$6.1billion. To put this into context of more familiar metals, this equates to a 12Moz gold deposit (at US$650/oz) or an 80Mlb uranium deposit (at US$100/lb U3O8) One MTU is equal to 10kg of WO3 per tonne, or 7.93kg of pure tungsten, and is the standard weight measure used in the industry.

FIRST PILLAR ­ CANTUNG

The first `pillar' is the wholly-owned Cantung mine, located in Canada's Northwest Territories. The underground mine, which is a primary producer of tungsten concentrate, opened in 1962. After a period of being on care and maintenance it is now back in operation and currently produces approximately 300,000MTU of tungsten concentrate (WO3) per year (2007 production: 286,031MTU). Recent underground development and exploration drilling has intersected high-grade zones, some of which are proximal to existing mine workings. Selected high-grade results from recent drilling include: 16.5ft at 5.72% WO3; 16.9ft at 4.16% WO3;

12ft at 3.24% WO3; 16.9ft at 4.16% WO3 (U-1233); 33ft at 3.24% WO3, including 16.5ft at 5.72% WO3 (U-1244); and 33.3ft at 1.81% WO3, including 12.8ft at 3.14% WO3 (U-1245). An independent, updated resource estimate is expected to be complete in the latter half of 2008. The existing indicated resource (NI43-101-compliant from September 2006) comprises 3.0Mt grading 1.21% WO3 (3.5 million STUs); 734,000t of inferred resources grading 0.74% WO3 (543,000STUs); and approximately 1Mt of probable reserves grading 1.17% WO3 (1.2 million STUs).

SECOND PILLAR ­ MACTUNG

The Mactung project is by far the company's largest asset and second pillar because of its size, grade and location. It is one of the largest known undeveloped, high-grade, tungsten-skarn deposits in the world. The project, located in the Yukon, is NI43-101 compliant, with indicated resources of 33Mt grading an average of 0.88% WO3, and an inferred mineral resource estimate of 11.3Mt grading 0.78% WO3. Wardrop Engineering Inc reviewed the historical feasibility studies to produce an undated economic assessment on Mactung in October 2007, after which a feasibility study commenced on the project. The bankable feasibility is on target to be complete by August 2008. At this time all permits will be filed, including mining, environmental and water permits, followed by construction, with a target for Mactung to be operational by 2012.

CONTACTS

North American Tungsten Corporation 1640-1188 West Georgia Street,Vancouver, BC V6E 4A2, Canada Tel: +1 604 684 5300 Fax: +1 604 684 2992 Mobile: +1 604 512 1400 Contact: Toni Williamson PhD, corporate geologist Email: [email protected] Web: www.natungsten.com

12

June 2008 Mining Journal special publication Tungsten

PROFILE

Oriental Minerals is developing one of the world's largest tungsten projects

O

RIENTAL Minerals is a Canada-based exploration and mine-development company with a diverse portfolio of precious and base-metal projects in South Korea. These include the Sangdong tungsten-molybdenum mine and the Ogcheon uranium project, as well as a number of other properties with significant known mineralisation and excellent regional potential. The company has assembled a highly-skilled, locally-based, bilingual technical team and a board of directors with outstanding and relevant experience. Oriental Minerals is the only operating Western exploration company in South Korea and it has significant early access to available opportunities countrywide. Oriental Minerals is focusing its primary efforts on the Sangdong tungsten-moly project; historically, one of the world's largest producing tungsten mines. In mid-2006 the company acquired Sangdong, which was closed in 1992 due to low commodity prices, and restarted drilling in early 2007 to re-evaluate its bulk-mining potential (only high-grade veins were previously mined). Soon after, the company identified a mineralised zone measuring 600m by 1,200m and 150-200m thick. In March, Oriental Minerals released an NI43-101compliant resource estimate (based only on the first 42 holes drilled), which put the Sangdong resource at 12.7Mt of 0.32% WO3 (tungsten), and 0.06% MoS2 (molybdenum) indicated plus 67.7Mt of 0.29% WO3 and 0.06% MoS2 inferred. This estimate made Sangdong one of the largest undeveloped tungsten deposits in the world. Since then, Oriental Minerals has drilled an additional 37 holes (for a total of 79 holes drilled) and completed a total of 20,000m of drilling. Four drill rigs continue to turn at Sangdong, both infilling and stepping out, as the company moves towards completing its current 87-hole drill programme. Wardrop Engineering is working on a preliminary economic assessment (PEA), also known as a scoping study, which should be completed by the fourth

CONTACTS

Oriental Minerals 24th Floor, 1111 West Georgia Street Vancouver BC V6E 4M3, Canada E-mail: [email protected] Website: www.orientalminerals.com Contact: Spiro Kletas Tel: +1 604 681 5755 Fax: +1 604 684 2990 Ticker: TSX.V:OTL

quarter of this year. Included in the PEA will be the results of Oriental Minerals' last 45 holes of its current drill programme, which should result in a substantial increase in the resource. Furthermore, environmental and metallurgical studies are ongoing. The company recently sent a 600kg sample for metallurgical testing to SGS in Cornwall, UK. Oriental Minerals intends to fast-track Sangdong into production and is planning to commission a feasibility study soon after completion of the PEA. South Korea is an independent country with strong US ties, and it is a key trading partner with Canada and Australia. The world's tenth-largest economy, South Korea welcomes overseas investment, having recently increased foreign-ownership allowance from 49% to 100%. The country has well-established, workable mining laws, a locally-available trained mining workforce and excellent logistics infrastructure. South Korea is centrally located in Asia, where the high industrial growth rates are driving demand for tungsten and molybdenum. The world's largest producer, China, recently restricted the export of these metals as they are needed for its own consumption. Many observers are forecasting increased consumption and global pricing for tungsten and molybdenum, driven mainly by growth in Asia. Both tungsten and molybdenum are used as alloys in steel-making. South Korea is home to some of the largest consumers of tungsten and molybdenum ­ such as steel-maker Posco, Hyundai Heavy Industries (the world's largest ship-builder) and TaeguTec (part of

Warren Buffet's IMC Group) ­ and they currently import 100% of both metals for their use. Even though an updated NI43-101 is expected to increase the size of the deposit, Oriental Minerals already has a significant amount of tungsten and molybdenum in situ. The current resource estimate equates to roughly 522Mlb of tungsten (currently priced at approximately US$13/lb) and 81Mlb of molybdenum (about US$32/lb). To add to the above, Sangdong has a historic `deep molybdenum' zone identified and drilled out by the Koreans in the 1980s. It is estimated (nonNI43-101-compliant) to be 120Mt at 0.14% MoS2, including a high-grade section of 16Mt 0.40% MoS2. This `deep moly' zone has been drilled by Oriental Minerals. However, the zone has not been included in its current resource estimate. Its drill result from this zone, though, returned 441m of 0.10% MoS2 beneath 177m of 0.16% WO3 (hole SD-20). All drill results so far confirm the company's original theory of the bulk-mining potential at Sangdong.While there is a lot of work to do to prove up the resource, and numerous studies that will need to be completed, the future looks highly encouraging for Oriental Minerals and its tungsten-molybdenum project.

Sangdong, looking west (below); drill hole (above)

June 2008 Mining Journal special publication Tungsten

13

PROFILE

Fast-tracking an early production opportunity in Spain

O

RMONDE Mining plc has plans to become a significant European tungsten producer by fast-tracking the development of its Barruecopardo project in Spain. Ormonde recently reported a threefold increase in the resource estimate for the project, which now stands at 3Mt at an average grade of 0.6% WO3, or 18,000t of contained WO3. Engineering studies are now in progress to facilitate an early production decision, with initial tungsten production targeted for the end of 2009. BACKGROUND Located in an historic tungsten-producing area in the Salamanca Province of western Spain, Barruecopardo operated as an open-pit tungsten mine until the early 1980s. Like most Western tungsten mines, the operation was forced to close at that time due to the low prices forced upon the market by low-cost Chinese producers. With a production rate of up to 800,000t/y, it was one of Europe's largest tungsten mines, producing a very high-quality scheelite concentrate. Ormonde acquired the rights to Barruecopardo in 2005 as part of a joint venture with private Spanish companies over an extensive ground package in west Salamanca prospective for both tungsten and gold. Through funding the evaluation programmes on Barruecopardo and other prospects in the permit area, Ormonde currently has a 90% interest. Located on a brownfield site, the project is well served by existing road and power infrastructure and it enjoys strong community support.

GEOLOGY

Tungsten mineralisation at Barruecopardo occurs as scheelite and wolframite in quartz veins that form part of a major granite-hosted vein swarm. Ormonde's drilling has shown that the vein system has a total strike length of over 1,500m and extends deeper than 200m. The system is open both along-strike to the north and south, and at depth.Veins generally have a NNE strike and dip steeply to the east. Greisen alteration is commonly associated with the quartz veins. EXPLORATION Ormonde's drilling programme in 2006-07 initially focused on high-grade tungsten veins occurring in the northern extension of the main open-pit mine (in the Filon Maestro mineralised zone). In late 2007 and early 2008, initial drilling of the southern area below the old open pit (targeted on the Filon Principal zone, which has a known strike length of 850m) demonstrated the potential for significant widths of high-grade tungsten within a broader, low-grade zone. Drilling has now defined a tungsten deposit at Barruecopardo with multiple mineralised zones. The new resource estimate for the project, prepared by independent consultants CSA Global, is 3Mt grading 0.60% WO3 in the JORC inferred category, up threefold on the company's previous estimate. The scale of the increase in the resource reflects the success of the company's drilling programmes and the identification of new resource zones along the known 1.5km strike length of the Barruecopardo deposit. There is extensive, additional resource potential as the resource zones remain completely open along strike and at depth. Additional resource targets include the adjacent Valdegallegos area, where a single Ormonde drill hole returned a high-grade tungsten interval, and several other prospect areas within the company's extensive ground holding surrounding Barruecopardo. Further drilling success in these areas would add to the project's long-term resource base. ORDER-OF-MAGNITUDE STUDY (JAN 08) The mining assumptions in the study are for an initial production rate of 200,000t/y, with underground access and ore transport via a decline from the surface. The steep dips, good ground conditions and visually distinctive mineralised zones should make for favourable mining conditions. The mining method envisaged by the study is predominantly mechanised, long-hole stoping with occasional use of shrinkage stoping. A minimum mining width of 2m was assumed for the mechanised mining method. The production rate may be increased post start-up when exploration of the other zones is advanced and multiple access points have been developed to all tungsten zones.

Barruecopardo open-pit tungsten mine when operational MINERAL PROCESSING Scoping metallurgical testwork carried out last year showed that the tungsten minerals are coarse-grained and will be concentrated effectively by traditional, low-cost gravity equipment. The order-of-magnitude study therefore assumed that the tungsten ore would be processed via a three-stage crushing, a rod mill for coarse grinding, a gravity preconcentration circuit (using a combination of jigs and spirals) and a final clean-up circuit to produce a saleable concentrate. The study assumed overall tungsten recoveries of 70-80%, based on the results of the scoping testwork and documentation from the historic Barruecopardo open-pit operation. These grades and recoveries would result in production of around 90,000mtu of WO3 per year. Additional testwork is in progress to facilitate detailed process-plant design. FINANCIAL ANALYSIS The study's preliminary capital-cost estimate is 10-15 million. This is for the development of an underground decline mine, construction of a 28t/hr processing plant and site infrastructure. Operating cost estimates are 23-45/t, with figures varying depending on the proportion of mechanised to shrinkage stoping. Based on these costs, with head grades varying from 0.6-0.7% WO3, and assuming tungsten concentrate prices of US$180/mtu WO3, the proposed 200,000t/y operation at Barruecopardo could generate an annual cashflow in the region of 5 million.

CONTACTS

Ormonde Mining plc Metges Lane, Navan, Co Meath, Ireland Tel: +353 46 9073623 Fax: +353 46 9073654 Web: www.ormondemining.com Contact: Fraser Gardiner E-mail: [email protected]

Detailed plan of the Barruecopardo project

14

June 2008 Mining Journal special publication Tungsten

PROFILE

Wolfram Camp reopened, recapitalised and revitalised

W

OLFRAM Camp, Australia's most historic producer of significant quantities of tungsten, molybdenum and bismuth, begins production and concentrate shipments in July, marking Australia's return as a producer of tungsten concentrate. Almost two decades after Wolfram Camp's closure, the A$30 million redevelopment (including new crushers, screens and concentrators) will see the transition of the mine's new operator, Queensland Ores Ltd (QOL), from explorer to a debt-free and cashflow-producing tungsten and molybdenumconcentrate exporter. QOL holds an 85% interest in the project, with Tropical Metals Pty Ltd holding the other 15%. Located 90km west of Cairns in north Queensland, Wolfram Camp was first discovered in 1894. During a century of sporadic activity, the camp produced over 10,000t of wolframite, molybdenite and bismuth concentrates. QOL listed on the Australian Stock Exchange in 2005 (ASX: QOL), and redevelopment and construction work at Wolfram Camp began in November 2007. This May saw ore being fed into the new crushing plant in preparation for first concentrate sales in July. At an ore-feed rate of 150,000t/y, QOL is expected to produce a yearly average of some 600t WO3 in a 65% wolframite concentrate and 250,000lb Mo in a 50% molybdenum concentrate. At current prices this would provide the firm with revenue of A$20 million per annum. The in-ground value of the ore (at current prices) is about US$140t while operating costs are estimated at A$75/t of treated ore. In May, QOL announced a A$12 million capital raising that will leave the company debt free and with additional exploration funds to conduct near-mine definition drilling to increase the size of the current Wolfram Camp resource. QOL's managing director, Taff Greenwood, says it has been a "fascinating journey for Queensland Ores in the past six months. Just as we were ticking all the right boxes on construction, world financial and credit markets started to deteriorate. To have raised A$12 million at such a time I see as a vote of confidence in the project and the opportunities we see for expansion. "The construction strategy of using prefabricated, modular components wherever possible has assisted us greatly. To deliver a mining project within six months is very satisfying," he continues. "After getting the mine into production we will be able to focus on the longer

RESOURCE POTENTIAL

The Joint Ore Reserves Committee (JORC)compliant resources for Wolfram Camp comprise: measured resources of 598,200t at 0.42% WO3, 0.17% MoS2, 0.03% Bi; indicated resources of 111,500t at 0.41% WO3, 0.16% MoS2, 0.03% Bi; and inferred resources of 238,300t at 0.4% WO3 and 0.2% MoS2. "Once we have defined a larger resource we can review our options for production expansion," says Mr Greenwood. QOL will also review its options for Bamford Hill, located 30km south of Wolfram Camp, where the company is earning up to an 85% interest. The area covered by the Bamford Hill EPM has previously produced significant quantities of tin, tungsten, molybdenum, bismuth, silver and lead. "Bamford Hill is a fascinating prospect for us. Do we develop and truck the ore to Wolfram Camp or will a potential resource there justify a stand-alone operation? Admittedly, these are decisions for some time in the future, but they highlight the flexibility we now have to look at all our options to increase production in a region that for a century has been so rich and productive of these specialty metals." term. The options are now before us to look at ways to increase the Wolfram Camp resources and plant throughput. The longer-term possibility of trucking in ore from the nearby Bamford Hill exploration tenements, where we are earning a stake of up to 85%, is also an exciting thought." Mr Greenwood adds that "the real focus for the next six-to-nine months will be to get to steady-state production at Wolfram Camp and increase the in-ground resource towards 3Mt, so lifting the current mine life from its nominal four years to, say, 15 or 20 years. This would have a material impact on our long-term planning and financial outlook." MINE HISTORY The hard-rock mines of the Wolfram Camp mineral field have recorded a combined output of at least 10,000t of wolframite, molybdenite and bismuth concentrates. Although eluvial and early underground production is poorly recorded, the main periods of production included 1908-20, 1967-72 and 1978-82. Early surface workings led to the discovery of high-grade quartz pipes, which were then worked by underground means. These pipes ranged from less than 1m in diameter to 10m by 15m in plan, and had down-plunge lengths often exceeding 100m. Lowergrade mineralisation surrounds the pipes and has been mined in some cases. However, the bulk of this

OFF-TAKE AGREEMENTS

QOL has concentrate off-take agreements with Citic Australia and the right to test the market in the first year. There is an option to extend the off-take agreement to four years. Unexpected find of Wolframite at the location of the mine's first blast lower-grade mineralisation, which appears to exist in sheets of variable thickness, was not extracted and has been the main target of QOL's evaluation work. Historical production has been heavily influenced by commodity prices, increasing significantly during World War I, but with a rapid reduction in production soon after. Production rebounded in the late 1960s and again in the 1970s before underground extraction became increasingly difficult and costly. When commodity prices fell in the 1980s the field became uneconomic and mining operations ceased. MINE DEVELOPMENT In 2004, QOL looked to revitalise Wolfram Camp using modern mining and treatment methods and take a regional perspective to exploration. The ore and waste is being mined by conventional open-cut means from 1.5m-high flitches and then hauled to a run-of-mine stockpile or waste dump by 40t, six-wheel-drive articulated dump trucks. The ore is treated in a custom-designed treatment plant by a combination of flotation and gravity techniques. The current pit design is 650m long by 150m wide, and the four-year mine plan envisages a strip ratio of 7:1, with 4.2Mt of waste required to be mined to recover 600,000t of ore for the 150,000t/y mill feed.

CONTACTS

Queensland Ores Ltd Level 3, 201 Leichardt, Springhill QLD 4000, PO Box 1078, Springhill QLD 4004, Australia Website: www.qol.com.au Email: [email protected]res.com.au Tel: (07) 3230 2000 Fax: (07) 3831 7663 ASX Ticker: QOL

June 2008 Mining Journal special publication Tungsten

15

www.vitalmetals.com.au PO Box 8243 Subiaco East ~ Western Australia 6008 Ph: +61 8 9388 7742 Fax: +61 8 9388 0804 ABN 32 112 032 596

Image: Aerial View of Watershed Camp and surrounding landscape

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