PERTH (miningweekly.com) – ASX-listed tungsten-miner Hazelwood Resources has agreed to buy a 70% interest in the tungsten and molybdenum rights of the Mount Mulgine project, in Western Australia.

Hazelwood would acquire the stake from Vital Metals for A$450 000 in cash.

The acquisition would provide Hazelwood with the opportunity to generate additional sources of feedstock for its ATC ferrotungsten project, which was currently under construction in Vietnam.

The remaining 30% interest in the tungsten and molybdenum rights, as well as the legal title to the tenure would be held by ASX-listed Gindalbie Metals, under a joint-venture agreement.

The Mount Mulgine project was estimated to host around 11,2-million tons of tungsten oxide.

The tungsten miner said in a statement that it would make use of well-preserved drill-core samples to fast-track the estimation of a Joint Ore Reserve Committee-compliant resource for the Mount Mulgine project.

During this time, Hazelwood would also examine opportunities to produce high-quality feedstock of ferrotungsten production or lower grade feedstock for sodium tungsten production at the ATC facilities.

At full capacity, the ATC plant would be the largest producer of ferrotungsten outside China, and capable of fulfilling about 25% of the global demand for the product.

The initial production capacity during stage one is about two-million kilograms a year of contained tungsten, in the form of 80% grade ferrotungsten. The company also had plans to increase production to about 4,8-million kilograms a year of contained tungsten during 2012, subject to permitting and approvals.

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