As tungsten prices continue to increase, junior explorer Ormonde Mining (LSE:ORM) is moving forward with its Barruecopardo project.
On Wednesday (September 6), the company said it’s on schedule for commissioning at the project in the third quarter of 2018. Construction activities are underway, with several contracts awarded for the Spain-based project, the company added.
Ormonde has a 30-percent interest in the fully permitted Barruecopardo project. The rest is held by OCM Tungsten Holdings, a subsidiary of Oaktree Capital Management (NYSE:OAK).
“With the ammonium paratungstate (APT) price continuing to climb steadily, indications are that the decision to accelerate construction at the Project has been a timely and appropriate one,” Steve Nicol, Ormonde’s managing director, said in a statement.
According to the company, APT prices touched a low of $162 per metric tonne unit (mtu) in January 2016, following a period associated with a general weakening of the commodity markets.
Currently, APT prices are trading between $285 and $300 per mtu, an almost 50-percent increase since the beginning of last year. Prices have been supported by better economic conditions in Europe and US, as well as supply disruptions from top producer China.
“With the very positive decision, taken in early June this year, to advance the project into an accelerated construction and implementation phase, the intervening period has been exceptionally busy at the project,” Nicol added.
Some 50 people are now working on the site, with the majority being from Barruecopardo and immediately adjacent towns. Construction of the main dam was awarded to Cerezo, a Spanish company that mobilized to site in early July. Meanwhile, the civil works contract was awarded to Copisa, another Spanish company; it will begin activities in October.
Barruecopardo will be an open-pit mine with an initial life of nine years. It will produce 260,000 mtu of tungsten trioxide at steady state. Ormonde is one of a number of companies currently advancing tungsten projects in Spain.
On Wednesday, Ormonde’s share price closed up 2.94 percent in London at GBX 2.52. The company has been surging since the beginning of the year, and has gained 55.2 percent year-to-date.
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Securities Disclosure: I, Priscila Barrera, hold no direct investment interest in any company mentioned in this article.