IFG Metals & Mining has built on its existing relationship with Uzbekistan’s geology and mineral resources committee and signed an agreement giving it exclusive rights to carry out feasibility studies and, if proven successful, exploit seven tungsten deposits in Uzbekistan.
The aim of the $300 million long-term investment is to create a cluster for tungsten production and processing, according to IFG, a division of Central Asia focused advisory and investment company IFG Capital Partners.
Back in July, IFG and the State Committee of the Republic of Uzbekistan on Geology and Mineral Resources (Goscomgeology) signed a pact to carry out a feasibility study on developing the Yakhton tungsten deposit in the Samarkand region of the country.
IFG says its latest investment over the 25-30 year working lie of the cluster is the largest such foreign investment in Uzbekistan’s mining industry since the end of the Soviet Union.
As part of the agreement, IFG will develop the tungsten cluster and be the leading principal investor in the project. Sun Group, which is active in India, Russia, West Africa and other emerging markets, has agreed to co-invest with IFG in the exploration and development of the tungsten cluster, subject to further due diligence.
As a result, IFG, Goscomgeology and Sun Group on September 28 signed an agreement on joint development of seven tungsten deposits in Uzbekistan during the Indian-Uzbek Business Forum held as part of the official visit of Uzbekistan’s President Shavkat Mirziyoyev to India.
IFG intends to conduct a feasibility analysis into the exploration and development of the Ingichke, Gussay, Sarykul, Kara-Tyube, Lyangar and Koytash tungsten deposits, with the purpose of processing ore into concentrate. The Yakhton deposit will also become part of the cluster. Should the studies produce positive results, IFG has the exclusive rights to manage the industrial development of the deposits.
Olga Ponkratova, Managing Partner of IFG and head of IFG Metals and Mining, said growing shortfalls between global supply and demand have recently driven the tungsten price to its highest levels since September 2014, noting there is a growing expectation stronger pricing levels will continue for some time.
“This favorable market environment, coupled by the strong support that we have received from the government, makes this project possible,” he said.
Preliminary geological research indicates there is around 130,000 t of tungsten oxide in the seven deposits with the average grade coming in higher than comparable projects, according to IFG. The company plans to build two mobile processing factories to process ore and export 100% of produced tungsten to North America and the EU.
IFG is drilling verification boreholes at each deposit to verify existing historical reserves and confirm past exploration data in accordance with international JORC standards. The first samples from the Yakhton deposit have already been sent abroad for metallurgical testing with results expected later this year.