Canada poised to fill growing demand for tungsten

Tungsten has uses in many industries including transportation, mining, oil and gas, and construction because of its hardness and heat resistance. — Photo courtesy Northcliff Resources

Tungsten might be Canada’s next resource to watch at the rate that its worth is growing worldwide. The tough metal has the highest melting point of any metal, is resistant to corrosion and is extremely hard and dense. It has a variety of uses in the transportation, mining, oil and gas, and construction industries, among others.

China has ranked as the largest producer in previous years. Discovering another tungsten deposit in New Brunswick sets Canada on a positive path as a growing tungsten contender.

The Sisson Tungsten-Molybdenum Project was acquired by the Sisson Partnership in 2010—the perfect time to jump on a tungsten opportunity with high market rates worldwide. Sisson Partnership is subsequently owned by Northcliff Resources Ltd. (88.5 per cent) and Todd Minerals Ltd. (11.5 per cent). Northcliff is the operator of the advanced-stage Tungsten-Molybdenum Project in New Brunswick; Todd is the financing partner. The Sisson Project is 100 kilometres northwest of Fredericton.

A positive response to Sisson’s environmental assessment

In June of 2017, Northcliff announced positive results from the federal environmental assessment that Sisson submitted in 2013. They received provincial approval in 2015. This significant milestone has been years in the making. Everyone involved is eager to move onto the next steps leading to production.

The challenges of an environmental assessment are technical, social and regulatory. “Like any project around the world, getting through the environmental assessment is a hurdle,” said Chris Zahovskis, president and CEO of Northcliff. “Not only are there a lot of technical aspects to consider and resolve, but there are also many social aspects along with it.” Sisson’s environmental impact assessment included engaging with the stakeholders, as well as engaging with the First Nations of the project area.

The location of the Sisson Project in New Brunswick gives Sisson an advantage in terms of infrastructure and potential employees. They will be able to hire local, skilled and experienced workers without looking outside the province.

The local community is on board for this tungsten project as well. “We have a register of over 300 businesses who have expressed various interest in participating in one way or another and have some very significant skills,” Zahovskis said. “We don’t see the need to have to go beyond the province for much.”

Overall, the government found that there were no significant adverse affects from an environmental standpoint as a result of executing the Sisson Project. “The safeguards and mitigation we have put in place have been assessed to be nonimpact,” Zahovskis said.

The Sisson Project is located about 100 kilometres northwest of Fredericton, New Brunswick. — Photo courtesy Northcliff Resources

One of the environmental focuses of the project is protecting the wildlife of the Nashwaak Watershed through surplus water treatment, water storage, secure tailings storage and regular water quality monitoring. “We have world-class engineers working on the project,” Zahovskis said.

Tungsten mines require contracts before finances

The tungsten commodity is much different from other resources. Gold, for example, is produced and sold to the mint. “Tungsten is a very small market, so you need to have off takers lined up and agreeing to take a good portion of your production before you can line up the finances,” said Zahovskis.

The unique challenges to tungsten make determining a project timeline at this point difficult. Sisson has already been in discussion with potential off takers around the world for five years now—they began long before the federal assessment was complete. The goal is to secure long-term contracts, which will let them move forward with discussions about financing.

Sisson must tackle project permitting

Although the approval is important, the Sisson Partnership now has the hurdle of permitting to face: permits to construct, operate and, eventually, close the mine. “We are marching down the road, systematically working through the various permits we need to get,” said Zahovskis. “You start discussing specifics like water discharge levels, emission levels and so on.” Needless to say, it is a lengthy and technical process, including more discussions with governments and regulatory agencies.

Market clarity and financial backing

After Sisson has a sense of how its permitting and off taker engagement is going, the company can approach banks and lending institutions. “The markets have obviously changed,” Zahovskis said, referring to the markets when they first submitted the environmental assessment in 2013. “We are at a point where we need to find clarity in terms of where the market is going before we can make any firm decisions on commitment for timing.”

Finding a tungsten partner

Northcliff is in the process of searching for a strategic partner. “We do have a partner right now, but we have always stated that it would be nice to have a tungsten player to be a partner,” Zahovskis said. “We will continue to have discussions with potential parties.”

After the permitting, contracts, finances and partnership paperwork are out of the way, construction can finally begin at the Sisson Tungsten-Molybdenum Project. Construction will be a two-year build.