The US Department of Defense announced on Friday that it would provide a $15.8 million grant to the Canadian company Fireweed Metals. The project aims to accelerate the development of the tungsten mine in Mactung, Yukon Territory, Canada, which is one of the world’s largest undeveloped high-grade tungsten deposits.
Notably, this is a joint development project supported by both the US and Canadian governments. The Canadian Ministry of Natural Resources will also provide a bonus of $12.9 million Canadian dollars (approximately $9.2 million US dollars) to improve the infrastructure of the mining area, including road and power planning.
Mactung is the largest undeveloped high-grade tungsten deposit in the world. Fireweed estimates that the deposit has ample resources to meet North America’s tungsten demand for decades. The company stated that this joint investment would be an excellent opportunity to “address the critical supply chain vulnerabilities in North American industrial base.”
The US Department of Defense stated that the investment funds come from the “2022 Ukraine Additional Appropriations Act” and would support the goals of the “2024 Defense Industrial Strategy,” which aims to expand support for domestic critical mineral production.
The US Department of Defense stated that the “US-Canada Critical Minerals Joint Action Plan” was announced in January 2020. This plan promotes critical mineral production in North America, which helps strengthen the supply chains for defense, aerospace, clean energy, communication, and other key industries in both countries.
Laura Taylor-Kale, Assistant Secretary of Defense for Industrial Base Policy, said, “Tungsten is essential for a variety of weapon systems of the Department of Defense and is crucial for national security.”
She added, “The US has relied excessively on overseas tungsten resources, but expanding the secure supply of tungsten in North America will reduce one of our most critical material risks. This grant program also highlights the importance of the cooperation between the US Department of Defense and Canadian allies.”
Tungsten is a highly durable metal known for its unique properties that make it indispensable in a range of civilian and military applications. It is commonly used in cutting tools, drills, machine wear parts, military steels, aerospace components, ammunition, and is a key material in vehicle armor.
For decades, Chinese companies have flooded the global market with cheap tungsten, squeezing out competitors and eventually controlling 80% of the supply chain. However, as tensions between China and Western countries deepen, efforts have been made worldwide to reduce dependency on China, with projects emerging to replace Chinese supply chains.
Earlier this year, US government researchers also visited the Sangdong mine in South Korea to evaluate the progress of reopening the mine. The Sangdong tungsten mine is owned by a subsidiary of Canadian company Almonty Industries. Almonty stated that the mine has the potential to meet 10% of the global tungsten demand.
With the latest grant from the US, Fireweed will be able to expedite the research, development, and production at the Mactung deposit, enhancing its operational flexibility and reliability as a North American tungsten concentrate producer.
Canadian Minister of Natural Resources Jonathan Wilkinson stated, “Through continued cooperation with the US and other allied countries, we are developing secure critical mineral value chains that will strengthen national and economic security for Canadaand the United States, and create robust economic prospectsfor workers and businesses in both countries.”