Australian miner, Hazelwood Resources, has acquired a 60% interest in a new ferrotungsten plant in Vietnam as part of its vertical integration strategy. The plant is expected to be commissioned towards the end of this year and will be located near the port of Haiphong in northern Vietnam.
Hazelwood will pay $825,000 to acquire 60% of the share capital of Hong Kong Based Asia Tungsten Products Company Ltd and will contribute 60% of the capex and provide working capital as a loan. Capex for the first stage the project is approximately $US16.3m.
The plant will have the capability of providing 25% of the world’s ferrotungsten and will be able to operate on feedstock from multiple sources, including concentrate from Hazelwood’s Big Hill Tungsten Project in Western Australia.
At full capacity projected annual turnovers are $US150m at the current ferrotungsten price of $US31.50/kg. Profit after tax for ATC HK is projected at $US32m per annum from 2012. The project is anticipated to be cashflow positive late 2011/early 2012.
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