Viking Mines (ASX:VKA) has entered into a binding terms sheet with US-based BLK Group to acquire six tungsten projects in Nevada, US.
The six projects are named Linka, Alpine, Long, Terrell, Ragged, and Victory.
The staged-purchase agreements are over a seven-year period, with Viking Mines paying a total of US$2.88 million ($3.44 million). The project vendors will retain a 2% net smelter return (NSR) on all minerals recovered from the projects.
Viking Mines, which has a market capitalisation of $13.6 million, can pay US$2 million cash to bring the NSR down to 1% ahead of completing the acquisition payments.
The company will also conduct a $4.29 million two-tranche placement at an issue price of $0.005 per share.
Tranche two includes an investment from American Tungsten (CSE:TUNG), which will subscribe for 150 million shares – representing a $750,000 investment.
GTT Ventures and Advantage Management will act as joint lead managers to the placement.
Funds will be used for exploring and evaluating the six newly-acquired projects, as well as exploration across existing assets in Western Australia. The funds will also be used for project payments, business development opportunities, and general working capital.
Viking Mines has begun due diligence and recently completed a field visit. A ground assessment was carried out on the projects, including sampling and claim verification.
CEO Julian Woodcock says securing this tungsten portfolio in Nevada, alongside the strategic investment from American Tungsten, is a step forward for Viking.
“The project’s history of production, combined with high-grade historical results and existing drill targets, provides a strong foundation for the company to delineate a critical mineral resource in the US,” Woodcock says.
“With tungsten designated as a critical defence mineral and prices reaching record highs, the macro environment is highly favourably for this acquisition.
“We have secured these assets on attractive commercial terms and look forward to commencing our exploration program to test the project’s full potential.”
American Tungsten CEO Ali Haji says the company’s decision is anchored in a simple view: tungsten’s outlook has rarely been stronger, and secure western supply has never been more important.
“This investment complements American Tungsten’s existing US footprint,” Haji says.
“We are advancing our brownfields IMA Tungsten Mine toward production, and Viking’s projects create clear strategic alignment across exploration, resource growth, and future domestic supply.”
The flagship Linka Project hosts mineralisation in three historical mines occurring 820m of strike length, which remains open to the northeast and southwest, with extensions untested below shallow cover.
Linka demonstrates proven production history via a 360 tonnes per day mill between 1955 and 1956, which treated ore from the three mines, delivering high-grade stopes up to 3% tungsten.
Viking Mines has developed a three-pillar strategy to advance the US tungsten portfolio. This includes aggressive exploration to define a mineral resource, metallurgical testwork to refine downstream processing, and active engagement with the US Government to secure funding for the critical mineral.
Due to Linka’s scale and production history, this project will be the main focus for the company while parallel field investigations advance the broader pipeline to provide optionality.
Write to Aaliyah Rogan at Mining.com.au
Images: Viking Mines
