Vital in $15m tungsten sale

Subiaco-based Vital Metals has agreed to sell its tungsten project in Queensland to Tungsten Mining for a cash consideration of $15 million.

Under the deal, West Perth-based Tungsten will acquire the Watershed project and all associated exploration permits.

The tungsten project is located 130 kilometres north of Cairns, with a review in March estimating a $106 million capital expenditure is required for the project.

The agreement is subject to a number of conditions including shareholder and regulatory approval.

Vital said it was focused on its Bouli gold project in West Africa.

“The company is extremely encouraged with the results from drilling at the Bella Tondi prospect within the greater Bouli gold project,” Vital said in a statement to the ASX.

“The company is delighted to be able to realise $15 million in cash from selling its Watershed tungsten project and also to sell to Tungsten Mining, a dedicated tungsten company.

“The proceeds from the sale will enable Vital to maintain an aggressive exploration program in West Africa.”

Tungsten chief executive Craig Ferrier said the company was delighted to have made the acquisition.

“Tungsten Mining have a stated objective of becoming a globally significant player in the tungsten industry,” he said

“The Watershed project complements our existing portfolio of advanced tungsten projects and substantial inventory of contained metal.”

Argonaut acted as Vital’s financial adviser to the transaction.

Shares in Vital were flat at 0.9 cents each at 130pm AEDT, while Tungsten shares had jumped 12.7 per cent to 71 cents each.