UK government takes stake in miner after £71m injection
The government’s National Wealth Fund is set to pump £71m into miner Tungsten West in a bid to help reopen the Hemerdon mine in Devon. The funding package combines a £36m share purchase, which will hand the government a 7.4 per cent stake in Tungsten and a seat on the board of directors, and a [...]
The UK government is investing £71 million in miner Tungsten West to help reopen the Hemerdon mine in Devon. This funding, which includes a £36 million share purchase and a £25 million loan facility, will grant the government a 7.4% stake in the company and a seat on its board. The project is anticipated to create 350 direct jobs in the South West of England, contributing to the local economy.
In addition to the financial backing, the government will have the option to purchase up to half of the mine's future tungsten output. Chancellor John Healey emphasized that this investment will provide essential minerals to British defense, energy, and aerospace businesses, ensuring job creation in the UK. Tungsten West, headquartered in Plympton, Devon, focuses on the mining and extraction of tungsten, tin, and secondary aggregates.
The company's CEO, Jeff Court, highlighted the importance of prioritizing UK requirements for this critical metal to support domestic demand in defense and energy sectors. The Hemerdon Mine, previously known as Drakelands Mine, was closed in October 2018 due to Wolf Minerals' liquidation. Tungsten West acquired the site in 2019 and has since redesigned the processing layout and secured new environmental permits.
The fresh capital will be used to reconstruct and upgrade processing equipment, cover operational costs, and fund labor and operations to reach full metal production. The UK government's shares in Tungsten West are set to be listed on the stock market on August 27th, with mining operations scheduled to restart in the third quarter.
This move represents the National Wealth Fund's continued support for key markets such as defense and energy. The policy bank's £599 million financing package for Rolls-Royce Small Modular Reactors, aimed at kickstarting its project with Great British Energy, is another example of the government utilizing taxpayer-backed funds to de-risk projects and attract private investment, potentially creating thousands of jobs.
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