https://news.mk.co.kr/newsRead.php?year=2012&no=249468
Warren Buffett invests $70.1 mn to reopen S. Korea’s tungsten mine
The Sangdong Mines, located in Yeongwol-gun, Gangwon Province of South Korea, will be reopening 18 years since its closure in 1994 as Warren Buffett decides to invest in the strategic metal.
Gangwon Province, Yeongwol-gun, and Iscar Metalworking Companies (IMC) will be signing a memorandum of understanding (MOU) Wednesday for a C$70 million (Canadian dollars, 80 billion Korean won) investment, people familiar with the matter disclosed Tuesday.
Through this agreement, IMC will be acquiring shares of Sangdong Mining to obtain mining rights for the Sangdong Mines. The mined products will be used to produce tungsten powder and other related industrial products.
Tungsten is a core industrial metal used to make a wide variety of products including light bulb filaments, auto parts, weaponry, electronics, and golf clubs. Tungsten prices had taken a heavy blow in the past when China’s overproduction and exports resulted in global oversupply. As China starts conserving its strategic resources and switching to imports, however, tungsten values have floated up and it is now classified a key strategic metal alongside other rare earth metals.
The global market price of tungsten had dropped to $38 per 10 kilograms (kg) in 1994, but has since grown more than 12-folds to reach $450. This price recovery also greatly improved the economic feasibility of tungsten mining and production of other tungsten products.
The Sangdong Mines are estimated to hold a tungsten reserve of 103 million tons (t), which can sustain mining activities for the next 100 to 200 years.
Gangwon Province believes IMC’s investment will directly create eight million jobs and indirectly help settle 120 new local manufacturers as existing manufacturers relocate and new businesses sprout.
[Written by Hong-gu Jee - Samji Chung / edited by Soyoung Chung]
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