Allied Critical hits high on Portugal tungsten cores

Allied Critical Metals (CSE: ACM) soared to a new high on Tuesday as early drilling results indicated the presence of extensive tungsten mineralization at its past-producing Borralha project in Portugal.

Initial drilling has intersected more than 200 metres of tungsten mineralization at the newly defined Venise target, the Canadian explorer said in a release. The finding lies in a historically recognized breccia system that hadn’t been systematically tested and may help the company expand the resource in last month’s preliminary economic assessment (PEA).

“These initial results bode very well for our fully funded drilling campaign at the Borralha project,” CEO Roy Bonnell said. “Located approximately 400 metres from the Santa Helena Breccia deposit, which underpins our recently announced initial PEA, this result reinforces our view that the Borralha project hosts multiple breccia systems.”

Shares of Allied Critical surged 8.4% to a new all-time high of $1.88 on the drill results. Its market capitalization is at $320 million.

District-scale

Located at a former tungsten mine 60 km east of the city of Braga, the project’s Santa Helena deposit hosts 13 million tonnes grading 0.21% tungsten trioxide (WO₃) in the measured and indicated category and 7 million tonnes grading 0.18% WO₃ in the inferred category. 

The PEA envisages an 11-year mine producing 1,708 tonnes of WO₃ annually, with the potential for expansion. Its after-tax net present value is calculated at $473 million, with an internal rate of return of 49%, assuming an 8% discount rate and WO₃ price of US$1,000/mtu.

The Venise target, which was recently identified through an ongoing 20,000-metre drill program, was excluded from the PEA mine plan. According to Allied Critical, this breccia system was historically recognized in underground workings and documented in geological studies in the 1970s and 1980s, but these zones have not been systematically tested using modern exploration methods.

National importance

The new target reinforces Borralha’s potential as a district-scale tungsten system that would contribute to the EU and NATO supply chains, the company said. 

Borralha has been endorsed by idD Portugal Defence. The state-owned coordinator of the country’s defence industry and international partnerships recently designated the project as of strategic national importance. Currently, the project undergoing its environmental review process.

“We are encouraged by these early results and continue to believe the Borralha project is a world-class tungsten deposit with the possibility of being a meaningful new supply of tungsten,” Bonnell stated.

Drilling at the property remains in progress and is advancing toward the interpreted central portion of the breccia body, the company said.