CEO Q&A: Almonty Industries’ Lewis Black

North American Mining Discusses The Future Of Mining, The Outlook For Tungsten And More With Almonty’s Lewis Black. Is U.S. Growth Part Of The Company’s Future?

By J. Weiss

Lewis Black

Many mining operators, no matter their respective place in the world, are working hard to reinvent, reimagine and retool – and for a number of reasons. Some are putting a new eye toward technology, others are evaluating environmental and sustainability efforts, and others still are formulating an again-refreshed outlook on health and safety.

To place that focus across many areas of business, while still maintaining a strong presence in one’s commodity, region and in the minds of the industry – it not quite as common.

North American Mining recently talked to Canadian-based Almonty Industries CEO Lewis on a number of issues, including the company’s newly expanded environmental, social and governance (ESG) program. He also responds to questions about the global operator’s position on a potential future in North America.

Your group is very forward-thinking when it comes to the future of mining. What elements do you feel will be key to mining’s success in the future?

Through the total embrace of ESG as well as education to the populace of any country that has mines – sharing how mines are now nothing like what they used to be. They can have a very low impact environmentally.

In fact, they also bring a great deal of benefits to what is normally a more isolated or rural area like economic growth. But most importantly are new mines, which are the only ones that can be built when you follow ESG programs.

You have talked a lot about clean energy mining and its role in the industry as well. Can you share why this is so important to Almonty, and why it needs to be important to your contemporaries?

Ultimately, I don’t think mining should be treated any differently than any other industrial unit. I think every industrial complex in countries that require stringent ESG should seek out more sustainable and renewable forms of energy. I don’t think mining should be treated any differently, especially given technology now being in such a place where you can no longer say, ‘Well, you know, it doesn’t work.’ Actually, they’re only a heartbeat away from giving you an underground electric unit that runs on batteries that will last the shift, and that’s really the key – lasting the whole shift on one battery pack.

It’s important because ultimately, consumers are at the end of the supply chain. It’s all about the carbon footprint and consumers are looking for all of their suppliers to make contributions towards negating that carbon footprint. I believe operators have to really now be much more cognizant of how to join the sustainable party.

The company recently expanded its ESG program. Can you elaborate on the details?

Our Portuguese project is 126 years old and is a ripe candidate to be dragged into the 21st century, be it rather slowly. Because it is an aging mine, you don’t know what’s going to drop off if you drag it too quickly.

For instance, we’ve just started the construction of a solar farm for the benefit of the mine, which will produce roughly 22% of the energy required at the mine. This is really a pilot plant so we can really understand the reliability of this program before embracing it on a greater scale. We have the advantage of being in southern Europe where there is a lot of sunshine, and more importantly, we’re also in a more mountainous area where there is wind.

In addition, government will support these initiatives, which is very helpful not just financially, but also through permitting. That being said, going slowly in Portugal since this mine was built so long ago is important to evaluate the infrastructures in place that may be a little fragile to change.

It is something we are very much embracing. And as for our Korea mine, it’s slightly different. We’re starting with a blank piece of paper, so we’ve been able to incorporate all kinds of ESP programs. Ultimately, with five generations of knowledge in Portugal, this has to be moved, or at least shared in Korea. We’re already running internships, graduate programs and a whole series of new direction that we haven’t done previously.

Los Santos Mine.

Where do you see Almonty in 10 years as a company as it relates to your core material focus? How central is ore economics to that?

In 10 years, we’ll still maintain our position as the best tungsten operational team outside of China, and one of the best in the world. Our focus is not going to move away from what we know, which is tungsten.

Over the next 10 years, we will solidify our position and our growth will continue to increase output out of Korea. We have 70-plus years of reserves and our grade is 3.5 times the average grade of a tungsten mine in a jurisdiction that’s not only supportive, but also a voracious consumer of what we produce.

We are going to stay with what we know – how to produce strategic metals such as tungsten to be cost competitive with China, who currently accounts for 80% of the world’s production of tungsten.

Can you talk about your current assets, and what is to come? Aside from your HQ presence, will you have more assets of any kind in North America in the short- or long-term future?

We currently have two sites in Spain and one in Portugal. Our Portugal site has been in operation for 126 years. One of our Spanish sites was closed earlier last year under emergency laws where the government closed all companies, so we made the decision that it would then be turned over to process tailings – a program that’s ongoing currently.

We look to replace our Los Santos, Spain, project with our Valtreixal project where we’ll transplant the plant that we have at Los Santos.

The South Korean Project Sangdong is very different. This is considered internationally, by our industry, the world’s largest with the highest grade and the largest reserves. It’s very much been coveted by many over the years, and we were very fortunate to acquire it in 2016.

There is growth potential in Korea that’s quite extraordinary as it has a vast tungsten deposit for more than 70 years. In terms of North America, 99% of our material goes to North America and we’re always on the lookout for more opportunities.

We are a Canadian company with a large U.S. shareholder block of about 49% and would like to identify a tungsten project within the United States that we felt could provide long-term supply solutions to many of our U.S. manufacturing consumers. We’re constantly on the lookout while fully understanding that these things take time.

We don’t expect, and even hope, that no loosening of environmental regulations come about because we believe those regulations are very important. Tungsten is a very scarce metal compared to the plenty of options for rare earths.

A lot of the tungsten assets in the United States ran out back in the 1950s, 1960s and early 1970s, but that’s not to say we’re not constantly reviewing all projects around the world – including being able to operate in the United States.