To the chat box, and we'll address it during the Q&A at the end of the presentation. Presenting today is Tungsten Mining's Non-Executive Chair, Gary Lyons, who will take you through the key outcomes of the scoping study for the Mount Mulgine project. I'll now hand over to Gary to run through the presentation.
Thank you, Simon, and welcome. Good morning to everybody. Thanks for joining us today. As Simon alluded to, today's webinar is focused on the key outcomes from the Mount Mulgine scoping study, which was recently released to the market. I'm just having a problem moving the slides. Here we are. Just a little bit delayed. This is the usual disclaimer. There is absolutely nothing unusual about the contents of that disclaimer. Happy to get this deck to anybody that would like to have it emailed to them. Bit of a corporate snapshot. Tungsten Mining has a little over a million shares on issue. Last traded yesterday, closed at AUD 0.14. Market cap is a little under AUD 150 million. We have circa AUD 10.5 million in cash. Tungsten, why invest in tungsten? I'll take it that not too many have a great deal of knowledge of tungsten.
What we've seen of recent times is rocketing prices. Tungsten prices are at an all-time high. The chart in the bottom right-hand corner, you'll see the little balloon there that shows a number that's 689. That's $689 for a metric ton unit. That's 10 kg. You see the bottom left of that chart that the price was indeed around $200 back in 2020. What we've seen in the last four or five years is pricing that's disincentivized new operations by coming on stream. There's a deficit being created. The deficit's been created for a number of reasons. One has been that China controls around 80% of the supply of tungsten concentrate. Russia referred the 10%. Of course, it's common knowledge that China banned the export of tungsten concentrates back in February of this year.
We're seeing a number of mines that are experiencing depleted resources. The CAGR is forecast at 7.8% growth for tungsten by volume over the next eight years, anticipated to double by 2033. Current supply is around 90,000 tons per annum. I do not for one minute subscribe to the suggestion that demand will rise to 180,000 tons per annum. I do believe it will rise in excess of 100,000. What is so important is that the deepening supply deficit is unlikely to improve to any degree. We just do not see any new supply coming on stream. Forecast for 2026 is the Almonty deposit in South Korea is expected to come on stream next year. Apart from that, and there is no certainty that that will occur, apart from that, we see no new supply other than ourselves. We are probably the front runner.
In terms of usages for tungsten, the one that's always on top of the list for many people has been defense. It's only a small component of overall demand at 8%. Mining, construction, industrial, transport, and energy are other key users. In short, without tungsten, airplanes don't fly, motor vehicles don't move, and your partner's birthday present doesn't get delivered by Amazon. This is a chart that shows the main tungsten deposits outside of China. I'm pleased to say that Tungsten Mining sits right in the top two or three in terms of our assets. The largest one is a Canadian asset that is large in terms of its resource and also its grade. It's owned by Fireweed Metals. They are in development, but anticipated to be some five to seven years away from production.
I'll just highlight a couple of names that are on the list that you may be familiar with. Number eight is Núi Pháo, which is the Vietnamese mining operation and downstream producer of APT. Núi Pháo were indeed producing 9,500 tons per annum of tungsten concentrate. Their resources have been depleted. Their prediction for this coming 12 months is that that supply will drop to around 2,500 tons per annum. With Almonty’s Sangdong asset in South Korea predicted to run up to full capacity by year-end 2026, they're going to look to produce 4,000 tons. In short, it does not replace the deficit that's being created by Núi Pháo. Mount Carbine at 10, that's the EQ Resources asset up in Queensland. Then we have the two or three of Tungsten Mining assets that are listed there. Quite happy to take some questions and discuss this a little bit later.
In terms of our key asset, the jewel in our crown is Mount Mulgine, which is in Western Australia. We have three assets across Australia that make up our global resources. In Far North Queensland, the Watershed Project had a DFS completed on it back in 2014. It was done at a tungsten concentrate price of $400 a ton. Another asset in the Northern Territory, Hatches Creek, is an underground mine that we'll look to open cut. It was operated during the First and Second World War primarily for munition purposes. The jewel in our crown is Mount Mulgine. Mount Mulgine is located around 330 km north-northeast of Perth in Western Australia. It is a polymetallic deposit. It consists of two critical metals, which are tungsten and molybdenum. It has a number of base metals. We have copper, gold, and silver.
I'll run through the resource and the scale very shortly. In terms of our confidence in the resource, we've done a little over 110,000 meters of drilling. Throughout the process of the PFS and DFS, there is no requirement to do any further drilling. In terms of level of confidence, we have around 75% of our resource that sits in M&I. The location of Mount Mulgine is a Tier 1 mining jurisdiction. Our neighbors are the likes of Golden Grove, Rothesay, Volta, Karara, Mount Gibson, Worridah. Safe investment jurisdiction. It is a major resource. Mount Mulgine is currently one of the top three resources in the world by scale. It is globally significant. As you'll learn during the course of this presentation, we anticipate making some announcements very shortly in regards to further exploration targets for Mulgine.
Financial metrics that have evolved throughout the course of the scoping study and were recently announced. Firstly, the outputs for our preferred development case, which is for 6 million tons per annum of resource throughput. Strategic, it's long life, low cost, high value. It contains two critical metals. In terms of our strategy, our strategy is initial startup would be 6 million tons, but anticipating moving up to large scale of 15 million tons per annum. Polymetallic, as I mentioned. The scoping study in terms of the commodity prices, this was all done at well below spot prices. I'll share those with you. There is significant upside in terms of the commodity pricing. We did, in terms of the NPV, discounted 8% pre-tax. We did two numbers.
We've got what we term a conservative number, which is a AUD 1 billion NPV, and an aggressive number, which is AUD 1.4 billion, an NPV of AUD 1.4 billion. This is based upon the CapEx. If you drop down just two items there to CapEx, we've got a range. We've got a low cost of AUD 358 million and a high of AUD 495 million. The AUD 495 million is the conservative position, and the aggressive position is AUD 358 million. If we were to adopt today the spot prices as opposed to the discounted prices we use for the scoping study, the NPV would range from AUD 2.4 billion-AUD 2.8 billion. An IRR anywhere from 30%-71% at spot prices and taking an aggressive position. Operating costs ranging between AUD 25.40-AUD 30.80.
A total cash flow life of mine post-tax ranging between AUD 1.98 billion and AUD 2.56 billion, or annual cash flow of AUD 103 million-AUD 128 million. It shows an impressive payback between 2.2 and 3.8 years from commencement of production. Strip ratio is extremely low at 0.8. As I suggested, at the run rate of 6 million tons per annum, the resource I am talking about from one pit at Mount Mulgine will deliver us 23 years of operations. This is not the same slide. It is actually based upon a development case of 15 million tons per annum. Strategically, the same points. In terms of NPV, ranging from AUD 1.7 billion-AUD 2.3 billion at the base commodity prices and an IRR of 42%-62%. If we take spot prices of today, the NPV rises to between AUD 3.8 billion-AUD 4.4 billion, and the IRR from 69%-93%.
The CapEx increases to, well, an aggressive figure of AUD 631 million and a conservative number of AUD 868 million. OPEX falls, of course, due to the increased throughput ranging from AUD 21.60-AUD 26.20 per ton of ore processed. Cash flow post-tax, life of mine, AUD 2.14 billion-AUD 2.73 billion, an average annual cash flow of AUD 275 million-AUD 340 million. An impressive payback of between 1.6 and 2.2 years from commencement of production. Of course, strip ratio is the same. Mine life drops to 10 years based on this 15 million tons per annum of throughput. This slide shows our resource. The top part of the deck shows the resource attributed to Mount Mulgine. This is one pit. In indicated, we have 175 million tons and inferred 72 for a total of 247 million tons. This pit remains open, down deep, and also a depth remained in mineralization.
Overall, the asset of 247 million tons at 0.11% WO3 for 270,000 tons of tungsten concentrate. Molybdenum, some 69,000 tons. Gold, a little more than 1 million ounces. Silver, some 44 million ounces. Copper, 92,000 tons. Our global resource across the three assets is 328 million tons. The other resource providing 383,000 tons of tungsten concentrate. The other values do not move greatly. You can see the significant scale of our assets. In terms of annual production, we will produce 1,178 tons of molybdenum per annum, 1,300 tons of copper, a little over 4,500 tons of tungsten concentrate, 9,600 ounces of gold, and a little over 500,000 ounces of silver. Modeled over a 23-year mine life, the total ore we will process will be 136 million tons. Strip ratio I have mentioned, maximum pit depth will be 250 meters. Stage one is roughly 60 million tons.
Stage two is 90 million tons. Stage three will be the 136 million tons. All open pittable. All one pit. As I mentioned, we're looking to add a significant exploration target to this particular pit. Quite a simple flow sheet. Firstly, three-stage crushing, which will move into primary gravity concentration. Then into bulk sulfide flotation, where pyrites, copper, gold, silver, and moly move off to the north in this slide. The heavier items drop to the bottom and go through magnetic separation. A kicker for this is that we end up with a high-grade magnetite concentrate, magnetite iron ore concentrate. That drops down along with the tungsten. The tungsten then moves through a secondary gravity separation and then into scheelite flotation. We end up with three products.
Our product suite consists of a tungsten concentrate, a molybdenum concentrate, and then a base metals concentrate consisting of copper, gold, and silver. In terms of recoveries, we'll recover 72.5% of tungsten, 70% molybdenum, 41% of the gold, 47% of the silver, and some 62% of the copper. In terms of the site power, will be by gas-fired generation and renewable energy. There is potential for solar microgrid solutions too. It will be designed with consideration for expandability, particularly when considering the large-scale production. Water is a critical ingredient. We require between 2.4 and 3.6 gigaliters per annum at the 6 million ton processing rate. We anticipate deriving that from fractured rock and paleo channel systems. There is the opportunity for supply to be underpinned by regional basin systems. We are located due east of Geraldton, some 250 km, which is one of the major shipping ports.
When you consider that a 20-foot ocean FCL container has a value of just under AUD 3 million at today's prices, we'd anticipate shipping one a day to the port of Geraldton. No huge logistical problems. We're moving only small amounts of material, but of course, very high value. In terms of our workforce, where will it come from? The local township is Perenjori. There will be a small number of resources available from Perenjori in the immediate region. We'll have DIDO's (Drive-In Drive-Out) , from Geraldton and, of course, Fifo's from Perth. Mine infrastructure, nothing too interesting here. It's just a layer of our tenements and particularly where the pit is, the top left-hand corner there, the plant immediate to the south, and tailing storage facility, the TSF, further south. Then to the east is accommodation plant.
We do have the opportunity to leverage off existing infrastructure in the region, such as camps and airstrips, primarily during the construction phase. This is our cost profile. I won't dwell too much on this. The capital costs we've been through were, so the bottom of the first chart, 358-495, is what we used in that 6 million ton per annum model. Financial inputs just below that. Capitalized waste is probably one worth pointing out, which would occur in the first year only, which is 30%. The FX rate that we've used is 0.65. In terms of commodity prices, the bottom right-hand side there shows that the commodity price that we use for tungsten is $425 per MTU, molybdenum $23, gold $3,100, silver $38.50, and copper $4.60.
Of course, other than molybdenum and copper, the other three metals are significantly lower than current spot prices today. Considerable upside available when we look at those spot prices. This chart, this column chart here shows the conservative and aggressive case. The red components at the bottom part of those charts show that NPV, the baseline NPV, which is from AUD 1 billion-AUD 1.4 billion. The blue component on top of that, stacked on top of it, is the additional drive that comes from the spot prices. If you then look to the right-hand side, you'll see the spot prices. The tungsten one is now already out of date. As I mentioned earlier, it's $689 currently. Molybdenum $25.30, gold around that $4,100 an ounce, silver $48.70, and copper a little under $5.
If you combine them at the spot prices, we're looking at a conservative AUD 2.383 billion and an aggressive case of around AUD 2.8 billion. Significant value. This is another way of showing that combination. Indeed, the payback, the purpley area at the base is that base price NPV, and then the spot price stacked on top, which shows a combined number of around AUD 4.9 billion at spot prices. A payback ranging from 1.3-2.2 years. Very aggressive payback. Sensitivities. I think it's important to take a look at sensitivities. It is sensitive to currency fluctuation, tungsten recovery, and the tungsten price, and also to processing costs. What it isn't sensitive to is capital. You can see just how insensitive it is to movements in capital costs and also mining costs.
In terms of revenue, the pie chart on the left-hand side shows that 58% of our revenue will be derived from tungsten, 19% from molybdenum, and 23% from the base metals. Opportunities and to offer some upside potential. Resource growth. We will be looking to release an announcement either later this week or early next week, which is pitched at a significant exploration target down deep and forming part of the current pit expansion. The magnetite potential I raised during discussing the processing. There is an opportunity to optimize our flow sheet. There certainly is potential to optimize mining processes and streamlining of waste and ore movement. Infrastructure strategies. I have touched on those and the ability to leverage off existing infrastructure in the region. Commercially, exploring potential technical, financial, strategic partnerships.
We're fielding inquiries continually daily from potential off-take partners and also lobbying at both local, federal governments, as well as those in the U.S. In terms of timeline to first production, we released the scoping study only around 10 days ago. We achieved that in Q3 of 2025. The PFS has been fast-tracked, and we will deliver that to Q2 2026, at which point we'll move directly into the DFS. We're absolutely confident with the outcomes of the scoping study that we will push on. We aim to complete that in Q3 2027. FID will be completed Q4 of 2027. We've brought in a specialist group that are working with us who are assisting with that funding approach and ensuring that our PFS and DFS is covering absolutely every point associated and necessary to advance the FID. Engineering procurement and construction will commence Q1 2028.
We envisage pre-production mining to commence in Q3 of 2028 or at the end of Q3 2028. Production is targeted for Q3 2029. I have to say that we have incentivized our entire team to bring that forward wherever possible. We'd like to get to that point of production. Some of the key upcoming catalysts, a couple of milestones that we have achieved in recent times. We have delivered as promised, the scoping study results, and it's an exciting outcome from the scoping study. In Q4, we commenced the Mulgine and PFS, and we also listed on the OTCQB in the US following a number of inquiries from North American investors wanting easy access to TGN stock. We have appointed U.S. brokers, lobbyists, and advisors.
We're following that up with a visit to the U.S. at the end of next week for pretty much most of December, where we're doing roadshows right throughout the East Coast. Also, this quarter, as I mentioned, we'll release an announcement that relates to expansion of the resource exploration target. Then engaging with potential off-takes, strategic and technical partners. It actually has commenced, but certainly will become our focus in the first semester of 2026. Engaging with critical minerals offices, both in the U.S. and Australia, and exploring funding options. The completion of the Mount Mulgine and PFS, as I've reiterated, Q2 2026. Then a potential NASDAQ listing. We're encouraged by the U.S. investors to consider a NASDAQ listing. It's something that we're certainly advancing quite quickly. The DFS commencement Q3 next year, completion Q3 2027, then to the final investment decision.
This is potentially where I want to show the real value potential of Tungsten Mining stock. There are two names that are familiar to most that will be on this webinar. I have used two companies that are in production of tungsten. One is Almonty that is listed on the NASDAQ exchange and multiple other platforms. They have a current market cap of about $2.5 billion. They have reserves of some 51,500 tons of WO₃ tungsten concentrate. They have an EV ratio of AUD 55,789. I have also taken EQ Resources that have a little under 34,000 tons of tungsten concentrate in reserve. They have an EV of AUD 6,302 a ton. Tungsten Mining, a massive resource of 177,550 tons in reserve, and an EV of AUD 411. Not hard to see where the real value lies with Tungsten Mining.
Board, I won't dwell too much on the board, but a couple of faces there. Russell Clark has been on our board for some four years. Russell might be better known to some of you as the chairman of Volt. Tan Sri David Law has interest in steel production in Malaysia and significant property investments. Best remembered in Australia, particularly Western Australia, for the transaction of selling Midwest iron to Sinosteel for in excess of $1 billion some 16 years ago. That's me. Thanks for listening to me provide an update of the outcomes of our scoping study. It's a very exciting time in our journey. I thank you for your patience in listening to me. If you have any questions, I'd be delighted to answer them.
Thanks, Gary. Yeah, we'll just now open to questions. Please submit them through the chat box, and we will work through as many as we can in the time available. I did have a couple that came in via email beforehand, Gary, so I'll just shoot with those first.
Sure.
One of the big shifts in the updated scoping study is the significant reduction in upfront CapEx compared to the previous study. Can you expand on how you were able to achieve that and what drove the improvement?
Yeah. Look, for those of you that are not aware, Tungsten Mining, we conducted a PFS, which we released in January of 2021. So almost five years ago now. The CapEx was some AUD 670 million. And although it was only five years ago, that was a significant amount. It was at the time when tungsten prices were, you may recall from an earlier slide or a slide during the presentation, around $200 an MTU. The NPV was very small. I can't remember exactly what it was, but it was very small, and the IRR similarly. What we did was, after picking ourselves up off the canvas, it took us probably 12 months to do that. We looked at it through a totally different lens. We changed the executive. We changed the technical team, maintained our exploration team, done a fantastic job. We looked at it through a totally different lens. We looked at our three assets. We looked at the flow sheet, worked really hard in the metallurgical sense. We came up with a solution that has seen the CapEx sign fall significantly as a result of that. We are really encouraged by the financial outcomes from that scoping study.
Beautiful. Thanks, Gary. The next one, can you just give a brief update on the committee and approvals for the project?
Yeah. Look, the asset Mulgine sits on mining leases. There are certainly some updates to do in terms of environmental updates. We have, of course, consultants employed, but we have also got our own in-house team that are working on approvals. They are all advancing nicely.
All right. Excellent. Just on the decision to move ahead with an OTC listing, how do you actually see that benefiting Tungsten Mining?
Certainly, if you look at the geopolitical tension that is being created in terms of the critical minerals and metals space, there is certainly a void. We have got that deepening supply deficit. Mr. Trump has certainly placed tungsten very high in terms of his agenda. That has been pleasing for us because the tailwinds that has created are seeing us release the spinnaker and set sail. There are fundings coming out of the Department of War and Department of Energy for tungsten. We are seeing all tungsten mines that are only very small scale in North America that are being dusted off and repermitted, trying to get them into production. In terms of global significance, I really want to emphasize this, that our Mount Mulgine asset, this one pit, is capable of providing tungsten to the U.S., to the North American space, its entire annual demand or usage of tungsten. Mulgine can provide the U.S. with that. The U.S. is very important to us for a number of reasons, some that I have mentioned. I have to say that the U.S. investor has a deal more knowledge of tungsten than our Australian investor has. When noticing this, some of the presentations that we've been doing in the U.S., the knowledge of tungsten is very high. It is being spoken about very widely.
All right. That probably leads me pretty well into what looks like the last question here that's come through. Obviously, you just touched on the scale of Mulgine. Are you also seeing early interest from strategic and off-take partners?
Yeah. Look, there aren't too many weeks, Simon, where we're not speaking with off-take partners. We've had product samples we've provided to most of the leading groups around the world in Vietnam, Austria, and North America. Their testing proves that supports that our product is amenable to processing. Of course, where we've got this deepening supply deficit, people are desperate to get hold of significant supplies of tungsten. As I've emphasized, Tungsten Mining has assets of global significance. It's up to us now to get out and tell our story. That's exactly what we're doing. We're seeing some great movement in our share price that's risen from, it's doubled in the last six or eight weeks. That's very pleasing as we're spreading the word.
All right. Excellent. Thanks, Gary. Thanks, everyone again who joined us today. Thank you to Gary for the presentation. We appreciate your continued interest in Tungsten Mining and look forward to keeping you updated as Mount Mulgine progresses through the next phases of study.
Thank you.
Thanks.