The government's National Wealth Fund is set to put £71m into mining firm Tungsten West to help reopen the Hemerdon mine in Devon. The funding package includes a £36m share purchase that gives the government a 7.4 per cent stake in Tungsten and a seat on the board, plus a £25m loan facility.
The project is expected to give a significant boost to the local economy across the West of England, creating 350 direct jobs. Beyond the financial investment, the government will secure the option to buy up to half of the mine's future tungsten output.
John Healey, the Chancellor, said: "This investment will supply vital minerals to British defence, energy and aerospace businesses – and keep good, well-paid jobs in the UK."
Tungsten West, based in Plympton, Devon, focuses on mining and extracting tungsten, tin and secondary aggregates, which are by-products of other industrial processes. "It is extremely important to us that we prioritise UK requirements for this critical metal to support domestic demand, including strategic initiatives across defence and next generation energy," Jeff Court, chief executive of Tungsten West said.
The Hemerdon Mine, which formerly functioned as Drakelands Mine, ceased operations in October 2018 following the liquidation of its previous operator, Australian company Wolf Minerals. Tungsten West bought the site in 2019 and has spent years reconfiguring the processing layout and securing new environmental permits, reports City AM.
The new funding will help the company rebuild and enhance processing equipment on-site, cover ongoing project costs, and pay for the labour and operations needed to reach full metal production. The London-listed company confirmed the UK government's shareholding would be officially listed on the stock market on 27 August, with mining activities resuming in the third quarter.
The announcement comes a month after Tungsten West said it was preparing to "ramp up" work at the site ahead of the mine's 2027 opening. It is the latest use of the National Wealth Fund to push the government's agenda in areas such as defence and energy.
During Rachel Reeves' tenure as Chancellor, the policy bank announced a £599m financing package for Rolls-Royce Small Modular Reactors (SMR) to accelerate delivery on its project with Great British Energy. The capital injection from the taxpayer-backed wealth fund is intended to de-risk the project for private lenders, using public money to "crowd in" billions in additional investment from the City and international markets. Approximately a thousand jobs are expected to be generated at Rolls-Royce SMR, which is jointly owned by the FTSE 100 giant and Czech power company CEZ, through the funding.
Government Invests £71m to Reopen Devon’s Hemerdon Mine