Blue Moon funds Nussir copper project in Norway, bets more on Springer in Nevada

Blue Moon Metals (TSXV: MOON; NASDAQ: BMM) this week approved building its $184-million (C$252 million) capex Nussir copper-gold-silver mine in northern Norway and moved toward restarting the Springer tungsten mine in Nevada.

Paired with a C$150-million equity raise to fund construction, the decision on Monday seeks to shift the company from developer to builder. It locks in a 13-year mine plan for Nussir, a 6,000-tonne-ore-per-day underground mine about 1,400 km north of Oslo. First production is targeted for the third quarter of 2027.

The construction capital is also to come from cash, undrawn funds from its $140-million project package. Blue Moon’s bigger project bets sit in the U.S., where Springer in Nevada, Blue Moon in California and Apex in Utah could form a western supply chain for tungsten, gallium and germanium rather than leave the company reliant on one Norwegian copper mine.

Supply chains

Western governments and industry are scrambling to cut reliance on China and other rival suppliers for critical minerals. Blue Moon says China, Russia and North Korea account for 87% of tungsten output, China produces about 95% of gallium and China supplies roughly 75% of germanium.

Tungsten prices have jumped to $3,000 in seven months from $500 per tonne, Blue Moon said. Springer could return to production by the fourth quarter of 2027 after about $50 million of restart spending. Internal modelling points to 107,000 to 124,000 tonnes in concentrate, which it says could make Springer the only major tungsten producer in North America.

Blue Moon wants a foothold in a market still dominated by China at both the mining and processing stages. “Western economies remain heavily import-dependent and often rely on Chinese-processed material even where ore is mined domestically,” Canaccord Genuity analyst William Jones wrote in an April 15 tungsten industry report. Jones said the supply chain remains tightly concentrated and forecast structural deficits through 2030.

Advanced copper

Nussir gives the company’s overarching development strategy its first real cash engine. A feasibility study issued this month shows the project hosts 28.72 million measured and indicated tonnes grading 1.02% copper, 0.12 grams gold per tonne and 12.3 grams silver, for an average 1.2% copper-equivalent grade, according to the feasibility study.

The project has an after-tax net present value of $235 million at an 8% discount rate, with an internal rate of return of 19%, the study shows. The base-case scenario includes long-term price assumptions of $4.78 per lb. copper, $3,515 per oz. gold and $45.26 per oz. silver.

The total payable metal mix breaks down as 77% copper, 6% gold and 13% silver.

Blue Moon targets about 19,000 tonnes of mainly copper in concentrate a year from the second half of 2027.

The mine could generate average annual free cash flow of $77 million at consensus prices and $125 million at spot, the company estimated.

The project comes with infrastructure many new mines lack. Blue Moon will process ore at the brownfield Øyen industrial site, use existing 132-kV power tied to a renewable grid and ship through an ice-free port. The mine already has its operating licence, tailings permit and zoning plan.

Critical metals

Blue Moon bought the Nevada-based Springer asset in February and wants to fast-track a restart of the past-producing tungsten mine, mill and ammonium paratungstate circuit for value-added tungsten production.

The Springer restart decision was made without a current feasibility study and without current mineral reserves showing economic and technical viability. Blue Moon added that Springer’s 2012 resource estimate is historical and should not be relied upon as current. The same warning hangs over the even earlier-stage Apex deposit.

Springer carries a historical indicated resource of 322,050 tonnes grading 0.537% tungsten trioxide and 1.75 million tonnes inferred at 0.493%.