How Did Group 6 Metals Achieve a 51% Surge in Tungsten Production?

Record Production and Operational Momentum

Group 6 Metals Limited (ASX – G6M) has reported a landmark quarter at its Dolphin Tungsten Mine on King Island, Tasmania, producing 26,175 metric ton units (MTUs) of tungsten trioxide (WO3). This output marks a 51% increase from the previous quarter and establishes the company as a significant player in the global tungsten concentrate market. The surge in production was driven by improved processing plant performance, which handled 70,004 tonnes of ore, a record throughput since operations began.

Operational enhancements included reduced unplanned downtime and completion of critical plant upgrades, enabling a more consistent and efficient processing flow. The average feed grade remained steady at 0.65%, reflecting the quality of the ore stockpiles being processed.

Financial Strength and Debt Reduction

On the financial front, Group 6 Metals achieved record sales of 27,007 MTUs, translating into AU$17.55 million in revenue and AU$16 million in cash receipts, nearly doubling the previous quarter’s figures. The company generated AU$1.5 million in operating cash flow and recorded net cash inflows of AU$1.3 million.

Significantly, the company reduced its total debt from AU$34.1 million to AU$24.2 million following the exercise of 28.3 million warrants by members of its Senior Lending Group. This conversion not only eased the debt burden but also improved the balance sheet, with a closing cash balance of AU$3.5 million and additional debt facilities of AU$2.5 million available.

Strategic Transition to Underground Mining

Preparations for transitioning from open cut to underground mining are well underway. Development works in the pit and haulage roadways, flood water management, and tailings storage facility extensions have been progressing. During the quarter, incidental remnant ore totaling 15,765 tonnes was recovered as part of these activities.

The company currently holds approximately 477,000 tonnes of ore stockpiles at an average grade of 0.38% WO3, equating to around 182,000 MTUs of contained metal. These stockpiles are expected to sustain processing operations through at least mid-2026, providing a solid cash flow foundation as underground mining infrastructure is developed.

Market Tailwinds and Outlook

The tungsten market remains robust, with Ammonium Paratungstate (APT) prices rising sharply from around US$335 to US$1,000 per MTU over the past year. This price surge is underpinned by growing demand from defence, aerospace, electric vehicles, and electronics sectors, alongside supply constraints due to Chinese production quotas and limited Western sources.

Group 6 Metals’ Executive Chairman Kevin Pallas highlighted the company’s strong operational and financial progress, noting the team’s efforts in plant optimisation and the promising outlook as underground mining commences. He also pointed to the supportive geopolitical environment, including the recent US-Australia framework aimed at securing critical mineral supply chains.

With a strengthened balance sheet, record production momentum, and a buoyant tungsten market, Group 6 Metals is well positioned for continued growth and anticipates reinstatement on the ASX in the near future.