Energy Transition Minerals gains ground as critical mineral force in Europe

• Energy Transition Minerals named as successful bidder for the Penouta mine in Spain which, following completion, will add to ETM’s growing European portfolio
• Penouta is the only developed tin-tantalum-niobium project in the European Union
• It adds a key dimension to sourcing conflict-free critical minerals on the European continent

Special Report: Energy Transition Minerals has positioned itself as a key player in Europe’s quest for critical minerals independence, being named as the successful bidder for the continent’s sole tin-tantalum-niobium mine as geopolitical tensions shake up traditional supply chains.

The company’s proposed €5.2 million acquisition of Spain’s Penouta mine, combined with its Tier-1 Kvanefjeld project in Greenland, will create a unique portfolio aligned with the EU’s Critical Raw Materials Act and its goal to move away from China’s stronghold on critical minerals.

China holds substantial, and in some areas near-monopolistic, control over the global critical mineral supply chain, particularly in processing and refining, with roughly 70% of global refining for key minerals.

For certain materials, their dominance is even greater, such as 90% of rare earths processing capacity and a near 100% control over heavy rare earth processing.

Against this backdrop, Energy Transition Minerals (ASX:ETM) is stepping up as Europe faces mounting pressure to secure alternative sources that are essential to renewable energy, defence technology and semiconductor sectors.

Over the past few years, the EU has been addressing these challenges head on with the establishment of the European Raw Materials Alliance in 2020, which brings together a wide range of stakeholders to address its dependency and counteract it by attracting investments, training young talents and fostering innovation.

Three years later, the Critical Raw Materials Act (CRMA) was introduced, setting clear 2030 targets to extract 10% of its annual needs, process 40% within the EU and recycle 25% of its annual needs domestically.

Now with two production-ready assets in hand, Managing Director Daniel Mamadou said the company is tapping into Europe’s growing need for secure, homegrown supply chains.

Penouta acquisition progressed as ETM expands beyond Greenland

“That’s been our focus at our flagship Kvanefjeld asset in Greenland, but we’ve always been very clear that we wanted to add one or more strings to our bow,” he told Stockhead.

“In 2022 we made some baby steps in Spain with the JV project – we own a subsidiary in Spain and that gave us the opportunity as a company to familiarise ourselves with the country, the authorities and the process.

“The Penouta asset that we’re acquiring (subject to the satisfaction of various outstanding conditions) was put into an insolvency process, but we recognised its deep value early on because a lot of capital had been spent on it given it was previously in production.

“Shortly after starting the exploitation permit the mine was put on hold due to a complaint by a Spanish environmental group, which gave us the chance to put in a bid that was significantly lower than the replacement cost of the asset.”

The company’s successful bid for Penouta represents a major value play, given the nearly A$50 million sunk into the site since 2012 by previous owners Strategic Minerals.

Having existing infrastructure like a 2Mtpa crushing-grinding-gravity separation processing plant tailored to its polymetallic ore only adds to the asset’s appeal even before the value of the tailings and new mining areas have been realised.

Rich history poised for new chapter

Although the site was last active in 2024, Penouta boasts a rich production history, dating back to Roman times for both metals and industrial minerals.

In a modern context, the Penouta tin–tantalum–niobium deposit was first developed in the early 1900s which saw intermittent production through to the mid-20th century.

The most significant of these phases was made by industrial conglomerate RUMASA from the 1970s to 1983 when significant quantities of tin concentrate were delivered to European smelters, utilising conventional open-pit methods and gravity processing circuits.

Declining tin prices and operational challenges led to a suspension of primary extraction, leaving behind well-maintained infrastructure and a thoroughly characterised resource base.

It also features tailings storage facilities and some utility connection with existing roads providing efficient access to the Port of Vigo, about 230km away, and rail links support bulk concentrate transport to European and international markets.

Locals rally behind Penouta as mine moves toward restart

At its peak, Mamadou said the mine was feeding around 154 families from the surrounding villages in the province of Ourense within the municipality of Viana do Bolo in Galicia.

“Even at a societal level, it is a significant venture,” he said.

“There have been demonstrations in the past but interestingly, these demonstrations have been made by the families of workers at the mine who lost their jobs due to the suspension of the mining licence.

“So, a very different situation where demonstrations are taking place by people in favour of it,” he said.

“It’s an advanced, shovel-ready brownfield asset and our focus on its now is going to be putting it back into production.”

Post completion of the acquisition, the company will focus on conducting a reassessment of the overall operation with a strong focus on the re-compliance required to regain the Section C concession.

“In Spain, permits are named either A, B, or C – B is a permit to process tailings while C is a mining permit, so the Section B permit is in good standing, but we are really interested by the Section C mining permit,” he said.

“And we’re putting a timeline of roughly nine to 12 months post completion to get that done which will enable full-scale production.”

Well-capitalised for future endeavours

With roughly $34m in the war chest — thanks to a placement, share purchase plan, and past efforts — Energy Transition Minerals has the firepower to chase down its mining licence and plug any shortfalls.

Its secondary focus remains on Kvanefjeld where the company plans to increase its presence.

“We’ve applied for additional grounds but we’re also looking at other interesting areas in Greenland – the country is blessed with a lot of mineral wealth, and we’re explorers, we so we’re hoping to see what else can be done there.”

This article was developed in collaboration with Energy Transition Minerals, a Stockhead advertiser at the time of publishing.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.