The Tasmanian government has issued a $7.5 million loan to Group 6 Metals for its struggling Dolphin tungsten mine on King Island, reported ABC News. This dovetails the government recently acquiring 12% of the company’s shares after Group 6 couldn’t repay a previous loan.
A government spokesperson said the new loan was approved because the mine is “critical” for regional employment and economic activity.
“The $7.5 million loan was an important element of the business transformation plan that aims to deliver operational improvements to mining and processing activities to achieve profitability and growth, as the demand for tungsten continues to grow,” the spokesperson said, noting the loan comes from Tasmanian Development and Resources’ borrowing facility and does not require additional budget funding.
ABC News said the Tasmanian government approved a $10 million loan in 2021 to previous mine owner King Island Scheelite to restart operations at the mine, which had ceased in 1990 due to low tungsten prices.
Dolphin reopened last year but encountered financial difficulties.
Source: ABC News