Deccan Gold Mines shares hit 20% upper circuit as firm plans to buy tungsten project in Spain

Deccan Gold Mines

The shares of Deccan Gold Mines jumped nearly 20 percent after the company announced plans to invest in a tungsten project in Spain.

The shares of the company hit the upper circuit at Rs 106.35 apiece on Tuesday.

Deccan Gold Mines proposes to acquire up to 75% stake in 'Logrosan':

Deccan Gold Mines on December 23 proposed to acquire up to 75 percent stake in the project prior to production. Logrosan is an early-stage exploration project but has opportunity to convert discovered mineralisation to mineral resources within one-two years, the company said.

The Logrosan project lies within a highly mineralised region of Spain, which is known for tungsten, tin, rare earth elements and gold occurrences, the company said, adding that early exploration and limited drilling results have shown encouraging tungsten mineralisation, including intersections such “as 3m @ 0.42% WO₃ and 8m @ 0.32% WO₃, and isolated high-grade gold results such as 1m @ 96.2 g/t gold”.

Spain has long been recognised as a favourable mining destination due to rich mineral endowment in critical minerals, supportive permitting and ownership structure, competitive operating costs, proximity to European industrial markets and absence of production-based royalties.

"Tungsten is a globally recognised critical mineral due to its strategic use in defence, aerospace, high temperature alloys, industrial cutting tools, and electronics. Global supply continues to be constrained, with China accounting for over 80% of worldwide production, increasing the relevance of non-China sources," Deccan Gold Mines said.

The company said that its technical experience in gold exploration, drilling and resource evaluation is directly transferable to tungsten deposits, given similarities in geological exploration and mineralisation models.

Here's what company's management says:

"Our evaluation of the Logrosan Tungsten Project reflects Deccan Gold’s broader vision of expanding India’s presence in strategically important minerals that power tomorrow’s industries. Tungsten is a globally critical resource, and Spain offers a mining environment backed by geology, infrastructure, and proximity to European demand. Our experience in gold exploration positions us to assess and develop tungsten systems with confidence and technical depth," said Hanuma Prasad Modali, Managing Director, Deccan Gold Mines.

"As India accelerates its critical minerals strategy, Deccan Gold is methodically exploring opportunities that strengthen our global footprint, reduce supplychain vulnerabilities, and enable India to participate meaningfully in materials that are vital for advanced manufacturing, defence, and sustainability," the company's executive added.

Deccan Gold Mines share price history:

Deccan Gold Mines shares have risen around 14 percent in the past five days, but fell more than 6 percent in the past one month. The stock has dropped nearly 16 percent in the past six months.

The comes after the shares gained more than 530 percent in the past five years.