ANDY HOFFMAN
From Thursday's Globe and Mail
March 5, 2009 at 12:25 AM EST
TORONTO — Stephen Leahy doesn't want to take guns away – he just wants to make their bullets greener.
The chairman and chief executive officer of North American Tungsten Corp. Ltd. hopes demand for the metal his company produces will increase as tungsten's use as an environmentally friendly alternative to lead gains in popularity.
Tungsten can now be used as a non-toxic substitute for lead in fishing lures, wheel weights and protective X-ray vests.
But Mr. Leahy is most excited about the potential to use tungsten in bullets and buckshot.
"A ballistics company told me they think that lead will be banned in all shooting applications except the military in Europe in the next few years. They have to scramble to find an alternative and tungsten is the best alternative," Mr. Leahy said in an interview at the Prospectors and Developers Association of Canada (PDAC) conference this week.
While no longer used in paint or gasoline, lead is still used to make bullets and fishing lures because it is so heavy. The toxic lead from bullets and fishing lures can leach into water and soil.
Lead is poisonous and can, among other things, cause developmental defects in children.
Mr. Leahy is betting that the environmental damage lead can cause may prompt hunters and anglers to pay a little more for lead-free products.
"Some of these [issues] are starting to gain a lot of momentum, like lead shotgun shot, because of what it does to waterfowl. It kills them even if you don't shoot them."
Mr. Leahy's company produces about 4 per cent of the world's annual supply of tungsten at its Cantung mine in the western Northwest Territories, close to the Yukon border. The extremely dense metal has traditionally been used in steel hardening, in electronic applications and in light bulb filaments.
Until recently, tungsten wasn't seen as a viable alternative to lead because its lack of malleability made it so difficult to work with.
Scientists and researchers, including a company backed by North American Tungsten, have now developed tungsten composites that can be shaped for use in a myriad of applications.
Through a joint venture formed in 2006, North American Tungsten owns 43 per cent of Tundra Diversified Industries. The privately held Minnesota company has developed a process to coat tungsten particles in plastic and bind them together. The weighty composite can then replace lead in fishing weights, buckshot and protective X-ray blankets.
Mr. Leahy believes that new applications for tungsten will have a major impact on demand for the metal. Annual worldwide production is a relatively small 80,000 tonnes.
North American Tungsten is also developing the Mactung deposit, which is located about 160 kilometres north of Cantung. The new mine will be much larger than Cantung and is expected to cost more than $350-million to build. With North American Tungsten's current market value of just $17-million, that won't be easy and Mr. Leahy is hoping the metal's new role as a more environmentally friendly product will drive investor interest in the company.
From a peak of about $260 (U.S.) a tonne, tungsten prices have remained relatively strong at about $225 a tonne.
Mr. Leahy expects about 10 per cent of the firm's production this year will go to composite applications. He's hoping to increase that to two-thirds of production within five years.
To make his point, Mr. Leahy takes off his Swiss-made tungsten watch and slides it across the table. "I've seen more new products in tungsten in the past few years than I have seen in the last 16 years combined," he said.
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