US Department of War puts US$450M into a Nevada tungsten restart. VKA is planning one in the same state.

Disclosure: S3 Consortium Pty Ltd (the Company) and Associated Entities own 67,506,668 VKA Shares and the company’s staff own 1,700,000 VKA Shares at the time of publishing this article. The Company has been engaged by VKA to share our commentary on the progress of our Investment in VKA over time. This information is general in nature about a speculative investment and does not constitute personal advice. It does not consider your objectives, financial situation, or needs. Any forward-looking statements are uncertain and not a guaranteed outcome.

Over the last 90 days, all of this happened in tungsten markets:

• US President Trump banned tungsten scrap exports
• The UK government invested in a domestic tungsten project
• Zimbabwe banned tungsten exports...

Then BREAKING NEWS this week:

The US Department of War is investing US$150M into one of the USA’s largest historic tungsten mines...

(part of a broader US$2BN funding deal - US$450M of it being from the Department of War):

(source)(source)(source)

After pouring billions of dollars into rare earths (stuff for magnets used in fighter jets, robots and AI)...

...and creating a few billion dollar+ success stories out of rare earth ASX small caps)...

The US government’s attention is now on tungsten - possibly the most important military critical mineral.

Tungsten is used in armour-piercing ammunition, fighter jets, and the warheads of Tomahawk, Patriot and Precision Strike missiles.

Hopefully the US government attention is the starter for a re-rate in small cap tungsten stocks now.

Like our Investment, $22.6M capped Viking Mines (ASX:VKA) - whose project isn’t that far away from the one some of that DoW funding will go toward restarting:

(source)

We think that the DoW funding has now de-risked the entire tungsten industry inside Nevada - mainly because the funding will bring online a project that CURRENTLY does not have a big enough resource to meet the US$2BN stockpile contract.

Which tells us that the plant that gets built at that old mine COULD start looking for feedstock from other projects in Nevada.

(Maybe projects like VKA’s...)

But wait why tungsten and why now?

Remember all those bits of news on munitions stockpiles running low and the US generals saying the US can't afford to be in a prolonged conflict with Iran?

(source)(source)(source)

Turns out you need tungsten to rebuild those munitions stockpiles.

Right now the US produces zero tungsten domestically and on January 1st 2027, a ban on foreign imports of critical minerals for US Military use is coming into effect (source).

PLUS there is now a Trump signed Executive Order pushing the US military industrial complex to source critical minerals from inside the US or risk losing their defence contracts...

(Read the full Executive Order here)

So there will need to be a massive push into US tungsten names across the next 3-6 months MINIMUM... (probably more like a few years given the time it takes to get supply online).

What happened yesterday (with the DoW tungsten deal) actually reminds us a little bit of the DoW deal with US rare earths stock MP Materials.

That kickstarted a wave of capital going into other rare earth names - and turned a few small cap ASX stocks into billion dollar+ companies.

Now we think it's time for the tungsten names to see some capital love.

Hopefully finding its way to VKA at some point.

VKA's tungsten project (like the one that received DoW funding) is also in Nevada, USA.

And its ~275km drive from the brand-new US$12BN US critical minerals stockpile at the Hawthorne Army Depot in Nevada.

Yes, that very same depot the US is now using to stockpile critical minerals like tungsten - here is that map again showing where VKA’s project is:

(source)

VKA's project has a history of tungsten production dating back to the 1950s, when ~123,000 tonnes of ore was mined at an average grade of ~0.54% tungsten. (source)

And right now VKA is a few months into the project's first ever drill program in ~40+ years.

The first batch of results are already back in and looking good. (more on these later)

Concurrent with the drilling, VKA is also working toward a rapid restart of production.

VKA has completed an independent processing study for its project using a modular plant design that could be in production within three months of on-site assembly (source).

So VKA is already thinking deeply about production (long before completing its first drill program).

Take a look at the conceptual processing plant design:

(Source)

The biggest kicker for us after yesterday’s DoW deal is that the asset being funded isn't giant in size...

It only has a resource of 2.1Mt at 0.5% tungsten (source), BUT it was historically one of the largest tungsten mines in the United States.

So really, it's a small existing resource that was producing in the past - where the US government can see a pathway to bringing supply back online.

An almost identical setup to VKA and a big part of why we Invested:

• VKA’s asset produced in the past
  
• VKA has a rapid-restart plan
  
• VKA has drill results, showing there is mineralisation beneath the old workings...

VKA is currently drilling the project and so over the next few weeks/months we will also know if a historically PRODUCING tungsten asset, inside the USA has size/scale...

...enough to be brought back into production.

How does VKA’s project compare to some of the other projects in the USA?

One of the biggest known tungsten deposits in the USA is owned by ~$600M Guardian Metal Resources.

Back in July 2025 Guardian Metal received a US$6.2M grant from the US Department of Defense. (source)

Guardian’s deposit averages a ~0.178% grade, and recently put out a Pre-Feasibility Study showing a post tax NPV of up to ~US$1.4BN. (source).

As we saw with the DoW deal yesterday - VKA’s project doesn’t need to be massive.

The project the DoW backed only had a resource of 2.1Mt at 0.5% tungsten (source).

And Guardian Metal’s project which produced that US$1.4BN NPV number is only based on a ~10Mt resource.

Guardian Metal’s resource has also taken it to a ~A$1.1BN market cap - up almost 5,000% from its June 2023 low to the high in April this year:

(source)

The past performance is not and should not be taken as an indication of future performance. Caution should be exercised in assessing past performance. This product, like all other financial products, is subject to market forces and unpredictable events that may adversely affect future performance.

The most interesting part is that almost all of Guardian’s share price appreciation was driven largely by three key drivers.

1. Guardian received US$6.2M from the US Department of Defence in July 2025.
2. Then it completed a technical study in December (incorporating drilling data from 68 old holes).
3. Then Guardian completed a US listing raising ~US$60M.

We think VKA is in a similar position to where Guardian was a few years ago.

Remember Guardian back in December 2023 was only capped at ~$12M.

After the current round of drilling, VKA could be in a position to present a more comprehensive re-start plan.

All we need to see is a few million tonnes at that ~0.2-0.5% grade and it could be game on for VKA...

VKA is executing our US critical minerals playbook

A big part of our US critical minerals Investment thesis is:

• Public and private capital will mobilise and look for critical minerals projects to back, and
• The companies who have the right assets, with the right combination of US exposure will be the ones to attract that capital.

We put out Our “playbook for small ASX stocks advancing US critical minerals projects - which is what we think ASX small caps need to do to put themselves in the best possible position to attract that capital.

The more of the boxes in our list a US critical minerals stock can tick (and quickly), the better (we think) they can position themselves to capture US capital and attention.

Here is everything VKA has done on that list:

• ✅ Own or acquire a US based critical minerals project
• ⬜ Appoint Washington lobbyist
• ✅ Spend time in USA or appoint US based operations person
• ⬜ Appoint experienced, big name advisors or board members.
• ✅ List on the US OTC market (Trading as VKALF from 14 Apr 2026)
• ⬜ Commence NASDAQ or NYSE listing process
• ✅ Acquire, license or partner with downstream processing technology.
• ✅ Deliver early metwork and processing of bulk samples ahead of drilling
• 🔄 Prove samples can be processed, deliver downstream product. (lab scale only, approval received for ~900t bulk sample to be processed by a US toll treater)
• 🔄 Secure US government funding. (DIBC application underway)
• ✅ Attract interest from US investors (American Tungsten Corp put in $750k)
• ✅ Outline plan for small, cheap and fast mine (Conceptual plant design released 30 Jul 2026, 300ktpa modular "Rapid Start" gravity circuit)
• 🔄 Deliver drilling success on project (First assay 14m at 0.56% tungsten, 15 more holes completed)
• ⬜ Use larger market cap to bolt on later stage or advanced US projects.
• ⬜ List on major US exchange
• ⬜ US investor roadshows
• ⬜ Deliver domestic US critical minerals supply

Luckily VKA’s been going pretty hard and fast on its project for over 9 months now.

So IF capital starts to look for a home in other US tungsten names - VKA could end up being one of the few names that has developed a story big enough for funding.

We have already seen VKA attract investment from ~$140M American Tungsten (who own ~6% of the stock).

And American Tungsten’s CEO Ali Haji has gone public talking about potential for consolidation + M&A:

"So the Viking investment was one that was made given, when we looked at our ability to mill as opposed to the DSO model, we started to look at additional assets to make sure that Patterson, Idaho, which is where our asset is, starts to become a processing hub for Tungsten.”

"So there is a cash investment there that ultimately has now more than doubled since we made that investment or have committed to the investment. And the intent here is, you know, it could end up being part of a roll-up strategy for us in the future, but it's nice to get in at the early, at this early entry point."

"I think we will start to see larger organisations that are perhaps not entirely tungsten-focused start to take aim at tungsten assets. So I think the space is only just starting to heat up."

Here is that video of him which in the Q&A section goes over their Investment into VKA and how the tungsten sector had begun to heat up (back then):

(source)

Maybe the same reasons American Tungsten were interested in VKA - could also be a reason for the DoW backed project also becoming interested...

Just taking a look at the Nevada map of tungsten projects, none of those are MASSIVE in their own right - so there could be some regional consolidation opportunity here too...

(source)

Who knows what happens in the long run - in the short term though, we think the projects with a realistic pathway to production will attract the most funding.

Which brings us to VKA’s current drill program...

VKA is currently drilling its project

When we first Invested in VKA back in December, the project had a history of tungsten mining and just a few modern sample results.

Since then, VKA has 8x'ed the exploration upside, by growing the known strike from ~800m to ~7km by:

1. Acquiring a historical exploration database.
2. Digitising the old drilling data
3. Digitising the project's geological model.
4. Doing more sampling and mapping.
5. Completing geophysical surveys.
6. Pulling all of that data into a 3D geological model to identify the highest-priority drill targets.

VKA turned old pieces of paper like this into a modern, drill-ready 3D model and target set:

(source)(source)(source)(source)

And now, VKA is drilling on the edges of the previous tungsten mining done on the project.

VKA’s theory is that the entire edge of that magnetic anomaly could host tungsten mineralisation (~7km total perimeter).

The main thing we want to see is mineralisation all across that perimeter:

(source)(source)

So far so good from VKA’s first hole:

(source)

Next from the drilling we want to see VKA extend the mineralisation across the perimeter of that magnetic anomaly.

And eventually incorporate its drilling data into its rapid restart strategy which is a big part of our VKA Big Bet as follows:

Our VKA Big Bet:

“VKA re-rates to $100M+ market cap with a fast to market tungsten production and downstream strategy, as well as continued interest and capital flows into the USA critical metals thematic”

NOTE: our “Big Bet” is what we HOPE the ultimate success scenario looks like for this particular Investment over the long term (3+ years). There is no guarantee that our Big Bet will ever come true. There is a lot of work to be done, many risks involved, including development risk, country risk and commodity price risk - just some of which we list in our VKA Investment Memo.

Success will require a significant amount of luck. Past performance is not an indicator of future performance.

What's next for VKA?

🔄 VKA’s first drill programme at US tungsten project

Here are the milestones we are tracking for the drill programme:

• ✅ Earthworks
• ✅ Drill rig mobilisation to site
• ✅ Drilling starts - (visuals in August)
• 🔄 Assay results (first assay received, 15 holes completed as of 10th September)

🔄 VKA’s rapid restart plan

We also want to see VKA progress its rapid mine restart strategy.

Here are the milestones we are tracking on that front:

• ✅ Assay results from stockpiles + tailings dam
• ✅ Processing study results
• 🔄 Metwork optimisation (Ore sorting + flotation testwork).

🔄 US engagement

This is more of a corporate milestone we want to see VKA hit.

It’s hard to predict when any of these might happen, but we are hoping VKA can attract some sort of US government funding to help finance its project AND/OR attract strategic interest from inside the US.

What could go wrong?

In the short term, the key risks will be from when VKA starts drilling its project.

Exploration risk

There is no guarantee that VKA's upcoming drill programmes will be successful. VKA may fail to find economic deposits of tungsten in which case we would expect the share price to re-rate lower.

Source: “What could go wrong” - VKA Investment Memo 16 December 2025

Other risks

Like any early-stage exploration company, VKA carries significant risk, here we aim to identify a few more risks.

While VKA is actively pursuing US government grants, there is no guarantee this funding will be awarded or arrive on time. Given its small market capitalisation, any future capital raises needed to finance drilling and mine setup would lead to shareholder dilution.

VKA’s rapid-restart strategy depends heavily on preliminary processing studies and modular plant designs. Scaling up metallurgical processing in real-world conditions always carries technical risks, potential recovery rate shortfalls, and budget overruns.

Securing permits, water rights, and site clearances in Nevada can also introduce unforeseen delays. Navigating local regulatory frameworks and environmental approvals could push back project restart timelines.

Much of the current market momentum relies on US defense procurement laws and foreign import bans on tungsten. Any changes to political policy, tariffs, or a sharp drop in global tungsten prices could reduce commercial interest and impact project economics.

Investors should consider these risks carefully and seek professional advice tailored to their personal circumstances before investing.

Our VKA Investment Memo

You can read our VKA Investment Memo in the link below.

We use this memo to track the progress of all our Investments over time.

Our VKA Investment Memo covers:

• What does VKA do?
• The macro theme for VKA
• Our VKA Big Bet
• What we want to see VKA achieve
• Why we are Invested in VKA
• The key risks to our Investment Thesis
• Our Investment Plan