Even though the forecast wasn’t good, there was a great turnout. The fish have been still going pretty good. We had a great weekend on Gull Lake with walleyes in 20-28 feet of water on shiners. The crappies haven’t been so cooperative yet. We did get some nice pike also.

Mille Lacs Lake is still producing big fish, doesn’t seem to matter where, everyone is doing good. There is still a good walleye bite on North Long and Round lakes. Rice Lake and South Long Lake have definitely slowed for a while. Sylvan Lake has started to put out some nice crappies and sunfish. Some of the other lakes like Cullen, Roy and Mission have also been putting out some panfish.

Ice fishing - When the panfish start to get finicky, try something new like a tungsten jig and a straightline reel, so your lure doesn’t spin. The fish really seem to like that. And with the heavy tungsten jig there is no need for a split shot, which will also improve your odds.

Tungsten Manufacturer & Supplier: Chinatungsten Online - http://www.chinatungsten.com
Tel.: 86 592 5129696; Fax: 86 592 5129797
Email: sales@chinatungsten.com
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The developments occurred on Tuesday, January 22 that show the continuing strength of the market for offshore drilling rigs, particularly in the ultra-deepwater sector. I have discussed this strength a few times over the past month, most notably here.

The developments is an announcement by Vantage Drilling (VTG) that it has received a conditional letter of award for its newbuild drillship Tungsten Explorer. This two-year contract will commence in mid-2014 and end in mid-2016. The customer will also have four options to extend the contract for a period of six months per option. Thus, the rig would be under contract from mid-2014 until mid-2018 if all four of these options are exercised.

The Tungsten Explorer is a 2013-built ultra-deepwater drillship that is capable of drilling wells up to 40,000 feet deep in up to 12,000 feet of water. This makes the rig one of the most capable ultra-deepwater drillships in the world today.

Vantage Drilling stated that it expects total revenue from this contract to be approximately $468 million, including the mobilization fee. This works out to approximately $641,000 per day but, once again, that includes the mobilization fee. Therefore, the rig's dayrate is not $641,000. Vantage Drilling did not state what the mobilization fee actually is so we cannot calculate the actual contractual dayrate. However, based upon mobilization fees for similar contracts, we can assume that the contractual dayrate is around $600,000, the midrange of a span of possible dayrates that extends from the upper $500s to $620,000. The biggest factor here is whether or not there are any customer-requested modifications to the rig. If there are no such modifications then the dayrate will likely be at the high end of this range, around $620,000 per day or so. The company will amortize its mobilization fee over the life of the contract so ultimately Vantage Drilling will realize revenues of $641,000 per day over the two- year contract term. However, it is important for investors to realize that the mobilization fee is only intended to reimburse Vantage for the costs that it incurs in getting the rig into position and ready for its assignment. The dayrate is where the contractor really makes its profit and so it would be nice to have a definite value for this.

This contract does not begin until mid-2014, however the rig will be delivered this year, in 2013. That leaves a period of time where the rig will be idled without a contract. This means that the rig will generate no revenues and Vantage Drilling's revenues and profits will be lower than if the rig were operational during this time. Vantage Drilling addressed this in its contract announcement and stated that the company would try to secure additional work for the rig sooner, to avoid idling. According to Paul A. Bragg, Chairman and CEO of Vantage Drilling,

    "The announced project is an attractive cornerstone for us. Since the Tungsten Explorer is scheduled for delivery in May 2013, we expect to obtain additional work for the unit to commence upon delivery from the shipyard. We are currently discussing drilling requirements for the second half of 2013 and early 2014 with both affiliates of the counterparty to this contract as well as several other customers. We expect that we will conclude another contract, thereby increasing Tungsten's contracted backlog, inclusive of options, to be approximately five years from commencement."

Given the current state of the market, Vantage is unlikely to have much difficulty finding near-term work for the Tungsten Explorer, although most oil companies prefer long-term contracts in the current environment and the current contract precludes that possibility. However, short-term contracts also carry much higher dayrates than long-term ones so Vantage would benefit from the higher dayrate should it secure such a contract. Mr. Bragg's statement that the company is already in talks to secure a contract for the second half of this year and early next year do provide optimism regarding the company's changes of securing an additional contract.

Tungsten Manufacturer & Supplier: Chinatungsten Online - http://www.chinatungsten.com
Tel.: 86 592 5129696; Fax: 86 592 5129797
Email: sales@chinatungsten.com
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Shares in W Resources (WRES) jumped 10% on news that its La Parrilla tailings project in south-west Spain had been granted approval by the mining department of the Junta de Extremadura, the regional authority.

The La Parrilla tailings project is expected to produce in the second half of 2013, with annual plant feed in the region of 330,000 tonnes and annual production anticipated to be 28,000 metric tonne units (MTU) of tungsten and 26 tonnes of tin, which at the current prices for the metals should deliver approximately €7 million (£6 million) per annum in revenue.

Construction of a processing plant located to the south-east of the La Parrilla site will commence in the first quarter. The capital cost of this plant is estimated at €1.3 million, for which the board is currently evaluating financing options. The company has already received one indicative offer for financing the La Parrilla tailings, which is currently under evaluation.

"This is an important milestone for W, as the La Parrilla tailings project is on course to deliver tungsten production within two years of the company acting on its new strategic direction,” commented chairman Michael Masterman.

Interactive Investor view

Shares in the company have doubled over the past year and are currently trading at around 0.6p.

The fundamentals are strong - the project comprises a tungsten mine and tungsten tailings project. The historic mine resource estimated in 2008 was 36 million tonnes at 0.09% tungsten trioxide, making it one of the largest tungsten deposits in the Western world.

The project is situated in the Extremadura region, in the Provinces of Caceres-Badajoz, approximately 310 kilometres south-west of Madrid. The site is accessed directly from the highway along a three-kilometre asphalt road and is serviced by electricity and water.

The La Parrilla tailings deposit and tungsten mine development also offers a low-cost, high-margin resource development opportunity for W Resources.

The price of tungsten has more than doubled over the past three years, driven by strong growth in Chinese consumption; the difficulty of finding a substitute for the metal; and the high cost of getting new mines into operation. And this is unlikely to abate.

Financially, the company appears to be close to receiving a loan for the construction of the processing plant, reducing the risk of an equity placing.

Tungsten Manufacturer & Supplier: Chinatungsten Online - http://www.chinatungsten.com
Tel.: 86 592 5129696; Fax: 86 592 5129797
Email: sales@chinatungsten.com
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(3) Tungsten carbide

    Tungsten carbide industry occupies an important position in the national economy. The mainly raw material of cemented carbide is tungsten. According to the pertinent data from U.S., about 50% of the tungsten is used for cemented carbide manufacture. Currently more than 50 countries in the world produce carbide and the annual production is about 2.8 million tons. Developed countries in the world are in a leading position of carbide industry, mainly in the following areas:

    1) Precision dedicated tungsten carbide tools. According to the reports, the large-scale production line of sedan needs a large number of special carbide tools. The statistics data abroad shows that if the annual production capacity is 3 million cars, the requirements of special tungsten carbide tool output value should be $ 200 million to $ 300 million. At present, the productions of precision dedicated tool are basically monopolized by large foreign companies.

    2) Tungsten extrusion technology. For example, the advanced technology of plasticizing extrusion with powder is applied abroad, which is capable to produce ultrafine nanocrystalline carbide cutting tools, and complex shaped products. This technology has very significant economic benefits. For example, the output value of imports carbide bar with screw holes is up to RMB4,000.00/ kg, general ф6mm high-performance hard alloy extrusion bar output value is up to RMB1,000.00/ kg, however, general carbide products output value is only RMB200.00/ kg.

    (3) Nanostructures tungsten carbide. Rutger University took the lead of fluidization thermochemical conversion process (SCP) had successfully developed a nano-structured tungsten carbide cobalt composite powder, and quickly reached the scale of production, the powder grains less than 50 nm. Micro drill, tape cutter, scalpel manufactured by nanostructures  tungsten carbide have two times working life than the currently used microcrystalline alloy products, the nanostructures tungsten carbide will become one of the most popular new materials in the 21st century.

Tungsten Manufacturer & Supplier: Chinatungsten Online - http://www.chinatungsten.com
Tel.: 86 592 5129696; Fax: 86 592 5129797
Email: sales@chinatungsten.com
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