【By Observer Net, Yuan Jiaqi】
According to Bloomberg, on the 22nd, in order to compete with Chinese companies, the Trump administration of the United States is participating in negotiations in "unconventional" ways, pushing a U.S. company to obtain the rights to exploit the world's largest undeveloped tungsten mine in Kazakhstan. Tungsten is a key metal for manufacturing ammunition, shells, and other weapons equipment.
The report cited sources who said that U.S. Commerce Secretary Rovnick has facilitated negotiations between New York-based Cove Kaz Capital Group and the Kazakhstan Sovereign Wealth Fund to bid for the development of two of the largest tungsten mines in this Central Asian country.
According to sources, the negotiations between Cove Kaz Capital and the Kazakhstan Sovereign Wealth Fund "Samruk-Kazyna" have lasted for several months, but face intense competition, as "at least one Chinese state-owned enterprise is willing to bid at a price higher than the market." Some people said that Cove Kaz Capital needs support from the U.S. government to ensure it gets the funds needed to complete the transaction.
Although the details of the transaction have not been finalized yet, the sources said that the options being considered include the U.S. government providing loans for the transaction. A U.S. official who did not want to be named added that the Trump administration currently has no intention of acquiring equity in the project.
According to the sources, the U.S. government is playing an advocacy role through the International Trade Administration (ITA) under the Department of Commerce, and may also provide financial support for the plan through federal entities such as the U.S. International Development Finance Corporation (DFC) and the U.S. Export-Import Bank (EXIM Bank).
The report pointed out that usually, direct negotiations with foreign sovereign wealth funds are led by private companies, not high-ranking U.S. officials. Although the specific extent of Rovnick's involvement is still unclear, the matter highlights the Trump administration's willingness to use unconventional means to acquire assets it considers crucial to national security.
Bloomberg stated that the White House's involvement in the negotiations is one of the measures taken by the United States to expand its supply of critical minerals and gradually reduce its dependence on China. The competition between China and the United States in the field of critical minerals has become one of the core issues in the trade disputes between the world's two largest economies.
The report also emphasized that this tungsten mine transaction project has put the United States and China into direct competition over tungsten mining rights. "This scene of two economic superpowers engaging in a bidding war in a former Soviet republic to compete for mineral rights is extremely rare," the report said.
Screenshot of the official website of the Kazakhstan National Mining Company Tau-Ken Samruk
According to the sources, these two mines are valued at billions of dollars. The Kazakhstan Sovereign Wealth Fund has listed the locations of the mines on its website—Upper Kairaktinskoye and North Katpar—and stated that these two mines will "make Kazakhstan one of the main players in the global tungsten market."
Tungsten mining activities in Kazakhstan had basically ceased about 30 years ago. According to the information, the total reserves of these two mines are estimated to be about 1.3 million tons of tungsten (equivalent amount). The source said that after the new mine comes into operation, it can supply for 30 to 40 years.
The person also said that the Kazakhstan Sovereign Wealth Fund believes that these two mines are the most valuable undeveloped tungsten resources in the world, so they have invited multiple parties to bid.
The current negotiation content includes: establishing a joint venture with Cove Kaz Capital, with the American company operating the mine and building production and processing facilities within Kazakhstan; the output of tungsten will be transported to the United States for defense and commercial purposes; Kazakhstan will participate in profit sharing, while the American company will become the majority shareholder of the project.
Earlier this year, Cove Kaz Capital had already established a joint venture with the Kazakhstan National Geological Survey Company "Qazgeology" to develop rare earth projects.
According to the report, so far, the White House, the U.S. Department of Commerce, the lobbying company representing the Kazakhstan Sovereign Wealth Fund, and Cove Kaz Capital have not responded to requests for comment.
The U.S. media cited data from the U.S. Geological Survey, which states that China accounts for about 80% of the global production of tungsten concentrate. The Defense Logistics Agency, which manages the U.S. strategic reserves, has listed tungsten as a key focus item. The U.S. Geological Survey has also included tungsten in its list of critical minerals and pointed out that any major disruption in tungsten supply would affect the U.S. GDP.
According to the report, the U.S. Geological Survey does not list Kazakhstan among the top countries for global tungsten recoverable reserves, but the Kazakh side estimates that its tungsten reserves exceed 2 million tons.
The Trump administration has previously started to strengthen cooperation with Kazakhstan. Earlier this year, the U.S. Department of Commerce helped facilitate a $4.2 billion railway deal, under which the U.S.-based Wabtec Corporation, a manufacturer of locomotive parts based in Pennsylvania, reached a sales agreement with the Kazakhstan State Railway Company.
The report mentioned that before news of this tungsten mine transaction was released, the President of Kazakhstan, Tokayev, met with Rovnick in September, and Trump called during the meeting. It is currently unclear whether the tungsten mine project was discussed during this meeting.
The New York Times reported in July that historically, the United States was a major investor in Kazakhstan, with investments mainly focused on oil and gas development. After reaching a peak in 2022, investments from the United States in the country have declined. In recent years, mining companies from the United States and other countries have been looking for ways to develop Kazakhstan's mineral resources. In 2024, the Kazakh government issued more than 50% more mining exploration licenses compared to the previous year.
It is known that Kazakhstan is a potential hotspot for key minerals and rare earth metals required for electric vehicles and other advanced products. For a long time, it has been known for its uranium, gold, and other metal reserves. This year, the Kazakh government also announced the discovery of a large rare earth deposit. If confirmed, this deposit would make Kazakhstan one of the world's largest reserves of rare earths.
The New York Times pointed out that the global supply of critical minerals and rare earth materials is mainly dominated by China, and the United States is urgently trying to build a supply chain independent of China. Kazakhstan has rich critical mineral and rare earth resources, and is deepening its relationship with China, making the U.S. demand for its resources even more urgent.
However, analysts say that Trump's tariff threats could backfire, further pushing Kazakhstan towards China and Russia. In early July, Trump sent tariff letters to Kazakhstan and other countries, threatening that if they could not reach a trade agreement, they would face a 25% tariff.
Teniz Capital, a Kazakh investment bank, said in a report to its clients: "Many people in the region see the United States as a potential balancing force independent of its huge neighbor China and Russia. Now, this goodwill is at risk of deteriorating. As the U.S. increases barriers, China and Russia are preparing to take advantage of the opportunity to find stable partners in Central Asia."
This article is an exclusive article by Observer Net. Unauthorized reproduction is prohibited.
Original: https://www.toutiao.com/article/7563855121995432498/
Statement: This article represents the views of the author. Please express your opinion by clicking on the [top/down] buttons below.