Elementos Advances Europe's Only Integrated Tin Mine-to-Metal Operation

• Elementos Limited is developing the Oropesa tin project in Andalucia, Spain, with a published DFS showing $270M AUD NPV and 26% IRR at $30,000/tonne tin price
• The company has secured a vertical integration strategy with a 50% option over a Spanish tin smelter 220km away, enabling direct metal production and capturing European tin premiums of ~$1,000/tonne
• Strong permitting progress in mining-friendly Andalucia region with government support through project accelerator unit; expecting public exhibition phase soon as key milestone
• Metals X investment provides funding runway toward FID, while multiple parties including potential equity, debt, and offtake partners are engaged in discussions
• Secondary asset in Tasmania (Cleveland) offers tin-copper-tungsten Critical Mineral Resources and exposure with 16-24Mt exploration target containing multiple strategic metals

Elementos Limited (ASX:ELT) represents a unique proposition in the critical minerals space, developing what Managing Director Joe David describes as a vertically integrated tin operation spanning from mine to metal production in Spain. With tin prices sitting around $33,000 per tonne and supply constraints tightening globally, the company's Oropesa project in Andalucia offers investors exposure to both the tin supply deficit story and Europe's strategic push for domestic critical mineral production.

The company's flagship Oropesa tin project recently published a Definitive Feasibility Study (DFS) demonstrating robust economics with a $270 million Australian dollar NPV using a conservative $30,000 tin price assumption. David emphasizes the project's financial metrics: 

"It's a 5,400 ton per annum tin concentrate operation. We go for about 12 years... it's a 26% IRR with payback just over two and a half years."

The Tin Market Fundamentals

The global tin market presents compelling supply-demand dynamics that underpin Elementos' investment thesis. David provides context on the market's structural challenges: 

"The tin market is only 2% [of the size] of the copper market. We're tiny in that instance. Tin is 35x less abundant in the earth's crust than copper... if you included every single tin development project that sits within listed companies on any of the exchanges worldwide, I think you can count them on two hands."

This scarcity extends beyond geological abundance to operational capacity. The 1986 tin market collapse eliminated most Western producers, leaving production concentrated in Southeast Asia and state-controlled operations. Current supply disruptions in Myanmar, which has been a major supplier of ore into China, combined with reduced Chinese smelter utilization rates dropping to 50% from typical 70-80% levels, have created acute supply constraints.

The demand outlook remains positive despite recent flat growth during the global cost-of-living crisis. Tin's primary use in electrical solder makes it essential for all electronic circuits, positioning it to benefit from resumed global consumption growth and the ongoing electrification trend.

Oropesa Project Economics and Technical Merit

The Oropesa project's DFS demonstrates strong technical and economic fundamentals. The operation will produce approximately 3,300-3,350 tonnes of contained tin annually, representing about 1% of the global tin market from a single project. The mine plan spans 12 years based on current reserves of 15.9 million tonnes, with the 19.6 million tonne resource base offering potential extensions.

Technical specifications show the project achieving 74% average recovery rates, producing a 63-64% tin concentrate grade. This concentrate quality is particularly valuable in current market conditions, as David notes it represents "a very high con" compared to historical standards. The project's metallurgical test work has been completed to DFS level, including pilot testing and variability studies, providing confidence in the production profile.

The mine's sensitivity analysis reveals additional upside potential at higher tin prices. According to David, 

"If we go up another $5,000 on our pit shells, we get another year's worth of production. If we go up $7,500, we get nearly 2 years of extra production."

Vertical Integration Strategy and European Premiums

Elementos' differentiation lies in its vertical integration strategy through a 50% option over a Spanish tin smelter located 220 kilometers from the mine site. This strategic asset enables the company to capture significant value that typical concentrate producers cannot access.

David explains the economic advantage: 

"Tin ingots delivered in Europe currently attract at least $1,000 US premium above the LME trade price... for us, that $1,000 European tin premium means that we can be smelting in Europe effectively for free." 

The economics become compelling when compared to traditional concentrate sales, where producers typically receive 92-93% payables. Through the integrated model, Elementos expects 98-99% recovery through the smelter plus the European premium, minus smelting costs of approximately $950.

This integration strategy also transforms the company's commercial position. Rather than dealing with traders who typically purchase tin concentrate, the company can engage directly with large manufacturers and offtakers seeking finished metal products, potentially improving financing options and contract terms.

Interview with MD, Joe David

Permitting Progress in Mining-Friendly Andalucia

The company has made substantial progress navigating Spain's regulatory environment, specifically within the Andalucia region where 90% of Spain's metallic mining revenue originates. David emphasizes the regional advantage: 

"Andalucia is the major mining region of Spain. The government's very pro-mining they have a state significant project group of which we're a member. There's seven mining projects within that."

Elementos submitted its primary permits in April 2025 following an 11-month consultation period with environmental authorities. The company modified its original proposal to address regulatory feedback, including relocating waste dumps to areas with lower tree density and moving the tailings dam to a different water catchment area that doesn't impact downstream drinking water supplies.

The regulatory response has been positive, with David reporting: 

"The administration has been very positive and it's fair to say. I fully expect the company will be going into a public exhibition phase which will be a major milestone for us." 

Entry into public exhibition requires regulatory assessment confirming the project's feasibility within Andalucian law, representing a significant de-risking milestone.

Strategic Partnerships and Funding Pathway

Elementos has attracted attention from multiple potential partners across the funding spectrum. The recent investment by Metals X demonstrates tin industry confidence in the project. Metals X operates tin assets in Tasmania, providing both financial backing and operational expertise.

David indicates the company is "genuinely considering all options" for project funding, including equity, debt, and off-take arrangements. The vertical integration model opens doors to different types of partners compared to traditional concentrate producers. Several parties have already conducted site visits to both the mining and smelting facilities.

The funding strategy appears well-positioned given the project's advanced stage and the limited number of tin development projects globally. David notes: 

"There's probably only 10 projects in development globally. We've had some very substantial parties come and talk to us."

Cleveland Asset Provides Additional Optionality

The company's Cleveland tin mine in northwest Tasmania offers additional strategic value through its multi-commodity potential. The historical producer operated for 35 years and supplied Allied forces during both World Wars. Current resources include 7.5 million tonnes of tin-copper mineralization and 4 million tonnes of tungsten resources.

The most compelling opportunity lies in a 16-24 million tonne tungsten exploration target below the existing infrastructure. David describes the geological potential: 

"We got a 600 meter intercept of tungsten. It's a porphyry tungsten system... within that system, we've got tungsten, rubidium, molybdenum, bismuth and fluorite. We've got... five or six of the US, Japan's, China's, South Korea's critical minerals list in one ore body."

This asset provides optionality for future development either through internal funding after Oropesa reaches production or through joint venture partnerships to accelerate development timelines.

Market Position and Competitive Advantages

Elementos occupies a unique position in the global tin landscape through several competitive advantages. The European location provides strategic value as David notes: 

"There are no operating tin mines in Europe. There are no vertically integrated primary tin producers in Europe." 

This positioning aligns with the European Union's Critical Raw Materials Act and the broader push for domestic strategic mineral production.

The company's technical team combines international expertise with local Spanish knowledge, including partnerships with Spanish contractors and consultants. The project benefits from existing infrastructure in a former coal mining region, providing access to trained personnel and established industrial facilities.

Environmental and social factors support the project's development pathway. The company has secured support from local mayors across the political spectrum and faces no active opposition groups. Educational partnerships with local universities and access to European transition funds for former coal regions provide additional community benefits.

The Investment Thesis for Elementos Ltd

• Exposure to Critical Tin Supply Deficit: Only ~10 realistic tin development projects globally, with structural supply constraints from Myanmar disruptions and reduced Chinese smelter utilization creating multi-year deficit conditions
• Unique European Strategic Asset: Only proposed vertically integrated primary tin operation in Europe, aligning with EU Critical Raw Materials Act and capturing $1,000/tonne European tin premiums unavailable to concentrate producers
• Robust Project Economics: $270M AUD NPV at conservative $30K tin pricing (current ~$33K), 26% IRR, 2.5-year payback with 74% metallurgical recovery and 12-year mine life offering extension potential
• De-risked Permitting Pathway: Advanced regulatory progress in mining-friendly Andalucia region with government project accelerator support, positive administrative feedback, and approaching public exhibition milestone
• Strategic Partnership Optionality: Metals X investment provides funding runway and operational expertise, while multiple parties across equity, debt, and offtake spectrum demonstrate strong commercial interest
• Multi-Asset Portfolio Upside: Cleveland tungsten-critical minerals asset in Tasmania provides 16-24Mt exploration target with multiple strategic metals exposure for future development optionality

Macro Thematic Analysis

The global tin market exemplifies the critical minerals supply challenge facing developed economies as they transition toward electrification and renewable energy. Tin's essential role in electronic soldering makes it irreplaceable in virtually all electrical applications, from smartphones to solar panels to electric vehicle charging infrastructure. However, decades of underinvestment following the 1986 market collapse have left production concentrated in geopolitically sensitive regions including Myanmar, the Democratic Republic of Congo, and Southeast Asia.

China's dominant position in tin smelting—processing 85% of global concentrates—creates additional supply chain vulnerabilities as Western nations seek to diversify critical mineral sources. The European Union's Critical Raw Materials Act represents a strategic response to these dependencies, prioritizing domestic production capabilities for essential materials. This shift creates premium pricing for regionally produced metals as buyers value supply chain security alongside traditional cost considerations.

Current market dynamics show Chinese smelters operating at 50% capacity utilization due to Myanmar supply disruptions and domestic mine closures, while global demand preparation for resumed economic growth following inflationary pressures. The combination of structural supply constraints, geopolitical considerations, and growing electrification demand suggests sustained support for tin pricing well above historical averages.