American government lenders do not plan to approve financing for Cove Kaz Capital’s tungsten project in Kazakhstan, worth a total of $1.6 billion. According to Bloomberg, the US Export-Import Bank (EXIM) and the Development Finance Corporation (DFC) doubt the project’s viability and are concerned about geopolitical risks stemming from Kazakhstan’s proximity to China and Russia.
Earlier, both organizations issued letters of interest to the project: EXIM for $900 million and DFC for $700 million. However, such documents do not obligate lenders to provide funds. A DFC representative said the corporation is not currently considering the deal and that the project is only at the first of four stages of evaluation. The EXIM letter expired in August, and the company has requested an extension.
Cove Kaz says American officials still support the project. Chairman of the board Pini Althaus said a formal financing application is planned after the final feasibility study is completed in 2027, and that no borrowed funds are needed until then.
The project develops the Northern Katpar and Upper Kairakty deposits in Karaganda region. Cove Kaz owns 70%, with the remaining 30% held by state-owned Tau-Ken Samruk. Total resources are estimated at 1.4 million tonnes of tungsten trioxide, and once at full capacity the operation could produce about 12,000 tonnes of tungsten per year, roughly 15% of global output. Mining is planned to start in 2030, with the feasibility study to be completed by the end of 2027.
Meanwhile, the company is preparing to go public. On November 2, it announced the termination of its merger with Skyline Builders and a new commitment from American Ventures, which is linked to the Trump family, to invest $32 million. This implies a business valuation of $1.97 billion, 76% higher than before. The president’s sons Donald Jr. and Eric, according to the WSJ, will receive an indirect stake of less than 1%. Their representative said the brothers are not involved in management and were unaware of the listing plans.
The story around Cove Kaz shows the gap between political ambitions and the real readiness of projects. Tungsten is critically important for the US defense industry, but without confirmed economics and resolution of geopolitical questions, government money remains only a promise. For Kazakhstan, this is a signal that attracting Western capital into strategic subsoil requires not only support at the highest level but also convincing calculations.
Source: Bloomberg
