US-Kazakh Deal Aims to Break China's Grip on Critical Tungsten

ASTANA, Kazakhstan – February 13, 2026 – In a move poised to reshape the global critical minerals landscape, New York-based Cove Kaz Capital Group and Kazakhstan’s state-owned Tau-Ken Samruk have finalized a landmark deal to develop the world’s largest known undeveloped tungsten resource. The $1.1 billion joint venture marks a significant step in a U.S.-backed strategy to build a secure, allied supply chain for a mineral indispensable to defense and high-tech industries, directly challenging China’s long-standing market dominance.

The agreements establish Severniy Katpar LLP, a partnership where Cove Kaz holds a 70% interest and Tau-Ken Samruk retains 30%. This entity will develop the Northern Katpar and Upper Kairakty tungsten deposits in Kazakhstan's established Karaganda mining district. The project is not just a commercial enterprise; it is a cornerstone of deepening strategic ties between Washington and Astana, born from high-level diplomatic engagement.

“This milestone reflects the trust and partnership we have built with Tau-Ken Samruk and the broader leadership of Kazakhstan,” said Pini Althaus, Executive Chairman of Cove Kaz Capital Group, in a statement. He emphasized the project’s role as a foundation for “long-term industrial cooperation between the United States and Kazakhstan.”

A Strategic Play in the Minerals Race

The project’s significance is magnified by the current geopolitical climate. Tungsten, prized for its extreme hardness, density, and high melting point, is critical for applications ranging from armor-piercing munitions and missile components to semiconductors and electric vehicle batteries. For decades, China has controlled over 80% of the global tungsten supply, a dominance it has recently leveraged by imposing export controls. These restrictions, which took full effect in February 2025, have caused significant price volatility and supply chain anxiety in the West.

This U.S.-Kazakh venture is a direct response. The original announcement was made during the C5+1 Leaders’ Summit in Washington, D.C., attended by former President Donald J. Trump and Kazakh President Kassym-Jomart Tokayev, underscoring the project's high-level political backing. The deal aligns with a broader U.S. strategy to diversify its critical mineral sources away from geopolitical rivals, with Central Asia emerging as a key region of focus.

“With planned production of 12,000 tonnes per annum and the largest undeveloped tungsten resources globally, this project will anchor a secure, allied supply chain for decades,” Althaus stated, highlighting the project's strategic value.

Unearthing a Giant: Scale and Ambition

The sheer scale of the Kazakh deposits is staggering. According to JORC-compliant feasibility studies, the Northern Katpar and Upper Kairakty sites contain an estimated 1.4 million tonnes of tungsten trioxide (WO₃), representing approximately 70% of Kazakhstan's total tungsten resources. When operational, the project is expected to produce a combined 12,000 metric tonnes of tungsten annually—a figure that would represent roughly 15% of current global production.

This influx of non-Chinese tungsten is expected to have a stabilizing effect on a market roiled by supply restrictions. More importantly, the venture includes plans for downstream processing within Kazakhstan. Cove Kaz intends to build a fully integrated complex capable of producing high-purity ammonium paratungstate (APT), a refined tungsten intermediate, and other compounds. This vertical integration is crucial, as it breaks China's stranglehold not only on mining but also on the more lucrative and technically complex refining stage of the supply chain.

Dominic Heaton, CEO of Cove Kaz, brings experience from developing Vietnam's Nui Phao mine, the largest tungsten operation outside of China. “This is a technically sophisticated project at significant scale,” Heaton commented. “Our focus turns to disciplined execution... We intend to build a fully integrated mining and processing complex capable of producing high-purity ammonium paratungstate in Kazakhstan at globally competitive standards.”

Kazakhstan's Economic Transformation

For Kazakhstan, the project represents a major economic and industrial victory. The $1.1 billion development cost signifies a massive injection of foreign direct investment. The venture is expected to create approximately 2,000 jobs during its construction and operational phases, providing a significant boost to the Karaganda region.

Beyond the immediate economic benefits, the project advances Kazakhstan's long-term strategy of diversifying its economy away from a heavy reliance on oil and gas. By developing its vast mineral wealth and establishing domestic deep-processing capabilities, the country is positioning itself as a key player in the global high-value materials market. This partnership elevates Kazakhstan's role from a mere supplier of raw materials to a producer of value-added industrial products, enhancing its standing in the global economy and reinforcing its strategic partnership with the United States.

Securing the Financing

Funding a project of this magnitude requires substantial financial backing, and the U.S. government has signaled strong support. The Export-Import Bank of the United States (EXIM) and the U.S. International Development Finance Corporation (DFC) have issued non-binding Letters of Interest for up to $900 million and $700 million, respectively. While these letters are preliminary and contingent on comprehensive due diligence, they represent a powerful endorsement of the project's strategic alignment with U.S. foreign policy and economic security goals.

To convert these letters into firm commitments, Cove Kaz must now complete a Definitive Feasibility Study and satisfy rigorous environmental, social, and financial criteria. The project will operate under Kazakhstan’s 2021 Environmental Code, which mandates the use of best available technologies and adheres to the “polluter pays” principle. As the venture moves from agreement to execution, it will serve as a critical test case for large-scale, Western-backed resource development in Central Asia, balancing immense geopolitical promise with the complex realities of modern mining.