en.Wedoany.com Reported - Rackla Metals Inc. (RAK:TSX.V) has announced the closing of its previously disclosed non-brokered private placement financing, raising gross proceeds of C$3.44 million through the issuance of 16 million charity flow-through units at a price of C$0.215 per unit.
Each charity flow-through unit consists of one charity flow-through common share and one-half of one common share purchase warrant. Each whole warrant entitles the holder to purchase one non-flow-through common share at a price of C$0.20 per share for a period of 12 months following the closing of the offering. The company stated that proceeds from the sale of flow-through shares will be used to incur eligible Canadian exploration expenses before December 31, 2027, which will qualify as flow-through mining expenditures effective no later than December 31, 2026, and will be renounced to the purchasers.
Management plans to primarily use these funds to advance exploration and drilling at the Lentung Tungsten Project, located in the western part of the Northwest Territories, and potentially for development of other mineral claims in the region. The company paid a total of C$139,329 in finder's fees in cash and issued non-transferable warrants allowing holders to purchase up to 928,856 common shares at C$0.215 per share for 12 months following issuance.
Rackla has also received a five-year Class A Land Use Permit for the Lentung project from the Sahtu Land and Water Board. The permit allows the company to establish a 49-person camp, conduct a drill-based mineral exploration program, and rehabilitate, maintain, and use existing trails and access roads. The company stated that the project is now fully permitted for the 2026 exploration season.
The Lentung project is located in the Tombstone Tungsten Belt in the western Northwest Territories, approximately 60 kilometers north by road from the now-closed Cantung Tungsten Mine. Rackla noted that Union Carbide Exploration Corp. conducted a major exploration program on the claims between 1977 and 1982, including 26,900 meters of diamond drilling, geochemical and geophysical surveys, geological mapping, trenching, and metallurgical, engineering, economic, and environmental studies.
Company CEO Simon Ridgway commented on the permit acquisition in a press release, stating that the team appreciates the support and feedback received from communities in the region during the permitting process, including the Dehcho First Nations, Sahtu Dene and Metis, as well as local organizations, regional regulators, and governments. He added that since staking Lentung during the 2025 exploration season and acquiring the complete historical database compiled by Union Carbide, the company has been looking forward to redeploying drills to the property to revitalize this belt through a new round of tungsten exploration.
Global efforts to secure tungsten supplies are intensifying. Reuters reported on May 20 that the European Union has included tungsten, rare earths, and gallium in its first joint list of critical minerals for stockpiling, a move aimed at reducing dependence on China. The report stated that this is one of the most concrete measures taken by the EU to protect supply chains for materials used in defense, semiconductors, aircraft, renewable energy infrastructure, and other industrial applications. Reuters noted that most minerals on the list appear on NATO's list of elements deemed critical for the defense industry, prompting Western allies to race to build stockpiles after Chinese export restrictions disrupted global markets.
John P. Connor reported in a June 1 article that since February 2025, tungsten prices have surged 557% to US$2,250 per metric ton unit, driven by supply tightness and surging defense demand. Connor noted that finding additional sources of tungsten is critical for U.S. defense and mentioned that China produced nearly 79% of the world's tungsten in 2025. China tightened export controls on tungsten in February 2025, leading to a 40% reduction in exports to Western markets, thereby pushing up prices and sparking interest in alternative supply sources. Connor also wrote that "overall prices continue to skyrocket" due to expanding demand for tungsten in munitions, armor-piercing weapons, helicopters, fighter jets, semiconductors, and other applications, while global production remains largely unchanged.
Kevin Williams reported in a June 3 CNBC article that conflicts in Ukraine and Iran have simultaneously exacerbated global tungsten supply pressures, driving up prices and deepening concerns among manufacturers and defense suppliers. CNBC reported that China controls up to 80% of global tungsten production and continues to maintain strict export controls on the metal. Mark Vena, CEO and Chief Analyst at SmartTech Research, told CNBC that tungsten is a metal rarely discussed until it is needed simultaneously in missiles, factories, and machine shops, connecting combat, manufacturing, electronics, aerospace, electric vehicles, and everyday tools. Pini Althaus, Executive Chairman of Cove Kaz Capital, told CNBC that the tungsten industry is experiencing unprecedented market conditions, with price increases attributed to supply scarcity caused by the depletion of global tungsten reserves due to the wars in Ukraine and Iran. The report showed that global tungsten production totaled approximately 81,000 metric tons in 2024, with China remaining the primary producer. CNBC further reported that declining Chinese production, increased domestic consumption, and new procurement demand from Western markets have heightened focus on developing additional tungsten supply sources outside of China.
Bob Moriarty, founder of 321gold.com, discussed Rackla Metals' exploration activities and financing status in comments shared with Streetwise Reports on March 31. Moriarty stated that although Rackla was unable to identify the source of widespread gold mineralization discovered during its surface exploration program in 2025, they raised C$10 million when investors poured money into quality junior mining companies. He added that Rackla presented a Plan B, possessing a nearby tungsten deposit with known grades, and therefore he expects the 2026 program to be successful.
Richard Mills wrote in a June 3 article that Rackla Metals has obtained the final permit required to conduct exploration at the Lentung Tungsten Project in the Northwest Territories. Mills noted that with the receipt of the five-year Class A Land Use Permit, the project is now "fully permitted for the upcoming 2026 exploration season." In his analysis, Mills mentioned that the company has acquired Union Carbide's original documents, including original drill logs, assay sheets, mylar maps, and metallurgical, environmental, resource, economic, and geophysical studies. A review of these documents revealed a high-quality dataset confirming a robust deposit with high-grade open-pit potential. Mills also stated that according to U.S. Geological Survey data, the historical resource estimate is listed as one of the highest-grade tungsten skarn deposits in the world. He further noted that this historical resource estimate was calculated based on only three of the 15 identified tungsten mineralized zones within the property.
Regarding upcoming work, Mills wrote that the company plans to establish a 49-person camp, complete 4,000 meters of diamond drilling to confirm historical results, conduct 6,000 meters of reverse circulation drilling, perform surface trenching, rehabilitate roads and trails, and prepare an NI 43-101 resource estimate after the exploration season. He noted that "the 2026 field program is scheduled to begin in late May." Mills also reported that the company has completed a non-brokered private placement, raising gross proceeds of C$3.44 million through the issuance of 16 million charity flow-through units at C$0.215 per unit, with management planning to use the proceeds primarily for exploration and drilling at the Lentung Tungsten Project, and the company's "cash position now stands at C$13 million."
Rackla stated in its corporate presentation that the 2026 Lentung field program will commence in the second quarter of 2026. Planned activities include establishing a new 49-person camp on site, completing 4,000 meters of diamond drilling through 27 infill holes to confirm historical Union Carbide results and bring them up to modern standards, and conducting 6,000 meters of reverse circulation drilling to further delineate known mineralization. The company also plans surface trenching to expose shallow tungsten mineralization and to clear and rehabilitate 25 kilometers of existing roads and trails on site, as well as the access trail to the Howards Pass corridor. Following the exploration season, Rackla plans to prepare a National Instrument 43-101 resource estimate for the Lentung project. Additional information provided by the company indicates plans for extensive drilling at the Lentung high-grade target, with the goal of updating the NI 43-101 resource by year-end. Rackla also stated it plans to evaluate the cost and feasibility of rebuilding the Cantung mine and continue developing working relationships with local Indigenous groups.
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