Tungsten Mining NL (ASX:TGN) has announced a major drilling campaign at its Watershed Tungsten Project (WTP) in Queensland, even as trading in the ASX-listed tungsten explorer's shares remained relatively quiet on Tuesday.

The company's shares have risen nearly 200% year-on-year, reflecting growing investor interest in tungsten as the metal becomes central to multilateral strategic mineral supply agreements and faces supply shortages. Tungsten is designated a critical mineral by the United States, the European Union, and Australia, reflecting its importance to industrial manufacturing, semiconductors, and military hardware such as armour-piercing munitions.

Earlier this month, the United States moved to restrict exports of tungsten scrap, requiring deliveries to be directed exclusively to US-based customers. Tungsten prices have surged by as much as 800% in some jurisdictions in recent years amid a combination of supply chain pressures. China accounts for the majority of global tungsten production and export quotas, leaving Western governments seeking diversified sources of supply. The metal, known for its exceptional hardness and heat resistance, is in high demand for defence applications, which accounts for a significant portion of existing supply.

Those broader market dynamics are unlikely to ease in the near term, even as Tungsten Mining remains some distance from commercial production at Watershed.

The company has outlined an extensive drilling program designed to advance the project. A reverse circulation (RC) drilling campaign will target 175 holes for a total of 15,000 metres of core equivalent, while a diamond drilling program will target 75 holes for 5,700 metres of core. The diamond program is intended to strengthen metallurgical and geotechnical understanding as the mineralisation contours at Watershed become clearer.

Results from the drilling programs are expected in October and will ultimately inform a JORC-compliant resource estimate, mine plan, and open pit design. The Watershed deposit, located in north Queensland near the town of Mutchilba, has been the subject of intermittent exploration since the 1980s and represents one of the more advanced tungsten development projects in Australia.

"The RC drilling is concentrated within areas of known high-grade mineralisation … at the same time, the diamond program will provide the metallurgical samples and geotechnical information required to refine process design, pit design and detailed engineering," said TGN Chair Gary Lyons.

"Together, these programs will further enhance the technical definition of Watershed and help reduce project development risk as we advance."