Ormonde Mining has signed a deal that will see Hong Kong-based Nobel Group purchase all of the tungsten produced at its Barruecopardo mine in Spain for the first five years of its operation.

The agreement is estimated to be worth around €254m to Ormonde over the course of the deal, based on the current price being paid per tonne of tungsten.

Ormonde Mining, which is headquartered in Co Meath, has been developing its flagship Barruecopardo Tungsten Project in Salamanca, Spain for some time and is currently in the final stages of gaining regulatory approval for mining to begin.

Demand is currently high for tungsten, a particularly hard metal that has uses in drilling equipment as well as many electrical products.

Noble Group, which had revenues of $98bn last year, specialises in the management of energy products, metals and minerals.

Ormonde Mining's shares on the London Stock Exchange closed 4.5% higher on the back of the announcement.