Europe could be set to reduce its dependence on Chinese tungsten, a vital metal for many industrial applications, after higher prices and steady demand sparked renewed interest in mining closer to home.

Plans to open new mines or reopen abandoned ones are advancing and several companies look set to start tungsten production in the next three or four years. Ireland’s Ormonde Mining plans to reopen a mine in Spain to produce 2,270 tonnes of tungsten trioxide a year, and on Monday secured a buyer for 100 per cent of the mine’s output for five years.

According to Ormonde, the project’s capital expenditure will be €48.5m and the mine will be profitable so long as the tungsten price continues to be sold for more than $129 per metric tonne unit, a level far below the current price of $367.50 per mtu.

Other companies could also go into production within the next few years. If that happens, it could potentially offer tungsten consumers in Europe and elsewhere greater protection against disrupted supplies.

Being able to secure tungsten, which is used for the tips of drill bits and metal cutters, is critical for many European industries. It is one of 14 raw materials identified by the European Commission as “critical” and subject to a higher risk of supply interruption.

China is the world’s largest consumer of tungsten and is also by far the world’s largest supplier, accounting for 85 per cent of production in 2013, according to US Geological Survey estimates. China restricts the export of tungsten concentrates, preferring to ship finished tungsten products, and is stockpiling reserves.

“A number of big producers are looking for security of supply,” says Michael Masterman, founder of W Resources a small UK-listed miner. “There is an acute shortage of reliable reserves in the west. There’s been a lot of interest from advanced economies.”

This renewed interest in mines which have been long abandoned as uneconomic has been sparked by the rising price of the dense metal, which is more than four and a half times higher than a decade ago. The EU is poised to introduce voluntary rules to prevent European tin, tantalum, tungsten and gold companies importing so-called conflict minerals.

W Resources started producing a small amount of tungsten trioxide from tailings, or waste mined material, in February at a Spanish mine that had been abandoned. The company intends to generate enough cash from the tailings to re-open the mine. “Tungsten mining projects have relatively low capital requirements . . . and [it is] a very high value product,” says Mr Masterman.

Wolf Minerals will reopen the first and largest of the upcoming European tungsten mines at a site in Hemerdon near Plymouth. It completed funding for the £123m project on Wednesday. According to the developer, it will be the UK’s first metal mine to open in 45 years and will produce 3,450 tonnes of tungsten trioxide a year for a decade from mid-2015. That is more tungsten than Austria, Canada and Russia each produced last year, according to US Geological Survey estimates.

Expected production in Europe will continue to be overshadowed by China, but new European mines will make a dent in China’s dominance. “China is just about maintaining – not growing – its production levels and Canada’s struggling,” says Mark Seddon, director at Tungsten Market Research. “Around 4,000 [extra] tonnes per year is needed [globally]. That’s one big project per year. In the last two or three years we’ve only had one project, Nui Phao in Vietnam, which isn’t actually at full production at the moment.”

Some tungsten buyers are offering finance for mining operations as part of so-called offtake agreements, where they agree to buy future production. The Nui Phao mine was part-financed in this way. W Resources is keen to secure similar agreements for its La Parilla mine and at another site in Régua in Portugal if drilling results are positive.

New tungsten supply in Europe may not mean that the price of tungsten will fall, however. China can still use its dominant position to determine prices. “The whole mechanism is out the window when you have the largest producer publishing guide prices,” says Lewis Black, chief executive of Almonty which produces tungsten at Los Santos in Spain. “It’s in nobody’s interest to see the price collapse – including China’s.”