Molybdenum - The Big Secret
Subsequent to my previous report at 321Gold, "Molybdenum The 21st Century Metal". I have done further extensive amounts of research for information on current and future uses of Molybdenum. This has been an undertaking of continual frustration due to lack of mainstream information on this Noble Metal. Outside of the continual references to Molybdenum being used in stainless steel and other specialty metal alloys, fertilizers, lubricants and all the other uses I previously outlined in the 321 report (some of which are not reported in mainstream media) I have found what I consider the 'Big Secret' in regard to Molybdenum.
This so called secret involves
considering that few people in the mining industry pay much attention
to the Catalyst market for Molybdenum, if any at all.
It is considered a small portion of the overall world demand
in any charts, graphs or articles one may see and read. This
is not the case as I see it from all of my own research.
Consider why, when so many pundits and experts have continually
called for the same dramatic and rapid decline in Molybdenum
prices as we have seen in past when it spiked in price, that
it has confounded all the predictions and has remained high for
months on-end, all the while outliving those same wrongful predications.
Today I believe there are little known, but yet profound changes
afoot in the world of energy due to scientific discoveries in
catalyst research that are outside the scope of most mainstream
reports and articles on Molybdenum, and they are so dramatic
and exciting that soon the entire Oil industry will soon be in
shock. These changes being brought about by the new discoveries
in the catalyst sciences involve coal, plastics and even used
tires. The energy field I'm speaking of is 'Liquefaction'.
In the 1950's and even earlier, Coal Liquefaction to produce
fuel oils was known and studied in the USA, Germany, Japan and
S Africa among others. Japan in 1940 produced 30,000 T of liquefied
coal oil. Production continued until the end of WW2. Immediately
after the end of the war the US military banned further research
into coal liquefaction, alleging that it was military research.
The process was costly and compared to the price of a barrel
of Oil, not yet feasible. It has been stated that for Coal Liquefaction
to be cost efficient and profitable, a barrel of crude must sell
for $32.00. The Japanese have published reports stating $20.00
p/barrel. The better the catalyst functions, the higher the liquid
yield rate becomes. Through international cooperation coal liquefaction
has gone from the research stage to commercialization in Japan.
Today Japan, Germany, Indonesia, & the USA have all embarked
on projects with coal liquefaction. Before I continue with this
discussion on the Liquefaction process, I would like to dwell
on crude oil for a moment.
For the last 20 to 30 years
very few refineries have been built worldwide, and none in the
USA. As I write this I'm reading of Venezuela building
three new refineries and expanding two existing ones. China
in a JV with its own Sinopec and Saudi Aramco &
ExxonMobil have begun building their multi-billion-dollar
refinery and petrochemical complex in China's Fujian province.
Meanwhile a JV between Borealis & Abu Dhabi National
Oil Co. is advancing another ethylene cracking facility in
Abu Dhabi. One should be able to see the picture unfolding, "More
Refineries" to come and most likely in Europe, Canada and
the USA first. Other nations will invariably follow suit in this
age of peak oil and rapidly increasing demand from developing
nations like China, India, Brazil & SE Asia etc coupled with
growth in the western world. The more refineries and hydro-cracking
facilities in operation obviously mean's more Molybdenum catalyst
demand. With less sweet crude now available and more sour heavy
crude that has to be refined, it is going to mean more catalyst
On another front Osiris
in France and others involved in the world nuclear industry are
testing a Uranium/Molybdenum enriched fuel for Nuclear
reactors worldwide. This fuel will do away with using weapons
grade Uranium in reactors and once perfected will be used throughout
the world. The cost savings from low enriched fuel as opposed
to the current highly enriched fuel is substantial as well.
The mining industry has been slow in responding to current growth in Molybdenum demand and low inventories. Several new projects, both primary and by-product have been promoted in recent months. Given the need for financing and environmental studies it is questionable if any or most of these projects will be producing by 2009. One or two projects seem to have the thrust, reserves and capability to achieve production in 2007/08 nonetheless. As another aside to the focus of this report it is also noteworthy to mention that a memo from the US Army Research Office: Research For Toxic Compound Destruction, states that the University of Pittsburg has shown that Molybdenum, in the presence of oxygen, is a true catalyst for destruction of nerve gas stimulant. A patent has been awarded on this work.
Now back to the Liquefacton
portion of this report. The China Daily News online on
the 03/12/2004 carried an interesting article on China's liquefaction
projects. They stated in part that China has set up its first
coal liquefaction research centre in Shanghai, a move to safeguard
the nation's increasing oil supply shortage. The centre will
explore and develop direct and indirect liquefaction technologies
to produce gasoline & diesel fuel.
The other aspect of this trend
towards liquefaction is the use of recycled tires and plastics
in the process. The plastics alone it is estimated comprise approximately
21% by volume of US landfill sites. There is obviously no need
to mention the quantities of used tires in the world. The process
for the process involving tires & plastic is called Co-Processing
and is achieved by combining feed-stocks of coal with the other
two products simultaneously.
(Post Script Notes)This
report is not intended to infer that there is some conspiracy
of silence afoot in the Molybdenum or Catalysts markets. In the
title 'The Big Secret' simply refers to the seeming secrecy
in the catalyst markets and to the lack of mainstream attention
paid by mining media to Molybdenum.
Sept 2/05 a London Mining article stated this in part- "Prices of Mo alloys all rose on Friday as buyers in search of large quantities found that the tightness of supply that had characterized the market in the early part of the year has not lifted." End
Yes there is a bottleneck in Roasting facilities and it is having some effect on Mo price, but why is there a bottleneck? Because demand is outstripping world roasting facilities. Quite simple really! With 5-7% more demand projected by various industry participants, I'd say they better get busy building a lot more roasters, and bringing new Primary Molybdenum Mines in the world onstream or we may see $50.00 p/lb Moly in future.
China's Metals Info Network, ANTAIKE on Aug 19/05 says new overseas roasting facilities will not be operational until after 2007.
Albemarle Catalysts of Louisianna who use approximately 10 million lbs of Molybdenum p/a, stated in a recent report- "We expect a 5% yearly growth rate in certain catalyst sectors and thatwith the peak oil events facing the world and new refineries coming onstream (in Saudi Arabia & China) and expect two more refineries in China as well as others around the globe, drilling exploration coupled with drill steel & pipelines etc, the demand for Molybdenum & Cracking catalyst should continue to grow as will the specialty steel demand. Molybdenum has gained a new place of stature in the world's insatiable demand for noble metals." End.
If anyone has information on the Molybdenum markets they wish to share or would like to follow any of the Jr companies I represent please feel free to phone or email me anytime.
Thanks for reading.
Sep 06, 2005
Adanac Moly Corp. website (AUA:TSX-V) (PinkSheets:ANCGF) (Frankfurter:A9N)
Goldrea Resources Corp. website (GOR:TSX-V)
South Pacific Minerals website (SPZ:TSX-V)
Previous articles by Ken Reser on China's Shandong Kingdom of Gold & Molybdenum 21st Century & Beyond, can be found at 321gold here.