EDITOR: | October 25th, 2017 | 1 Comment

The dawn of a niobium and scandium renaissance

| October 25, 2017 | 1 Comment
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Humanity’s dependable need for progress has long motivated engineers to improve commonly used materials, and metallic alloys are no exception. The pressure to reduce emissions and increase efficiency could create a renaissance of sorts for two of the least mined elements on Earth.

One of our subjects, scandium, can be used to lighten aircraft by up to 20%, but difficulties relating to its extraction keep current consumption to a minimum. Similarly, niobium is a prime candidate for decreasing material weights, but economical deposits are so rare that only three primary producers of niobium exist globally, none of which are in the US, and zero new niobium mines have come online since the 1970s.

The evidence currently suggests that uptake would be vastly higher if the supply side was able to provide the necessary goods, since the monetary and ecological savings of lightening large metallic bodies are obvious. This is borne out by the fact that NioCorp Developments Ltd. (TSX: NB | OTCQX: NIOBF) (“NioCorp”) has already shifted 75% of its ferroniobium product-to-be in the form of offtake agreements with two major metallurgical companies.

The material will come from the company’s Elk Creek deposit in Nebraska which, already being in possession of a full feasibility study, is on the brink of construction. In fact, the CEO of NioCorp recently ploughed another $180,000 of his own money into the development of the project; confidence is high all round.

The study reveals that Elk Creek is expected to produce 7,055 tonnes per annum (tpa) of ferroniobium, 103 tpa of scandium trioxide, as well as 11,445 tpa of titanium dioxide over its 32-year operating life. Given that the current scandium market is only good for around 15 tpa, these are indeed some ambitious numbers, but they are supported by the fact that new patents involving scandium applications have increased dramatically in recent years in anticipation of the cost savings. And besides, it would only take a tiny fraction (0.1 percent) of the annual aluminum market to reasonably create around 350 tonnes of annual global scandium demand. The NI 43-101 compliant report also states that the resource could attract a total lifetime revenue of $17.6 billion, so anyone interested in helping to fund this project should be amply rewarded.

Numerous new applications for scandium have been identified and are under research; most notably high intensity stadium lighting, high voltage power transmission and 3D printing could all benefit massively from increased scandium supply.

The need for these materials is clearly strong, but the United States currently produces neither. The state military applications alone could give rise to billions of dollars worth of offtake if scandium and niobium alloys were applied to their fullest potential, and the resulting fuel savings could have a positive environmental impact of colossal proportions. The pursuit of lighter metals is therefore not simply a cold economics game to benefit shareholders, but an all-round-good-for-everyone affair.

The USA’s commitment to construction in the near-future creates an opportunity to employ more superalloys in pipelines, rail networks, buildings, aircraft and many other areas. Despite the low production rates of these elements, there really is no shortage of applications for lighter metals, and this is why Elk Creek appeals to me so strongly; it exists in a complete vacuum.

Upon the launch of the project, the USA should not only receive significant tax revenue (just over $27 million each year), but become one of the world’s top suppliers of superalloys. Materials scientists will always strive to improve products wherever possible, and I fully expect this pressure to manifest as a bolstered superalloys market over the next decade.


Lara Smith

Editor:

A Sr. Editor and Analyst for InvestorIntel and Managing Director and Founder of Core Consultants, Lara is an internationally recognized expert in the field of ... <Read more about Lara Smith>


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Comments

  • Tracy Weslosky

    This is an excellent piece Lara, thank you. The management team at NioCorp have been leaders in sustainability related issues in the technology metals market and there is some great nuggets in this piece for investors seeking understanding and opportunity for this geopolitically charged market which affects all of us. Having been involved in the industry for almost 10 years now, had a good update from LYNAS’ CEO Amanda Lacaze and Gavin Lockyer from ARAFURA last night, and the issues relating to the looming shortage of technology metals was front and center themes of the evening. The CEO for NioCorp has been a keynote speaker at several Cleantech & Technology Metal Summits, and we will be interviewing Mark in the next couple of weeks to get an update for InvestorIntel readers — so send me your questions at info@investorintel.com.

    October 26, 2017 - 12:44 PM

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