Hafnium (Hf) – Alkane’s Destiny to Dominate
The metal I shall look at here is obscure even compared to others I have covered in recent times. There are no primary mines and its uses are either in super-alloys or nuclear plants. It has no public pricing mechanism and the USGS does not even dare to venture which countries the production comes from and how much that production might be. This puts Hafnium in the “more obscure than Scandium” category, which is a dark place indeed.
Rather bizarrely Hafnium takes its name for the Latin name of Copenhagen, which considering that the ancient Romans never got as far as Denmark gives it one of the strangest etymologies in the Periodic Table.
The rationale for visiting the metal though is not mere information but that Hafnium promises to be more on the radar in the future because it makes up a small part of Alkane’s volumes from the its Dubbo Zirconia Project (DZP) but makes up a much more substantial part of the revenues. In the absence of any other apparent producers of size, that makes DZP the heavyweight in the Hafnium space going forward.
What is it?
Hafnium is a chemical element with symbol Hf and atomic number 72. In appearance it is a lustrous, silvery gray, metal. Hafnium is estimated to make up about 5.8 ppm of the Earth’s upper crust by mass. It chemically resembles zirconium and is found in zirconium minerals, hence the presence at DZP. The notable physical difference between these metals is their density, with zirconium having about one-half the density of hafnium.
The most notable nuclear properties of hafnium are its high thermal neutron-capture cross-section and that the nuclei of several different hafnium isotopes readily absorb two or more neutrons apiece. In contrast with this, zirconium is practically transparent to thermal neutrons, and it is commonly used for the metal components of nuclear reactors – especially the claddings of their nuclear fuel rods.
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Hafnium reacts in air to form a protective film that inhibits further corrosion. The metal is not readily attacked by acids but can be oxidized with halogens or it can be burnt in air.
The most high profile usage is in the nuclear industry as Hafnium’s large neutron capture cross-section makes it a good material for neutron absorption in control rods in nuclear power plants.
Hafnium is also used in filaments and electrodes. Some superalloys used for special applications contain hafnium in combination with niobium, titanium, or tungsten. It is also used in alloys with iron, titanium, niobium, tantalum, and other metals. Small additions of hafnium increase the adherence of protective oxide scales on nickel-based alloys and improve the corrosion resistance. An alloy used for liquid rocket thruster nozzles, for example the main engine of the Apollo Lunar Modules in the 1960s was composed of 89% niobium, 10% hafnium and 1% titanium.
Zirconium, (DZP’s main product) is a good nuclear fuel-rod cladding metal, with the desirable properties of a very low neutron capture cross-section and good chemical stability at high temperatures. However, because of hafnium’s neutron-absorbing properties, hafnium impurities in zirconium would cause it to be far less useful for nuclear-reactor applications. Thus, a nearly complete separation of zirconium and hafnium is necessary for their use in nuclear power. The production of hafnium-free zirconium is the main source for hafnium
The chemical properties of hafnium and zirconium are nearly identical, which makes the two difficult to separate. After zirconium was chosen as material for nuclear reactor programs in the 1940s, a separation method was developed. These liquid-liquid extraction processes with a wide variety of solvents are still used for the production of hafnium. About half of all hafnium metal manufactured is produced as a by-product of zirconium refinement. The end product of the separation is hafnium(IV) chloride.
A major source of zircon (and hence hafnium) ores is heavy mineral sands ore deposits, pegmatites, particularly in Brazil and Malawi, and carbonatite intrusions. These deposits of the titanium ores ilmenite and rutile yield most of the mined zirconium, and therefore also most of the hafnium.The most likely new source of hafnium is trachyte tuffs containing rare zircon-hafnium silicates eudialyte or armstrongite, at the DZP.
Some estimates claim that global Hafnium reserves might last under 10 years but with the USGS not able to make an estimate then lesser informed parties are probably even less credible. The main dynamic, since hafnium occurs with zirconium, is that hafnium can always be a byproduct of zirconium extraction to the extent that the low demand requires.
The Hf market is worse that the rare earth business for opaqueness given its strategic significance in aerospace, and it is thought that the current demand is around 100tpa. Like some other specialty metals we have highlighted lately (Scandium in particular), demand is limited by supply and there is potential for greater consumption of Hafnium when the DZP output starts reaching the market. Dare we say it “build it and they will come”.
Hafnium at the DZP
While the original pitch of Alkane Resources Ltd. (ASX:ALK | OTCQX:ANLKY) was the Zirconia potential of Dubbo, the Rare Earth boom then brought to the fore the added “juice” of REE revenue streams. Then other metals started being encountered in commercial grades and we styled it as the deposit that had “something for everyone”. When we did that we did not expect the massively obscure (even by REE standrads) metal Hafnium to go from a twinkle in the eye to a potential major revenue contributor. Alkane, encouraged by significant market interest, began work on a process pathway to recover hafnium as an additional product for the DZP. Therefore it went ahead with separation work to piloting level by the ANSTO labs in Sydney. The developed hafnium process had little impact on the existing flow sheet, with hafnium extracted from the zirconium refining circuit. The hafnium recovery circuit has the added benefit of improving the quality of the zirconium product with potential for higher revenues from this product stream.
The improvement consisted of the addition of a scrub circuit into the zirconium solvent extraction process, to remove the Hafnium for subsequent refining to produce a saleable hafnium product. This addition was made by the Alkane team outside of the Front End Engineering Design (FEED) scope after further research with ANSTO.
Currently the thinking is that, with an assumed recovery of 50% and 200 tpa of 95% grade HfO2 production (with prices for the metal being around US$1,000 to $1,200 per kg – but using $500 for 2020 in the model) then revenues should be of the order of US$100mn per annum by 2020 from Hafnium alone. This would amount to around 18% of expected revenues, so a non-insignificant co-product contribution.
In the opinion of Alkane the preliminary capital and operating estimates of the inclusion of the Hafnium circuit into the final plant design suggest its incorporation will add significant value to the project.
Let me quote the USGS: “World primary hafnium production data are not available. Although Hafnium occurs with zirconium in the minerals zircon and baddeleyite, quantitative estimates of hafnium reserves are not available”. In Hafnium we have a metal that is truly off the radar but be that as it may with prices in a range that reaches as high as US$2,000 per kilo, it is definitely something obscure that is worth handling. Rightly Alkane have used a much lower price in their models than the market price because when they begin production they will be effectively cracking open the shell of this mysteriously traded mineral and exposing it to the glare of daylight which usually results in pricing being less smoke and mirrors.
Even so, the Hafnium component of the DZP mix is going to be a significant one and one that most pundits had not figured into their calculations. Hafnium may be “niche” but it’s a niche that Alkane seems destined to dominate.
Christopher Ecclestone is the EU Editor for InvestorIntel and is a Principal and mining strategist at Hallgarten & Company in London. Prior to founding Hallgarten ... <Read more about Christopher Ecclestone>