EDITOR: | August 27th, 2017 | 6 Comments

The Age of Scandium

| August 27, 2017 | 6 Comments
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Historically, scandium applications have flown under the majority of investors’ radars since economical deposits are extremely rare. As a result, small quantities of the metal are traded between private entities for undisclosed sums, and as such, the world has no accurate idea of how much is traded and at what price. At the beginning of any market, however, there comes a point when enough material changes hands that people begin to take note; analysts begin to accurately track stockpiles, supply and demand, and the resource may even appear on terminals and futures markets. Right now, the only thing missing to initiate this new age for scandium is decent supply, as unique applications are already widely known.

Scandium International Mining Corp. (TSX: SCY)(“Scandium International”) are inching ever closer to a primary supply out of New South Wales, Australia, and things are looking good; the company recently acquired 100% interest in its flagship resource (previously it held 80%) in order to accelerate its development. The project has now received all key approvals, including a mining lease, necessary to proceed with project construction, which comes in at $87.1million, according to the Definitive Feasibility Study (DFS) completed in 2016.

Scandium has been used in the past to create uniquely strong aluminium alloys that were thought to be utilised by the Russian military in the construction of lightweight parts for their MiG fighters. Russia still sells these historic stockpiles to industry, but it is thought that the coffers are rapidly emptying. Demand for scandium is still an estimated quantity, but it is believed that global consumption is now around 15 tonnes per year. Looking back, annual scandium consumption was always thought to be around 2 – 10 tonnes, so not only have we seen an increase of late, but furthermore, if only a miniscule fraction (0.1%) of the global aluminium market were to involve scandium in production, we would see demand surge to around 350 tonnes annually. The only missing ingredient here is stable supply of useful quantities.

I firmly believe that, since Scandium International are on-track to bring online the world’s first primary scandium deposit, this company could itself be the black swan that initiates the paradigm shift that takes scandium out of ambiguity and into the hearts and minds of traders and analysts. The company’s deposit, known as Nyngan, could produce 37,690 kg of scandium oxide each year according to its Definitive Feasibility Study (DFS), with operating costs of US$557/kg scandium oxide. The DFS also assumes that the price of the finished oxide material is US$2000/kg, but in reality, this is the very bottom end of the scandium oxide selling price, with 1kg going for as much as three times that today.

It is well known that scandium is difficult to find due to it being a dispersoid; it can’t stand to be around itself. The fact that the Nyngan deposit features grades as high as four times what we’d normally see means that the company has a real chance of pioneering mass consumption of a metal, whilst enjoying the protection from competition afforded by its obstinate loneliness. Scandium is a big deal of an opportunity, and since it cannot currently be traded on futures markets, an interested investor would do well to pay close attention to the company closest to initiating meaningful supply.


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

  • Lou Louizidis BE(Chem)

    Hi Lara.
    If you are really keen on Scandium, please research Platina Resources Ltd (ASX:PGM) which owns the pick of the Scandium resources in New South Wales, Australia, hence the world. PGM is currently completing its DFS for a starter project of 42 tpa Scandia from 40+ years’ reserves/resource at 600+ ppm, double the grades of SCY, yet is only currently capped at about one fifth that of its northern neighbour. It seems obvious Canadians understand the disruptive potential of Scandium better than Australians atm.
    Cheers, Lou
    PGM Shareholder.

    August 28, 2017 - 4:12 AM

  • Rog Cook

    Seems Scandium is flourishing! I aim to buy CleanTeQ. Cobalt production is imminent, Scandium is next and the water purification will be a real money spinner.
    I picked up the comment below from another site:
    BUSINESS MODEL CleanTeQ is a hybrid company based with three bases: scandium mining and production, cobalt mining and production, and water purification. This seems like an odd combination, but as you will see, it is not. It is a stroke of genius. And I will explain why we should care about scandium and cobalt.
    (1) The company is starting production of the Syerston mine, the world’s only scandium mine;
    (2) The company will also produce significant amounts of cobalt as a co-product to the scandium;
    (3) The company has a large-scale water purification technology, which will target municipalities, Industrial operations with waste water problems, and mines, which also have water problems

    August 28, 2017 - 6:07 AM

    • Bruce Riddell

      CLQ will mine nickel and cobalt to produce extremely high grade nickel sulphate and cobalt sulphate (as opposed to metals) to ideally suit the li-ion battery market. The high grade scandium will be bi-product with a production of cost of zero I believe. Makes for quite some profit margin methinks.

      August 29, 2017 - 7:44 PM

  • Rog Cook

    Sorry, should have added
    CleanTeQ has tickers CLQ.AX or CTEQF over the counter.

    August 28, 2017 - 6:18 AM

  • Aat Oskam

    Watch Australium Mines Limited also: their Sconi Cobalt/Scandium Project is a fast track project: a technically viable mining project capable of producing 50 tonnes of high purity scandium oxide (Sc203) per year over a 20-year mine life, and generating an average EBITDA of $59 million per annum.

    August 28, 2017 - 4:54 PM

  • Aat Oskam

    Australian Mines is fasttracking (ASX:AUZ) a scandium project

    September 1, 2017 - 5:02 PM

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