industrial minerals – routes to opportunities

INDUSTRIAL METALS, MINERALS & MINEABLE ENERGYINVESTMENT SUMMIT

IRONMONGERS’ HALL, CITY OF LONDON ● THURSDAY, 3 NOV 2011

www.ObjectiveCapitalConferences.com

Industrial Minerals – Routes to opportunitiesBrian Coope – Industrial Minerals Analyst

Industrial Minerals – Routes to Opportunities

• Brian Coope – Industrial Minerals Analyst

• Differences between Industrial Minerals and Metallic Ores and Fuel Minerals

• No terminal markets, lack of standardisation, close relationship between mineral and market, multi-product, multi-use

Exploration begins with markets

SIX STAGES OF A PROJECT

1. Enthusiasm2. Disillusionment3. Panic4. Despair5. Search for the Guilty6. Punishment of the Innocent7. Decorations for those who took no part

Routes to Opportunities

• Shortages and rising prices• Critical lists • Focus on China • Technology changes• Legislative and environmental changes

Potash price spike in 2009

Moon journeys – Zircon 1974

Reason: Japanese refractory technology shift

19701973

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19821985

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20002003

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Zircon Price US$/tonne

US$

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ne

Zircon Moon journeys 1974, 1989, 1995 and….

Zircon Moon journeys ……and 2011

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19761979

19821985

19881991

19941997

20002003

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Zircon Price US$/tonne

Price $/t

Critical Lists1982 2010 2011

House of Lords   EU  BGS

Antimony Antimony Antimony

Chromium Beryllium Bismuth

Cobalt Cobalt Bromine

Manganese Fluorspar Graphite

Molybdenum Gallium Mercury

Niobium Germanium PGM

Nickel Graphite Niobium

PGM Indium Rare Earths

Phosphate rock Magnesium Strontium

Tantalum Niobium Thorium

Titanium PGM Tungsten

Vanadium Rare Earths  

  Tantalum  

  Tungsten  

EU Critical Raw Materials Study 2010Rare Earths

Barite FluorsparGraphite

ChromiteManganeseDiatomite

Talc Perlite

Lithium BoratesBentonite Silica Titanium

Magnesite

MagnesiumAntimony

Bauxite

BGS Risk List 2011 – Top TenElement Risk Index Leading producerAntimony 8.5 ChinaPlatinum group 8.5 South AfricaMercury 8.5 ChinaTungsten 8.5 ChinaRare Earths 8.0 ChinaNiobium 8.0 BrazilStrontium 7.5 ChinaBismuth 7.0 ChinaThorium 7.0 IndiaBromine 7.0 USAGraphite 7.0 China

China’s role in world IMs

• 1970s – only a few industrial minerals exported – specialist traders Canton Fair

• 1980s -- Established trade but low prices lead to anti-dumping

• 1990s – Rise in quality and value-added products

• 2000s – Increasing domination across the board, export tariffs & quotas, enforced closures of illegal and hi-polluting operations

Technology Changes

• Clean Energy Technologies – Batteries, Magnets, Phosphor lighting, Solar cells– Rare earths, lithium

• TV screens – CRTs to Flat screens– Strontium down, rare earths up

• Steelmaking and refractory technology– Magnesia, graphite, alumina, spinels, zircon &

zirconia

Legislation & Environmental Changes

• Asbestos -- wonder-material but deadly

– No single substitute– Reinforcing -- glass, ceramic, cellulose, Wollastonite, Talc. Mica– Insulation -- glass fibre, mineral wool, ceramic fibre, perlite, vermiculite– Gaskets, graphite, wollastonite, glass fibre

• Fire hazards -- polystyrene ceiling tiles -- perlite again • Fire retardants -- oxides/hydroxides of aluminium, magnesium,

antimony -- bromine• Emissions -- FGD limestone to gypsum• Waste & water treatment

Opportunities in Industrial Minerals – which route?

• Most likely to arise for existing IM producers– Specialised media “Industrial Minerals”, Conferences, etc– Approaches from exploration companies

• But exploration companies in Gold, Base Metals, & Oil– May have a regional advantage. When in West Africa,

Siberia, or wherever – Take an interest in local minerals and mineral-based

industries – Wealth of data often available