Interesting post on platinum, exhaust catalysts etc.
A post from the HotCopper site. HotTips. From: runningbear crazyhamish@hotmail.com
Platinum, Bill Gates and Fuel Cells
As many of you would have already realized. There is an emerging bull market emerging in platinum and its sister metals that looks set to continue for quite some time. The question then becomes, what is fundamentally driving this market, and how can we profit from it? So I?ve tried to dig a little bit deeper, to see what?s behind it all.
Firstly, what is Palladium?
Platinum is a silvery metallic chemical element, a member of the six transition elements in Group VIII of the periodic table known collectively as the platinum metals (ruthenium, rhodium, palladium, osmium, iridium, and platinum).
Soon you will find out why potentially these first five platinum metals may very quickly become exponentially more valuable than platinum.
Platinum was discovered in South America independently by Antonio deUlloa in 1735 and by N. Wood in 1741, but it had been in use by pre-Columbian Indians. The platinum metals are extremely rare elements; platinum itself is the most common, with an abundance in the Earth's crust of about a millionth of 1 percent, whereas the others of the group have abundances of about one ten millionth of 1 percent. Platinum
occurs in nature as the pure metal and also in alloys with other metals of the group, principally in the alluvial deposits of the Ural Mountains, of Columbia, and of some parts of the western United States. In addition the element occurs in the mineral sperrylite and in the nickel bearing deposits of Ontario in Canada.
The large scale production of nickel makes it in some cases, feasible to recover the small amounts of platinum (only 1 part of platinum to 2 million parts of ore).
This last point has huge ramifications for nickel producers, as currently unfeasible recovery or the platinum may become very profitable if the platinum metals continue to rise. So nickel producers have an interest in seeing platinum prices rise.
The recovery of the individual platinum metals from the natural alloys is a complex process that depends upon the distinct properties of the individual elements, even though all members of the group are generally similar in their chemical behaviour and are quite unreactive. For example,
when the natural alloy of platinum, palladium, osmium, and rhodium is digested with aqua regia, the palladium and platinum dissolve and are extracted as a solution of chloropalladic acid and chloroplatinic acid.
Platinum is then precipitated from this solution as ammonium
chloroplatinate.
Because of its inertness and attractive appearance, one of the major uses of platinum is in the manufacture of jewellery. Gold platinum alloys, referred to as white gold, are widely used in dentistry and in the making of jewellery. Platinum and its alloys are used in the manufacture of
crucibles and evaporating dishes for chemical analyses. Other applications include the formation of thermocouple wires, electrical contacts, corrosion resistant apparatus, and the manufacture of platinum resistance thermometers used in the temperature control of furnaces.
The alloy, consisting of 76.7% platinum and 23.3% cobalt by weight, forms an extremely powerful magnet. More recent applications of the metal involve the coating of missile cones and jet engine fuel nozzles.
Along with palladium, the metal absorbs large volumes of hydrogen, retaining it at ordinary temperatures but desorbing it at red heat.
The fact that the absorbed hydrogen is extremely reactive suggests that it is present either as atomic hydrogen or as a very reactive platinum hydrogen compound or complex. In finely divided form platinum is an excellent catalyst; about half of the annual production of the metal serves this purpose, most of it in the petrochemical industry. Platinum is also used as a catalyst in the contact process for the manufacture of sulfuric acid from sulfur dioxide and oxygen.
There is much current interest in the application of the metal as a catalyst in fuel cells and in catalytic converters as anti-pollution devices for automobiles. In the latter instance a suitable form of platinum will catalyze the oxidation of carbon monoxide to carbon dioxide and will
convert nitric oxide to nitrogen and water.
These last two points are of vital importance, as I will demonstrate these two markets are indeed the driving forces behind the current bull market.
A bull market that may see platinum trading at over $1,000 an once in the near future.
The push for zero emission vehicles by 2010.
As some of you may have seen on the news. Bill Clinton has been behind a move to ensure that a large percentage of vehicle in the United States, meet zero emission standards in the not to distant future. This is a trend soon to be followed by most developed nations. At present, the
only viable technology emerging to achieve this is in the area of solid state fuel cells.
Developments in this technology recently, have revealed that solid state fuel cells may also have applications way beyond the automotive field. Shortly we may see these cells being used commercially in mobile phones,laptop and palmtop computers and even household electricity generation.
In short, this fuel cell technology has the potential to turn the world?s current energy industry on its head. To give you some idea of it?s potential, a fuel cell the size of your current laptop battery could potentially provide up 100 hours of use, as opposed to the 5 or 6 hours
currently achievable. Your mobile could have 1000 hours standby time.
What is a solid state fuel cell? I?m glad you asked.
Instead of returning an electric charge that was stored in it, like a battery, a fuel cell generates electricity by oxidising fuel. The main allure of fuel cells is their
ability to store vast amounts of energy in hydrocarbons just like biological systems. Living things get energy from hydrocarbons -- and likewise without combustion. To continue the biological analogy, since the only waste products are carbon dioxide and water, Cells will "breathe" out
these innocuous compounds much as animals do.
As we already know, the generation of energy by clean, efficient and environmentally friendly means is now one of the major challenges for engineers and scientists. Fuel cells convert chemical energy directly into electrical work, and are environmentally clean, efficient and have the
potential for development to a sufficient size for applications in commercial electricity generation.
The Solid Polymer Fuel Cell in particular, shows great promise as a fuel cell for vehicles. Because it is a low temperature cell, the electrodes need a platinum catalyst to promote the reactions.
The leading supplier of the SPFC is the Canadian company Ballard Power Systems, and one of their most exciting developments has been the operation of fuel cell powered buses on the streets of Vancouver. Such has been the success of the programme, in which the fuel cell powered bus at least matched the performance characteristics of its diesel
powered counterpart - but with zero exhaust emissions and far greater fuel efficiency - that pre-commercial prototype buses are now operating in North America These 40ft buses carry up to 60 passengers and are powered by 275 HP fuel cells, each with a range of 400 km. Once these trials are finished, the intention is that commercial production will begin 2000.
As you can see from this last fact, the technology does work. We are now at the apex of it?s development. And platinum is the core material required to make the fuel cells work.
Until now a platinum-ruthenium alloy has been the best known catalyst for fuel cells. However a new catalyst, an alloy containing platinum, ruthenium, osmium, and iridium, is between 40 percent and 100 percent better, depending on the power demand on the cell and is particularly good under high current/high power conditions, researchers say. So for
high energy requirements, we can see that demand can only grow for these sister metal of platinum.
What has added an even more exciting twist to this whole story, was the revelation that Bill Gates, the worlds richest man, had recently started investing money in companies involved in the development of fuel cell
technology. This sent many stocks in the related field skyward, as investors tried to buy a share of this exciting new technology.
As you can see, the arguments in favour of this metal are great. We are not seeing a speculative bull market, but one driven by a real commercial need for the metal.
When we add this new shift in demand to the current high demand already required for the production of catalytic converters, we start to see a potentially very powerful increase in demand for many years to come.
For the past few years, Russian stockpiles of platinum have been meeting the increasing demand, however they have recently stopped shipping the metal, which has also added to the price rise. It is as yet unknown whether the Russians are engaging in price manipulation, or have actually
sold off most of their stock piles.
How do we make money from it?
Well if you?re brave enough, you can get maximum exposure to platinum by buying futures contacts directly over the metal. However if you?re not up for that, you can gain exposure through a couple of mining companies on the ASX.
Some of these are APU, AQP and ZIM.
ZIM is of particular interest because it has a different exposure to platinum. There are not currently mining the material, but are reported to be sitting on the worlds largest unmined deposit - a reported 100 million
ounces of platinum and 60 million ounces of palladium. While it has yet to be established whether this deposit is feasible for extraction, the ever rising price of the base metal means that at some point it is bound to become profitable.
All in all, it?s my opinion that when you combine ever increasing commercial demand with limited supply and add bullish speculative pressure, you set the stage for a powerful and prolonged bull market. In this case I believe platinum has the potential to climb much higher than
it?s current price, and I see no reason why it could not reach $1000 an ounce in the next few years. Twice it?s current price today.
Regards
Runningbear |
