Tantalum and Cesium (data from various sources) +
some of my market observations over the last 2 years:
- The tantalum (Ta) market is increasingly becoming vertically integrated. Cabot Corp., in particular, is investing in mine developments to ensure: (i) available supply can adequately meet the growing demand and (ii) relative price stability in the market.
- Sons of Gwalia's Greenbushes mine is the largest tantalum (Ta) producer in the world and the largest and highest grade spodumene (Li) producer. SOGs current Ta supply contracts with Cabot Corp. and H.C Starck. (a subsidiary of Bayer Inc.) alone are worth US $350 million over 5 years. In 1998, Cabot Corporation completed a $30 million private placement in SOG to help it to expand its Ta production capabilities.
- Cabot Corp. has also acquired a 30% stake in the Morrua tantalum mine in Mozambique. Morrua is the only significant tantalum mine in Southern and Central Africa with 4.57 million tons of tantalum ore and surface dump reserves of 1.4 million tons. At an anticipated start-up cost of U.S. $27 million, annual sales are expected to be 350,000-400,000 lbs, with an average cost of recovered tantalum = U.S. $21 vs. contract prices starting at $43/lb rising by $1/yr thereafter.
- TANCO was acquired by Cabot Corp. in 1993. The company had exhausted its mineable reserves of Ta in mid-1992, but continues to produce up to 135,000 lbs of concentrate annually from tailings retreatment. Other production has included: spodumene on a contract basis for Corning Inc.(22,000t in 1996), montebrasite (400t in 1996), rubidium and cesium. In 1995, Cabot Corp. launched a new specialty fluids division with a U.S. $25-30 million investment in a cesium formate plant on site. Tanco accounts for 82% of known pollucite reserves worldwide. Since reserves only total 350,000t @ 23.3% Cs2O, new sources of supply may be required to meet longer-term demand for this rare mineral. Cabot Corp. uses cesium to produce cesium formate and cesium acetate - high temperature and high pressure drilling fluids ideal for deep offshore oil wells. It improves drlling efficiency (time and cost reductions) and is more environmentally friendly than other drilling fluids. Since HTHP offshore wells can cost up to hundreds of millions of dollars, the U.S. $6,000/barrel cost seems reasonable. Other uses of cesium include the bio-medical field, electronics and as a catalyst in the production of petrochemicals, organic chemicals, and sulphuric acid.
- Ta Grades and Mine Economics (see below): Ta grades are just as important as the size of a deposit. The Ta zone at Tanco was no question a ‘bonanza zone' - large and high grade. SOG's Wodgina mine in Australia is the first dedicated mine to Ta - the economics of 4.7 million tonnes @ 525 ppm must be favourable. SOGs Greenbushes mine is lower grade - but still the dominant source of world Ta production (726,000 lbs in 1997-98 or 1/3 of total world production).
SOG: Greenbushes Mine:
68,180,000t @ 0.0256% (.000256 = 256 ppm = 256 g/t) Ta2O5
= 38.4 million lbs.
SOG: Wodgina Mine:
4,730,000t @ 0.0525% (.000525 = 525 ppm = 525 g/t) Ta2O5
= 5.5 million lbs.
TANCO Pre-Production:
2,071,358t @ 0.216% (.00216 = 2160 ppm = 2160 g/t) Ta2O5
= 9.8 million lbs.
Avalon's Big Whopper:
7,081,700t @ 0.007% (.00007 = 70 ppm = 70 g/t) Ta2O5
= 1.1 million lbs.
Houston's Pakeagama Lake Property:
1. Tantalum-bearing aplites (0.07% Ta2O5) occur in isolated exposure on Pakeagama Lake could represent a 400 m extension of the pegmatite to the SE.
2. Pakeagama Lake pegmatite has several mineralogical and chemical characteristics that suggest the presence of a Tanco-type pegmatite system. This includes a highly evolved tantalum-rich oxide mineralogy...
3. The wall zone contains highest Ta and Rb values encountered to date; 1% Rb is highest bulk content for that metal yet found in NW Ontario. Small sample suite reveals Ta2O5 between 0.03 and 0.05%.
4. Concentrations of rubidium (mean 1.11%) and cesium (mean 0.83%) are highly anomalous and indicative of a complex type pegmatite system. This pegmatite system also contains pollucite, the only ore mineral for cesium... and indicates a high exploration potential for zones rich in cesium.
From the market information, its no surprise that analysts have stated that the discovery of new high grade cesium or tantalum reserves would likely attract the attention of Cabot Corp., Bayer Inc./H.C. Starck, Metallurg Inc., or others.
DRT |
