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The Sc players are dependent on one another to the extent that at least 2-3 must make it to production for the market to develop. This certainly is relevant to this board given the extent that Sc will determine Niocorp's profitability. The three that have been mentioned recently are the most likely in my opinion. CLQ will likely be the first to production. NB has the second best chance of getting to that point, IMO. I don't see SCY going to production as a scandium pure play until others have proven the viability of the market.
I don't expect anything in August.
Assuming that Congress is yet again unable to pass a budget for FY'19. I don't expect any financing news until we start seeing the appropriation bills getting signed.
The recommendations from the Senate Committee on Energy and Natural Resources should give us insight into what to expect in an appropriations bill. Funds for a one time purchase seem to be a possibility. Reserves for a loan guarantee are another. Either way, the earliest you would see an appropriation bill would be late September, but if history is any indicator they are more likely to come in a series over a number of months.
The article discards Niocorp based solely on the premise that CBMM will not allow another market niobium participant.
Most reports, including SRK's analysis in the FS, indicate that CBMM welcomes other participants to reduce political risk to niobium and increase usage. Also, CBMM is in the process of an expansion that could increase their production by 50,000 tpa. Niocorps projected 8,000 tpa would have minimal effect on CBMM's global market share but should provide a tad more security to the market. CBMM should easily still supply over 80% of the market.
This doesn't even consider the political climate in the US that at this point appears to see domestic supply for these critical materials not just appealing, but necessary.
I have serious concerns about Niocorps scandium projections. Outside of the capex, I have very few concerns about the niobium source.
This only works if IBC has a similar deal to sell the alloy. They aren't large enough for their backing to have the same impact as a ThyssenKrupp or CMC.
Yes. There are numerous places in the FS where SRK recommends a scandium offtake.
I’ve been struggling with the comment that $500/kg compares with $1500/kg. I found the answer in section 4 of the FS. I suggest reading it. Cleanteq uses 10tpa at $1500/kg as the base case. They predict it will take a price of $750/kg at full output to create a sustainable market. This is even lower than SCY.
I still don’t care about the daily swings. I’m very happy with my entry point. This news is no surprise and only emphasizes the irrationality of the market.
Your previous post did give me a chuckle. Do you have a source for the $500/kg price or an IR communication you can copy and paste?
I googled Deutsche Bank and scandium and only got a few relevant hits. One was LCP making the same $500/kg claim on the NB board. The other allowed me to reminisce.
Element 21 was a company on my watch list over 10 years ago. They made scandium aluminum alloy golf clubs and fishing rods. Even with some positive product reviews, they never took off and now go by the name American Rare Earth & Materials (AREM). There is a board on ihub for them. Just an interesting anecdote. I may do a little more diligence on them tomorrow, but for now it seems my decision not to invest 10 years ago was a sound one.
This is all from the same shaky “investors news network” source, is exactly what I’ve said, and only reinforces my point. Nobody has disputed current pricing. There is limited data on it, but the data available is cited by many reputable sources.
The investor news article you are pulling this from contradicts itself. It attaches two different prices to SCY. These prices are explained on their site and I’ve explained the SCY projections ad nauseum. If you are this caught up in the subject, I challenge you to find one reputable source that agrees with Niocorps long term projections that is not connected to the company or Matheson.
EDIT: To make this as black and white as possible, SCY agrees current pricing for scandium oxide is between $3k-$5k, depending on purity. SCY believes that in order for the market to go from 15tpa to ~300tpa, the price point will have to be around $2k.
Meh. Down a cent or two on low volume. It was overvalued prior to the FS in the current state. Expectations were too high. Don’t know the average share price for you and others, but I like the chances for a relatively quick rebound right here for a 2x-3x return. With Friedland’s backing, the fact that they bought the autoclaves prior to the FS, and the merits of Co and Ni, I’m pretty confident that the discussions within the board room are still pretty positive. No need to overshoot on the FS and leave yourself exposed when all other systems are a go.
Your post is not relevant to the one in which you replied. I said claims, not comparisons. I have not debated anyone’s opinion on this matter, except perhaps my single post exchange with walterc. My contributions today have all been based in fact and every single one is citeable from a reputable source.
When someone claims that a company made claims that they did not, “wrong” is exactly what they are. I did not choose $2000. That is the number chosen by another potential scandium producer. I didn’t even claim it was comparable, as I pointed out the differing purity levels. You can infer from my posts whatever you’d like, but the only point that was made was that the claim for $3-$5k was factually incorrect and Niocorp remains the only company projecting pricing in this range. I didn’t say they were wrong, I didn’t say they are right. I said their opinion is in the minority of a small group.
The false claim that Scandium International believes in future pricing at $3k-$5k. It's incorrect. I pointed it out, along with their pricing assumptions and appropriate caveats, and then the flood gates opened.
This post is actually the basis for my concern. Not counting those internal to Niocorp or those working under Andrew Matheson at OnG commodities, to my knowledge this pricing was only set by two people. Andrew Matheson provided the study. Grant Malensek reviewed it.
Contrary to a commonly held belief on this board, all 15 qualified persons in the feasibility to study do not each review every section. The market studies are in section 19 of the study. Malensek was the only one that reviewed this section.
In fact, the Ontario Securities Commission specifically requested disclosure on the reliance of outside experts in the revision. Matheson's name is the only one listed in the section 3 disclosures. Also in section 3 is the disclosure "Niocorp's products may not command special chemical pricing."
In regards to your second point, I don't disagree with you, but again that is part of the basis for my concern. Niocorp, Scandium International, and Cleanteq are all pursuing alloy development with different partners. IBC is to Niocorp as Eck Industries is to Scandium International as Chinalco is to Cleanteq.
In other words, all three companies have extremely similar strategies, believe the scandium market growth potential comes from the same industries, and yet one of them is an outlier with their pricing predictions.
Here's a link to a video from SCY's CEO. I posted this a while back. If one simply read a transcript of this interview they could be lead to believe it was Mark Smith instead. The strategies are that similar.
Further to this, the article goes on to mention the $2000 price from the FS that I cited:
You guys still don't get it. Everyone here understands Niocorp's "special chemical" position on scandium. Two other likely producers, both aiming at the same industries, do not share these views. Except for pricing, all three of these companies have very similar outlooks and strategies for the market. I'm not trying to debate this. The scandium market does not currently exist in a meaningful volume and only time will tell which predictions are more accurate.
I will not, however, sit back and watch others make false claims about other's plans and predictions in order to prop up NB. One poster purported that Niocorp planned a higher purity than another. This is provably false. A post this morning claimed SCY priced scandium in the same range as NB. Also provably false. If you are that confident in the pricing assumed by Matheson and NB, then why do so many on this board feel the need to continually make false comparisons? Why not call out these false claims and let Niocorps predictions stand on their own merits?
You made the claim that SCY puts scandium pricing between $3000-$5000. This is not true and is a gross misrepresentation of their opinion on scandium pricing.
See douginil's post on Sc pricing. That is a perfectly reasonable position to take.
It is not reasonable to misconstrue the opinions of other producers of scandium. SCY has one opinion, CLQ has a less optimistic one, and NB has the most optimistic. Time shall tell who's predictions are most accurate.
The last quarterly reported indicated operating expenses for the first three months of the year averaged to $450k/month and that it was anticipated the company would need $6MM to fund the next 12 months of activities so $500k seems like a more accurate "burn rate".
This was one of my previous posts. The quarterly report I was referring to was Jan-March. The year end report (the FY ends June 30th for them) should be out soon. I was checking for it earlier when I noticed the site was down. It will give us a better understanding of current cash on hand and needs for the rest of the year. I'm also hoping for some details on the contracts with Nordmin, Rockwell, and Rockies Express to see how they are being compensated, but I don't expect to see that.
Niocorp.com is down.
The server is temporarily unable to service your request due to the site owner reaching his/her bandwidth limit. Please try again later.
Probably need to update the bandwidth with the host, but seems maybe web traffic has been a lot higher this month.
Nobody disputes current pricing at 15tpa. The assertion was that SCY believes this is valid long term pricing. They do not believe this for the reasons listed in their feasibility study.
These are not my numbers. They are direct from another potential scandium producer, which seems to me to be a rather credible source.
The price assumption in the feasibility study is US$2,000 per kilogram (kg) of scandium oxide product, as an average price covering all product sold, over various product grades. Current market pricing, such as that can be established, is substantially above these levels based on small unit quantities and varying grades. This product pricing benchmark applied in the feasibility study remains the same as was applied in the 2014 Preliminary Economic Assessment ("PEA") on this Project, and for the same reasons. In order to encourage a viable, over-subscribed and vigorous scandium market, across numerous applications, product suppliers will need to provide for adequate supply of quality product, available from trusted jurisdictions, at prices lower than product trades for today.
http://www.scandiummining.com/s/nyngan.asp?ReportID=749853
Sims has already indicated that any purchase by the DoD would be a one time purchase. That is simply how their stockpiling works. A purchase agreement for the initial 100 tonnes of Sc is plausible. A PO for a portion of the initial Nb that is not already claimed by ThyssenKrupp or CMC is also plausible.
Offtake agreements with the DoD are not plausible.
This is not an accurate statement. Current pricing may between $3000-$5000 with 15-20 tpa globally, but SCY does not view that as an accurate long term prediction with a significant increase in productions. You can't assume bulk pricing is the same as buying by the gram. This is direct from their FS:
The price assumption in the feasibility study is US$2,000 per kilogram (kg) of scandium oxide product, as an average price covering all product sold, over various product grades. Current market pricing, such as that can be established, is substantially above these levels based on small unit quantities and varying grades. This product pricing benchmark applied in the feasibility study remains the same as was applied in the 2014 Preliminary Economic Assessment ("PEA") on this Project, and for the same reasons. In order to encourage a viable, over-subscribed and vigorous scandium market, across numerous applications, product suppliers will need to provide for adequate supply of quality product, available from trusted jurisdictions, at prices lower than product trades for today.
In addition to limited publically available price quotes for scandium oxide, the feasibility study notes two other reference points on the US$2,000/kg price assumption. The Company has an offtake agreement in place, for 7,500 kg/year (3 years), with pricing being supportive of the pricing assumption in the feasibility study. The customer is a knowledgeable alloy group, with longstanding interest in aluminum-scandium alloys. The feasibility study price assumption is also supported by a recent, independent marketing report that examines the 10 year scandium supply/demand outlook, and includes scenario-based 10 year price forecasts. The details and contents of this market outlook report will remain confidential, but select information will be included in the feasibility study. Both of these reference points support that the scandium value proposition for customers/consumers is valid at this price level.
It should be noted that SCY plans to produce varying grades between 98%-99.9% purity. It should also be noted that they finished their FS over two years ago, need just $87.1MM, and have still been unable to obtain financing.
Agree on all three posts. I’ve never had (much) of a doubt about CLQ, just didn’t see the value at over a buck. This company will break ground, and now is an attractive entry point.
Where I disagree with you is in government involvement, and that is what I think will carry the other company through.
I’m not sold on Sc from anyone. In the case of CLQ it is abundantly clear that Ni and Co make for a profitable mine. In the case of NB, I think the current strategic importance of Nb is sufficient for financing.
Are you referring to the $25MM Mark referred to last fall? He mentioned at that time $25MM would be needed to advance to detailed engineering in order to let the engineering proceed without interruption. Nordmin has since been hired for the detailed engineering, but the question about where the $25MM comes from has not been resolved.
I agree with the second half of your post. Riggall commented that if CLQ does not go to production then many other junior minors will fail as well. They must succeed if you want any other prospective Sc producers to move forward as well.
I just think you are giving the US government too much credit and looking too deep into this memo. I read it as nothing more than an olive branch to one ally that the US hasn’t pissed off recently.
I’m not following you. Please clarify.
Here's the official White House memo on the event:
https://www.whitehouse.gov/briefings-statements/president-donald-j-trumps-meeting-australian-prime-minister-malcolm-turnbull-strengthens-united-states-australia-alliance-close-economic-partnership/
And the relevant section:
The two leaders discussed the President’s plan for financing and building America’s infrastructure. The Prime Minister noted that Australia’s federal and state governments, and its private companies and pension funds, are interested in working with the United States to support building America’s next generation of infrastructure.
The United States and Australia plan to encourage best practices, spur investment, and develop policies to support high quality infrastructure in the United States, Australia, and third countries, in particular in the Indo-Pacific region.
The cooperation of strategic partners can open new worlds of technological development using materials that are lighter, more versatile, or more conductive to open up new manufacturing opportunities, in defense and aerospace, information technology, telecommunications, energy and medicine. The United States and Australia agreed to work together on strategic minerals exploration, extraction, processing and research, and development of rare earths and high performance metals to sustain the jobs of today and develop the jobs of tomorrow.
I guess you can interpret that however you would like. It mostly reads like a bunch of fluff to me, and I certainly wouldn't jump to any conclusion that it excludes support for domestic mining of critical materials.
Furthermore, I highly doubt Trump knows about Sc or any of the specific junior miners planning to produce it in a pure form. I know Jim Sims at Niocorp has had discussions with multiple members of congress, but I doubt any of these discussions have made it to Trump. It is likely in Niocorps best interest that it stays that way.
I would agree with that. The point is there was no "deal" and we shouldn't spread news as if there was.
I'm not here to make friends. I'm here to discuss the pros and cons of various investments. When looking at a company in an emerging market, it seems logical to me to also examine the other companies going after the exact same market.
The article is from February and indicates that Trump and Turnbull have agreed to cooperate on the development of critical materials.
That's a far cry from a deal by the government, and is likely beneficial to junior miners in both countries, assuming the agreement actually amounts to real legislation.
http://www.cleanteq.com/wp-content/uploads/2016/12/9772_Clean-Teq-TECHNOLOGY_17-1-17.pdf
Pilot plant has demonstrated success. Product has been produced and sent to potential customers as well as partners to produce alloys. This back yard enterprise has a multi-billion dollar backer and to date their scandium strategy has been extremely similar to Niocorp's, with the exception being they have indicated a desire to ramp up Sc production over time as the market develops.
Successful completion of scandium recovery was proven in 2015.
http://clients3.weblink.com.au/pdf/CLQ/01658575.pdf
You are ignoring the only reason why this subject came up again. CleanTeq and Niocorp both intend to produce 99.9% purity. It was asserted that CleanTeq had a lower purity at 99.9%. This is not true. Niocorp has never indicated they have any intention of producing a product with higher purity.
The assertion was that CleanTeq was offering a lower purity than Niocorp. They are not. Both are offering 99.9%. None of us know what, if anything, is different in the remaining .1% from the different sources. That is all.
The two companies are virtually dependent on one another if a Scandium revolution is to take place. This is not a competition but a comparison. Cleanteq has a very good story for the battery market alone and may actually be a catalyst for institutional investment in Niocorp. Major manufacturers are not going to let their products become dependent on Sc from a single global source of the “allies”.
There is no source that indicates the US made a deal with Cleanteq. That assertion seems rather absurd. Cleanteq has plans to ramp up Sc production if the market forms, but is otherwise completely sustainable as a highly profitable mine based on nickel and cobalt alone.
Share price as a metric is completely worthless on its own. How does the market cap compare? Also, what did NB’s share price do in the month after the FS release.
I fail to understand the infatuation with the day to day share price, or even month to month share price of these junior minors. If you are day trading penny stocks, specifically thinly traded ones like NB, then more power to you. I’ll keep looking for news, reading actual filings, and doing my best to read in between the lines of corporate speak to make investing decisions in the high risk portion of my portfolio.
Smith says they were chosen out of hundreds. He did not say they were the only one, nor who may or may not have turned down an invite. The other speakers can be found at the link that Trofee previously provided. This link was also embedded in the link to globe news wire link you posted.
https://www.energy.senate.gov/public/index.cfm/hearings-and-business-meetings?ID=2D5F4BAB-365C-4D91-88C9-2426057E869B
I certainly do. Any news on Scandium is valuable to the due diligence for investors in NB. I can’t make any other comments on Trump’s policies and motives without violating the TOS.
So is Niocorp’s.
From the written testimony:
The Army Corp's 408 program office stopped work on the 408 permit for the project in February 2018 on the
basis that a fee agreement with the company was needed to continue working. The fee agreement was never
produced by the Corps, and the Corps did not complete any additional work on the 408 permit. This was a
partial driver in the Company's decision to remove from the project's design those features of the project that
triggered the 408 permit.
I brought up the possibility of issues with this permit in my criticism of the letter from Governor Ricketts last year, and suspected again that it was an issue when the elimination of the waterline was announced. I'm glad the company was able to work around this with another viable solution and hope it does not increase the CAPEX.
It will be interesting to see which, if any, of Jim's suggestions come out of the committee.
It’s not without reason. Their FS results did not meet expectations, but was likely put together with very conservative estimates. It also up well over 10% in the last week.