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This is excellent news! This is what will get Trump's attention!
That is a possibility.
I agree.
I like this line: "We need niobium, Mr. President, yet we don' t mine a single pound of it in the U.S. today. Nebraska wants to change that, and as rapidly as possible.”
Nebraska Governor Pete Ricketts Nominates the Elk Creek Project to the White House as a “High Priority National Infrastructure Project”
CENTENNIAL, Colo. (July 31, 2017) –Governor Pete Ricketts (R-NE) has nominated the Elk Creek Superalloy Project as a “High Priority Infrastructure Project” in response to the White House’s January 24, 2017 Executive Order entitled “Expediting Environmental Reviews and Approvals For High Priority Infrastructure Projects.”
In this letter to the Administration, Governor Ricketts made these points:
“Key to the success of a national infrastructure re-building is utilizing as many American-made materials as possible - particularly the high strength steels that form the backbone of America's transportation, manufacturing, and defense infrastructures. The Elk Creek Superalloy Project can help the U.S. produce American-made "super steels" for infrastructure projects across all 50 states. The Project will establish the first-ever production in America of niobium, a metal that helps to make High Performance Steel (HPS). These super steels are increasingly used in highway bridges and in virtually all mega- steel infrastructure projects in order to reduce corrosion, lengthen lifespans, cut costs, and reduce environmental impacts. American-made HPS steel c an help highway bridges last in excess of a century. That will reduce taxpayer costs and strengthen safety… We need niobium, Mr. President, yet we don' t mine a single pound of it in the U.S. today. Nebraska wants to change that, and as rapidly as possible.”
On Behalf of the Board of Directors
“Mark Smith”
Mark Smith
Executive Chairman, CEO and Director
I'm not sure why this is so hard for some to understand...
Great post Walter, thanks for sharing that.
I like his connection to the DoD, that is Huge! Things are lining up very nicely.
Face it, you got told by Jim, who is much more knowledgeable than you. Look at his linkedin, very impressive.
Anyone else notice this?
The pricing for the 99.9% pure Sc2O3 product we intend to make was estimated by an independent scandium market expert, Dr. Andrew Matheson, a leading authority on scandium alloys and scandium markets. Further, as an accomplished specialty alloy metallurgist who also works in conjunction the U.S. Department of Defense, Dr. Matheson is highly knowledgeable in scandium alloy development and in the specific applications that are likely to benefit most from the revolutionary advantages that Sc2O3 can deliver. Such knowledge is critical to accurately forecasting pricing. Dr. Matheson conducted a very detailed market assessment and supply/demand analysis to arrive at his pricing forecast. We had very little input into his analysis other than to disclose the product we intend to make and our production targets. The independent experts who wrote our Feasibility Study plugged in Dr. Matheson’s numbers for Sc2O3 pricing into their economic model.
Also from Jim:
The pricing for the 99.9% pure Sc2O3 product we intend to make was estimated by an independent scandium market expert, Dr. Andrew Matheson, a leading authority on scandium alloys and scandium markets. Further, as an accomplished specialty alloy metallurgist who also works in conjunction the U.S. Department of Defense, Dr. Matheson is highly knowledgeable in scandium alloy development and in the specific applications that are likely to benefit most from the revolutionary advantages that Sc2O3 can deliver. Such knowledge is critical to accurately forecasting pricing. Dr. Matheson conducted a very detailed market assessment and supply/demand analysis to arrive at his pricing forecast. We had very little input into his analysis other than to disclose the product we intend to make and our production targets. The independent experts who wrote our Feasibility Study plugged in Dr. Matheson’s numbers for Sc2O3 pricing into their economic model.
From Jim:
Those who suggest that there is a “commodity price” for Sc2O3 clearly don’t understand that Sc2O3 is not a commodity product: it is a specialty chemical. There is a world of difference between commodities and specialty chemicals, and to speak of commodity pricing for Sc2O3 betrays a fundamental lack of understanding of specialty chemical (spec chem) products and spec chem markets. The NioCorp team has long experience in both the spec chem and commodity metals industries, so we understand these differences well.
In the spec chem industry, pricing by customer can differ dramatically for the same purity of product, such as 99.9% Sc2O3 (what we call “three nines” scandium, or 3Ns Sc2O3, for short). This is driven by a number of factors, including the following:
Different Product Specifications: the specifications for a 3Ns Sc2O3 material can be very different between customer A and B, even though both products are the same purity (99.9%). Often, this is due to the maximum allowed impurity levels that are present in the 0.1% of the product that is not Sc2O3. For example, Customer A might have a list of 5 elemental impurities that cannot exist above a certain level, typically measured in parts per million, or ppm, in their 3Ns Sc2O3. By contrast, Customer B may have a specification requirements that lists 30 or more elemental impurities that cannot be present above a certain ppm in the Sc2O3 they use. While both products are 3Ns Sc2O3, the differences between these materials can be substantial. One can be much more difficult to make than the other, as it can require more purification steps (e.g., chemical “washing” or “polishing”) to hit the product spec. It also can command very different pricing as a result.
Application-Specific Value. In a number of applications, Sc2O3 enables revolutionary performance and value to manufacturers. The use of “revolutionary” as an adjective here is appropriate; if you research the potential value and cost savings that Sc2O3 delivers to any of a number of industries (as we have done), it quickly becomes apparent that the value proposition of this specialty chemical is enormous. The pricing of our 3Ns Sc2O3 spec chem product will incorporate a portion of the added value it will deliver to our customers. If, for example, our Sc2O3 products helps a manufacturer save an estimated tens of millions of dollars per year – savings it could not achieve but for the in-spec 3Ns Sc2O3 we provide to them through our reliable supply chain – that fact will have an impact on the pricing of our material.
Supply Chain Security. Meeting a customer’s detailed product specifications can be a lengthy and difficult process, and start-up junior miners who have limited experience in producing spec chem products often learn this the hard way. Once a spec chem producer can demonstrate to a customer that it can consistently meet the customer’s spec, the customer is inclined to stay with that producer – particularly if there are limited supply alternatives, as is likely to be the case for Sc2O3. Spec chem customers tend to be “sticky” customers, which is very good for a producer that can meet a product spec. Given the cost of supply interruptions for a spec chem, a manufacturer will want to ensure the security and stability of its upstream supply chains, and this can factor into the pricing the customer is willing to pay for material produced in such supply chains.
Supply Chain Risk Mitigation. This is closely related to factor #3. Manufacturers not only want upstream suppliers that can meet their product specifications, but they also prefer those suppliers who produce materials in locales or nations that present minimal country or political risk. Materials produced in nations such as the U.S. are considered to have very low country risk as opposed to those who produce in nations with less stable political or governmental regimes. (You might want to Google recent developments in Tanzania, for example, regarding how country risk can influence the security of supply chains for products such as Ferroniobium, which we also will make at Elk Creek).
Robust Production Capacity. Another factor that can increase the market value of a specific producer’s Sc2O3 is production capacity. Independent estimates of global market demand for Sc2O3 peg that demand into the hundreds of tonnes per year. Producers with relatively larger production capacities are often seen by downstream manufacturers as more reliable suppliers, given that they have the ability to ramp production up in the event a customer’s demand grows. At present, NioCorp’s planned production capacity will be among the largest in the world. That provides us with added flexibility in negotiating pricing with customers who may wish to increase supply purchases as demand for their own products grows.
There is another issue to keep in mind with regard to spec chem markets: companies that make spec chem products rarely disclose the pricing they can command for the various chemistries they make. This is a fundamental tenant of the spec chem industry: you do not publicly disclose the price of the spec chem you make for Customer A versus the price you can command from Customer B. This is just good business practice.
That said, current pricing for higher-purity levels of Sc2O3 range $3,000 - $5,000 / kg, as has been noted by many observers. One can purchase Sc2O3 at even lower prices, but that is almost certainly for lower-grade material that probably needs additional processing, at additional cost, in order to meet a particular manufacturer’s product specifications.
All of this may help to explain why it doesn’t make sense to say that the price Sc2O3 has been set at ~$2,000/kg by junior miners who have executed non-binding letters of intent on their Sc2O3. There is no “commodity price” for 2Ns Sc2O3, or 3Ns Sc2O3, or 4Ns Sc2O3. Of course, in the wild kingdom of the internet, where anonymous voices can claim industry “expertise” without a day’s worth of experience in the spec chem manufacturing, sales, or customer service sectors, there will always be those who speak authoritatively about how these markets work, albeit inaccurately.
In short, there clearly is unmet demand for Sc2O3, and NioCorp will be well positioned once Sc2O3 production begins in Nebraska to meet some of that demand. In fact, the demand we forecast well exceeds NioCorp’s current plans for Sc2O3 production capacity, which is why we are bullish on multiple producers of Sc2O3 eventually coming online. While we are working with prospective Sc2O3 customers now, our business plan and project financing strategies do not require that an offtake agreement be in place for Sc2O3 yet. Our goals are to serve our customers’ needs while maximizing sales revenue for this revolutionary material. The sales agreements we intend to execute on Sc2O3 will be finalized when the time is right to achieve both goals.
I hope this background is helpful.
Jim Sims
VP of External Affairs
NioCorp Developments, Ltd.
+1.303.503.6203
Again LCP.... Read this post that I am replying to. If you can't read it, get someone to help you read it. Jim Sims debunks your argument completely. You can not compare apples and oranges. So stop trying to on this board.
It is really clear what it says:
“Domestic production of Scandium. Given the planned initiation and production in the United States within the next 5 years of as much as 100 metric tons of Scandium, the committee directs the Secretary of Defense to provide a briefing on the potential defense and industrial uses of Scandium to the congressional defense committees by December 1, 2017.”
NioCorp is the only current prospective producer of scandium in the U.S. that has announced plans to produce this amount of scandium on an annual basis. As outlined in the Company’s recently released Elk Creek Superalloy Project Feasibility Study, the Company plans to produce approximately 103 tonnes of scandium product annually. NioCorp’s annual scandium production is estimated to exceed total global scandium production by a factor of at least five, and will potentially position the U.S. as the world’s leading producer of scandium.
On page 288 of the Committee Report accompanying the NDAA, the SASC also included this legislative language:
“Fiscal stability of the National Defense Stockpile. ... Additionally, the committee strongly encourages the Department to make use of existing authorities under Section 303 of the Defense Production Act (50 U.S.C. 2093) to enter into commitments to purchase strategic and critical materials required to meet the defense, industrial, and essential civilian needs of the United States from domestic producers anddomestic producers that the Department believes are likely to initiate commercial production of such materials within the next five years.”
This last part: "Fiscal stability of the National Defense STOCKPILE."
That's right, STOCKPILE.
"The committee strongly encourages the Department to make use of existing authorities under Section 303 of the Defense Production Act (50 U.S.C. 2093) to enter into COMMITMENTS TO PURCHASE STRATEGIC AND CRITICAL MATERIALS REQUIRED TO MEET THE DEFENSE, INDUSTRIAL, AND ESSENTIAL CIVILIAN NEED OF THE UNITED STATES FROM DOMESTIC PRODUCERS AND DOMESTIC PRODUCERS THAT THE DEPARTMENT BELIEVES ARE LIKELY TO INITIATE COMMERCIAL PRODUCTION OF SUCH MATERIALS WITHIN THE NEXT FIVE YEARS."
We are the only prospective Scandium producer in the U.S. planning to start production in the next five years. YES, this is talking about US.
I agree Landmark!
Actually, I think Mark said no less than a dozen interested parties.
I remember hearing a dozen or so as well from management.
"The legislation also “strongly encourages” the DoD to consider entering into commitments to purchase strategic and critical materials from U.S. domestic producers that are not yet in production but which the DoD believes are likely to initiate production of such materials within the next five years."
Yes, that means us. Very good news indeed!
I believe this has been mentioned in conference calls and interviews.
"Domestic production of Scandium. Given the planned initiation and production in the United States within the next 5 years of as much as 100 metric tons of Scandium, the committee directs the Secretary of Defense to provide a briefing on the potential defense and industrial uses of Scandium to the congressional defense committees by December 1, 2017.”
NioCorp is the only current prospective producer of scandium in the U.S. that has announced plans to produce this amount of scandium on an annual basis.
This legislation was written just for us! Niocorp must have something in the works, or this would not be a PR!
Fantastic news!! I have been waiting to hear something like this.
NioCorp Praises U.S. Senate Armed Services Committee For Approving Legislation Regarding U.S.-Produced Scandium
CENTENNIAL, Colo. (July 20, 2017) – NioCorp Developments Ltd. (“NioCorp” or the “Company”) (TSX: NB; OTCQX: NIOBF; and FSE: BR3) today praised the U.S. Senate Armed Services Committee (“SASC”) for its recent approval of legislation requesting a U.S. Department of Defense (“DoD”) briefing on the potential strategic value of U.S.-produced scandium. The legislation also “strongly encourages” the DoD to consider entering into commitments to purchase strategic and critical materials from U.S. domestic producers that are not yet in production but which the DoD believes are likely to initiate production of such materials within the next five years.
Under the leadership of SASC Chairman Senator John McCain (R-AZ) and Senator Jack Reed (D-RI), and with support from both Republican and Democratic members of the SASC, the Committee recently approved the following language on page 287 of the Committee Report accompanying the Fiscal Year 2018 National Defense Authorization Act (“NDAA”), which is publicly available here: https://www.congress.gov/115/crpt/srpt125/CRPT-115srpt125.pdf
“Domestic production of Scandium. Given the planned initiation and production in the United States within the next 5 years of as much as 100 metric tons of Scandium, the committee directs the Secretary of Defense to provide a briefing on the potential defense and industrial uses of Scandium to the congressional defense committees by December 1, 2017.”
NioCorp is the only current prospective producer of scandium in the U.S. that has announced plans to produce this amount of scandium on an annual basis. As outlined in the Company’s recently released Elk Creek Superalloy Project Feasibility Study, the Company plans to produce approximately 103 tonnes of scandium product annually. NioCorp’s annual scandium production is estimated to exceed total global scandium production by a factor of at least five, and will potentially position the U.S. as the world’s leading producer of scandium.
On page 288 of the Committee Report accompanying the NDAA, the SASC also included this legislative language:
“Fiscal stability of the National Defense Stockpile. ... Additionally, the committee strongly encourages the Department to make use of existing authorities under Section 303 of the Defense Production Act (50 U.S.C. 2093) to enter into commitments to purchase strategic and critical materials required to meet the defense, industrial, and essential civilian needs of the United States from domestic producers anddomestic producers that the Department believes are likely to initiate commercial production of such materials within the next five years.”(emphasis added).
If enacted into law, this language could result in the DoD entering into forward purchase agreements for strategic and critical materials such as scandium, ferroniobium (FeNb), and others from prospective producers that are not yet into production. If the DoD elects to exercise such authorities and enters into offtake agreements with pre-production companies, it would mark a significantly more aggressive approach by the DoD in seeking to encourage greater domestic production of critical and strategic materials.
As a critical and strategic material, FeNb is considered to be of such importance that the DoD and the Congress agreed in the FY2014 NDAA that the National Defense Stockpile should purchase and store FeNb in the Stockpile in the event of future emergencies. Scandium is another critical and strategic material that is analyzed by the DoD on an ongoing basis as part of the DoD’s “Strategic and Critical Materials Report on Stockpile Requirements,” although the DoD and Congress have to date not directed that scandium be purchased for storage in the Stockpile.
“We were pleased to see the Republican and Democratic leaders of the U.S. Senate Armed Services Committee put forward such strategically innovative ideas regarding greater domestic production in the U.S. of strategic and critical materials,” said Mark A. Smith, Executive Chair and CEO of NioCorp. “The Committee clearly wants to help the U.S. Defense Department use all of the policy tools in its toolbox to encourage and strengthen supply chains for critical and strategic materials, especially those that can be produced domestically in the U.S.”
Mr. Smith added: “NioCorp looks forward to initiating the first-ever production in the U.S. of ferroniobium, and the first U.S. production of commercial scandium in decades, when our Elk Creek Project comes online.”
On Behalf of the Board of Directors
“Mark Smith”
Mark Smith
Executive Chairman, CEO and Director
# # #
Excellent post!
Private placement. Also, go around and ask 1000 people what Niobium or Scandium is, I doubt you will find one person.
Not all Scandium is created equal. You are trying to compare apples and oranges. You can not compare competitors without knowing the exact specs.
Lcp, read this post that I am replying to. It was made for you. Jim's remarks debunk everything that you have been posting about Scandium.
Are you calling Dr Andrew Matheson, a leading authority on Scandium, a liar?
Lcp, have you read Stark's response to you? He makes some great points in the post I am replying to. Care to comment on that??
Other potential mines do not matter. Even if all the potential Scandium mines are built, that is still not enough Scandium to meet the demand. All will get sold.
How could there be a Scandium war when there is much more demand than there is supply? Your reasoning makes no sense! More demand = name your price and get it.
You are not an expert on Scandium, but Dr Andrew Matheson is. It's a good thing he contributed to our FS. Cheaper Scandium is lower grade material that requires additional processing. Read Jim's reply, it is a sticky. His reply puts any argument about Scandium pricing to rest.
Industry professional? Is it professional to post attacks on message boards as a broker? Is that what "professional" brokers do these days? Is it professional to use fear mongering to get "clients" to invest in your stock picks? You line your pockets with others money. You try to push people around and tell them how to invest. You are no professional.
You are a broken record. Let it go. Read Jim's remarks, he explained it perfectly. You can not argue with what he said, it makes perfect sense. You are no expert on Scandium, that is evident.
Excellent post! My thoughts exactly.
Can we make this a sticky? With the headline Attn: lcp READ THIS before posting.
I agree 100% Landmark.
Great post! Lcp, you need to read this post! Apparently you missed it....
No thanks I would rather read our FS, with just as reputable firms behind it...
Of course Kaiser would say that, he is heavily invested in a competing Scandium venture. I take anything he says with a grain of salt. He is one person, with an opinion, just like you.
Well said.