Thanks to a hot molybdenum market and a highly respected CEO,...

Thanks to a hot molybdenum market and a highly respected CEO, Idaho General Mines’ moly projects gain more recognition.
Author: Dorothy Kosich
Posted: Wednesday , 04 Apr 2007
RENO, NV -

Idaho General Mines' new CEO, Bruce Hansen, a former Newmont Mining Senior Vice President, told investors during a conference call that Chinese moly production, the reopening of the Climax molybdenum mine in Colorado, and small moly operations will only generate "some excess supply for a short time."

Instead, Hansen suggested that 20 million to 25 million pounds of new moly supply will be required to meet world demand for steel and other products.

Hansen estimated that the initial capex for the project will range from $600 million to $700 million. He told investors that the mining company will finance the project through incurring 60 to 75% in debt with the remainder to be financed through equity. Among Idaho's new shareholders is Canada's Sprott Asset Management.

Molybdenum is used as an alloying agent in steel to enhance strength and resistance to wear and corrosion. It is also used in lubricants developed for high temperature and pressure applications. There are no known substitutes for molybdenum's unique properties, which is used in most of the present day super-alloys. The price of molybdenum oxide has gone from $3/lb to over $30/lb over the last couple of years due to the strong demand and short supply.