syngas multibagger potential can it clear 10c , page-11

Native Sulphur

It is anticipated that around 120,000 t.p.a. of native sulphur will be produced from the Syngas Project. Native sulphur is used in fertiliser production and is also a key component in sulphuric acid production - one of the world’s most widely used industrial chemicals. There is strong demand globally for native sulphur. Presently prices in excess of US$100 per tonne are being secured by producers for this commodity.

South Australia’s large agricultural sector results in a high annual consumption of native sulphur in fertilizer. The mining industry is also a major consumer of native sulphur and native sulphur derivatives, particularly Nickel Laterite operations, with several projects under development in South Australia and elsewhere in Australia.

A number of initial inquiries have been received on the purchase of the sulphur to be produced by the Syngas Project.


This was postwed when Sulphur was $100 per tonne.

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From waste byproduct to billion-dollar commodity
Oil and gas companies hoping to cash in on astronomic price increases
Scott Simpson, Vancouver Sun
Published: Friday, April 18, 2008
Commodity markets are so hot these days that even yellow is translating into green. Chemical market researchers are reporting an unprecedented spike in the price of sulphur, the most visible commodity on the Metro Vancouver waterfront and until about a year ago, an uninspired laggard in the ongoing global price boom for metals and minerals.

In March 2007, a tonne of pure sulphur shipped from North Vancouver or Port Moody would have cost you less than $50 US.

This month, it's about $650 for the same volume -- a 13-fold increase in just 13 months -- and one chemical market analyst who spoke this week with The Sun is suggesting that another major spike is on the way.


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There's gold in these storage mounds of sulphur on the North Shore. With growing need as a fertilizer for food, sulphur's price is skyrocketing.
Ward Perrin, Vancouver Sun

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Font:****That means sulphur, one of biggest Canadian exports by volume each year through the Vancouver port, is moving neck and neck with potash as the star performer among Canadian commodities.

Both potash and sulphur are chasing the same market -- they're principally used in the making of fertilizer, which is emerging as a cash cow for manufacturers in a global scramble to produce enough food for a bigger, hungrier world.

Sulphur is produced as a byproduct in the processing of natural gas and oil in Alberta, Saskatchewan and northern B.C. -- and until China began its rapid growth, it was tough for gas and oil companies to find any market for it.

"Several years ago, the price was quite low and the producers were having difficulty paying the railway cost to get it from Alberta or Saskatchewan into the Port of Vancouver," said Patricia Mohr, vice president and commodity market specialist at Scotiabank.

"The [selling] price was barely high enough to pay the rail freight."

Mohr noted that it's not easy for producers to respond to recent demand because most sulphur around the world is derived from oil and gas sources that are experiencing only nominal growth -- if, indeed, they're growing at all.

But producers of sulphur are benefiting in an unprecedented way.

"In the past, I wouldn't say sulphur has been unimportant, and it hasn't yielded a lot of cash flow to oil and gas producers," Mohr said. "But they are now starting to be very interested in it again.

"It's interesting because the bankers, such as Scotiabank, are being asked to extend credit on the basis of sulphur prices -- which is something we've never done before."

Shell Canada, Husky Energy and BP are among the producers with a direct connection to the gas and oil industry. Not all of them want to talk about the situation.

According to Barry Clarke, a sulphur market analyst with PentaSul, it's a "thinly traded" commodity with few buyers and sellers, and contracts tend to include confidentiality clauses on matters around negotiated price.

Shell declined an invitation to discuss the presumed favourable effect on the company's net income in Canada.

Husky was more forthcoming.

"Let's face it, the oil and gas industry is in the commodity-marketing business, so it would be a good news story for anyone who has investments in our industry, where their investment produces sulphur as a byproduct," Husky spokesman Dennis Floate said in a telephone interview from Calgary.

120,000 tonnes per annum X $650.00 = 78,000,000 of pure byproduct