the australian article.

Metal miners take a shine to moly
Robin Bromby
January 29, 2007

COPPER has been bouncing back, gold has a new and higher support level, nickel is going wild, and now molybdenum, often a by-product of copper, is refusing to heed all the bearish warnings.
The Chilean Copper Commission claimed earlier this month that the specialty metal, used to strengthen steel, was about to fall and could be down 19 per cent this year on 2006.
Instead, it rose from $US24/lb to $US26/lb in the next week.

Molybdenum was practically unheard off in Australia until a couple of years ago and now, it's one of the fashionable metals to be in.

Queensland Ores is gearing up to produce it and tungsten from August at its Wolfram Camp mine in northern Queensland.

Moly Mines has one of the bigger projects at its Spinifex Ridge project in Western Australia and, just northeast of Carnarvon, Catalyst Metals has been getting high-grade molybdenum hits at its Minnie Springs deposit.

Others with moly (as it is usually called) in their kitbags include Thor Mining, PacMag Metals, Frontier Resources, Intermin Resources, D'Aguilar Gold and Takoradi.

Most are several years away from production, as is Marengo Mining, which has a large copper-molybdenum project in Papua New Guinea.

It is so large that the Perth company claims it as the biggest undeveloped copper-molybdenum porphyry system in the southwest Pacific.

Managing director Les Emery doesn't expect to be producing from Yandera until 2011, but he's not fussed at the prospect of others getting into the small market before Marengo.

According to him, the world's biggest moly mine, Rio Tinto's Bingham Canyon, is due to be exhausted of the metal by 2013.

And Teck Cominco's big operation at Highland Valley in Canada is also nearing the end of its economic life.

Mr Emery comforts himself that Marengo owns one of the few large undeveloped copper deposits that has molybdenum as a by-product.

"Most of the others are copper-gold," Mr Emery said.

Although the moly was there in much smaller quantities than copper, its presence added 40 per cent to the in-ground value of the deposit, he said.

Yet, for all the confidence among Australian players, they do face some stiff competition from abroad.

And it is a small market: London-based metals analyst Roskill Information Services estimates about 181,000 tonnes was produced and sold worldwide in 2005.

But the prices have pulled in more would-be producers, rising from an average $US4.50/lb between 1994 and 2004, to a high of more than $US40/lb in 2005.

The demand is growing not just from conventional steel makers, but the metal is seen as a lower cost alternative to nickel in stainless steel.

It is also used in pipelines because its properties include resistance to corrosion caused by high sulphur content in oil.

Idaho General Mines will make a big dent in the present supply shortage when its Mt Hope deposit in Nevada comes on stream with 15,880 tonnes a year.

Another Canadian, Adanac Molybdenum is hoping to develop a deposit in Yukon Territory and Blue Pearl Mining, listed in Toronto, claims to be the world's biggest moly producer and has recently increased its production estimates.

There are also the Chinese to be reckoned with.

According to Mining Journal, Luoyang Luanchuan Molybdenum Group plans to float next month on the Hong Kong Stock Exchange.

It owns what it believed to be the world's biggest deposit: 2.06 million tonnes of contained molybdenum.