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Posts tagged ‘American Manganese Inc. (AMY)’

The stuff of life

March 23rd, 2015

Little-known but essential commodities can offer near-term potential, says MGX Minerals

 

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Without them, modern life wouldn’t be very modern. A wide range of industrial minerals make possible so much of what we take for granted, from luxuries to conveniences to necessities. Although few of the commodities are familiar to investors, CEO Jared Lazerson of MGX Minerals CSE:XMG believes he’s found opportunities for potentially near-term domestic production to supply North American markets.

Since its trading debut last October, MGX has been busy acquiring properties in British Columbia, mostly with a goal of producing magnesite. In fact the company has tracked down and claimed most of B.C.’s significant magnesite occurrences. The province currently hosts one of the only two magnesite mines in North America.

Little-known but essential commodities can offer near-term potential, says MGX Minerals

Driftwood Creek drilling confirmed near-surface magnesite mineralization.

As a source of magnesium, magnesite—not to be confused with magnetite—meets a number of agricultural, pharmaceutical, environmental and industrial applications. Exceptionally light for a structural metal, magnesium is used to manufacture cars and planes, among other uses. As part of an alloy, it helps make more rigid metals suitable for shaping into manufactured products.

Magnesium can be mined from magnesite or dolomite and can also be extracted from seawater or natural brines, which accounted for about 69% of American domestic magnesium compounds production in 2014, according to the U.S. Geological Survey.

USGS data shows about 52% of magnesium compounds consumed in that country last year went to agricultural, chemical, construction, environmental and industrial applications. The remaining 48% was used for refractories.

As for magnesium metal, USGS numbers show 35% of American consumption in 2014 went to aluminum-based alloys used largely in packaging and transportation. Another 30% was used as a reducing agent in the production of titanium and other metals, 15% for structural purposes, 10% for desulfurization of iron and steel, and 10% for other applications.

By far the largest global supplier, China accounted for about 89% of the world’s magnesium metal production last year, according to the USGS. Israel and Russia managed to make up about 3.3% and 3.1% respectively.

As for magnesium compounds, China again dominated world production with about 70% last year. Russia came up with about 5.7% and Turkey 4.3%.

A new North American producer, especially one that’s close to existing transportation infrastructure, could offer the continent’s market considerable advantages, says Zimtu Capital TSXV:ZC president Dave Hodge.

“MGX is a fairly unique story,” he points out. “It’s had a very recent IPO but it’s already in the permitting process. Magnesium comes in a variety of forms and one of the things they’re working on now is determining what form they would produce at what cost, versus the size of the market for that specific commodity. Those markets take different grades and different grades are produced at different costs. The opportunity here is to determine what’s the best product to produce and create value for their shareholders.”

Hodge adds, “In many respects this is not so much a mining story but more of a business story.”

Last July Lazerson signed a three-year cash, share and expenditure deal that would give the company a 100% interest in the 326-hectare Driftwood Creek project. Now MGX’s flagship, it’s located in southwestern B.C.’s Kootenays, a region that also hosts Baymag Inc’s Mount Brussilof magnesite mine. With logging roads on the property itself, Driftwood sits about 15 kilometres from highway, power and a CP spur line.

Lazerson sees near-term potential for a relatively simple quarry operation with a low strip ratio.

MGX also gained considerable expertise in CFO Michael Reimann and VP of exploration Andris Kikauka. Reimann, with a PhD in physics, has served over 45 years in senior corporate management positions, most recently with Skana Capital and PNG Gold TSXV:PGK. Kikauka’s 30-year background includes service as project geologist for the exploration and geotechnical consulting firm Rio Minerals. He’s currently a director of American Manganese TSXV:AMY.

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American Manganese advances AZ Artillery Peak Project Metallurgy

February 17th, 2012

Resource Clips - essential news on junior gold mining and junior silver miningAmerican Manganese Inc TSXV:AMY announced an independent report by cleantech analysis firm Kachan & Co validating the hydrometallurgical process to be used at its Artillery Peak project in Arizona. The process uses commercially available equipment and maintains a low-cost, low-energy output while retaining a recovery rate of 92-93%% electrolytic-manganese metal at a purity of over 99.7%. Kachan’s Managing Partner Dallas Kachan said, “On paper and in pilot, American Manganese’s hydrometallurgical process is promising. The near closed-loop nature of the process appears to result in high-grade electrolytic manganese metal with little environmental impact and at a low cost. Proving the process at scale in the field will be the company’s biggest challenge, but early indications are encouraging.”

American Manganese President/CEO Larry Reaugh commented, “Kachan was commissioned to do an independent assessment of our hydrometallurgical process. Its findings illustrate how American Manganese has developed one of the most efficient models of mining low-grade manganese ore and producing low-cost, high-grade electrolytic manganese metal. To have a net positive report published by a leading cleantech analysis firm supporting our unique hydrometallurgical process is a huge success for American Manganese. We are encouraged to continue to work towards becoming the lowest cost producer of electrolytic manganese metal in the world.”

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Contact:
American Manganese Inc
604.531.9639

or Kachan & Co
Ryan Tessier
Press Contact
604.613.6143

by Ted Niles

American Manganese President Larry Reaugh on updated Artillery Peak resource

September 12th, 2011

Resource Clips - essential news on junior gold mining and junior silver miningAmerican Manganese Inc TSXV:AMY announced an updated 43-101 resource for its Artillery Peak Manganese Project in Mohave County, Arizona. The report estimates 226.46 million tonnes grading 2.99% for 14.92 billion pounds manganese indicated and 56.42 million tonnes grading 2.84% for 3.54 billion pounds manganese inferred.

President/CEO Larry Reaugh tells ResourceClips.com, “We’re certainly happy. Most of the drilling was infill drilling, and it’s moved up the indicated resource, a much more confident resource, by 123%. We did a little drilling outside the boundaries, and overall the entire resource went up just under 20%. We now have almost 15 billion pounds of manganese indicated, where we had less than half of that amount of indicated previously. And of course we’ve only touched 20% to 25% of the property, so we expect further drilling will bring more increases.

We now have almost 15 billion pounds of manganese indicated, where we had less than half of that amount of indicated previously. And of course we’ve only touched 20% to 25% of the property—Larry Reaugh

“We’re not drilling at the moment,” he points out. “We may go back this fall. It all depends on the market, but we are completing our pilot plant testing. That got underway around August 18, and I expect that’ll be complete sometime this weekend. Everything we’re seeing there is looking really good. So we’re not expecting any surprises.

“Wardrop [Engineering] is working on prefeasibility. They’ll take the results from the pilot plant; they’ll model a pit from the latest resource study; and they’ll deliver a report hopefully at the end of October or early November.

“We hope to be in production by mid-2014. So far there’s nothing to say that we can’t, but it all depends on permitting and a few other things. Market conditions are always a factor, and permitting is a major factor. But Arizona is the largest mining state in the US, and our project, compared to some of the big copper, copper-moly projects that have gone ahead recently in Arizona, is miniscule in size.”

Reaugh adds, “China controls about 98% of manganese production. They are shutting down some production for environmental and efficiency reasons, plus they’re starting to police the border between China and Vietnam to hopefully stop the smuggling to the European market. All that will decrease the amount of supply, and I expect demand will increase as rapidly as it has in the past, so I can foresee shortages that would lead to higher prices.

“It’s not a luxury item; it’s a necessity. You can’t make steel without manganese. If you want to get into specialty stainless steels, you need the metal. Certainly the aluminium industry is about a third of the entire demand, so it’s a necessity. There’s no substitute for it.

“Our big advantage, according to our PEA, is that we could be the lowest-cost producer in the world,” he explains. “Right now we’re certainly looking at well under half what it costs to produce in China, and it’s all to do with the process. That’s what the pilot plant is all about. That’s looking excellent, so I’m very happy.

“Continuous operation at the pilot plant has been excellent. It’s performed 100%. But we won’t have the report about metallurgical recoveries, what’s in the tailings, what we might be losing in the system or water efficiencies for at least another month.

“I think the pilot plant is probably the turning point in the company’s progression,” Reaugh emphasizes. “We’ve had a process that we worked in batches, and it has performed. But on a continuous basis, that’s a different story. Now we’ve been running material for several days on a continuous basis, and the results, like liquid-solid separation and all those things, are performing as we want them to. I think we’re going to remove the big hurdle which a lot of companies, some of our competitors and other mining companies, would look at as a potential risk. We’re going to eliminate that within a month.”

View Company Profile

Contact:
American Manganese Inc
604.531.9639

Disclaimer: American Manganese Inc is a Resource Clips advertiser.

by Greg Klein

American Manganese reports AZ 43-101: 14.92 Billion lbs ind, 3.54 Billion lbs inf

September 9th, 2011

Resource Clips - essential news on junior gold mining and junior silver miningAmerican Manganese Inc TSXV:AMY announced an updated 43-101 resource for its Artillery Peak Manganese Project in Mohave County, Arizona. The report estimates 226.46 million tonnes grading 2.99% for 14.92 billion pounds manganese indicated and 56.42 million tonnes grading 2.84% for 3.54 billion pounds manganese inferred.

President/CEO Larry Reaugh tells ResourceClips.com, “We’re certainly happy. Most of the drilling was infill drilling, and it’s moved up the indicated resource, a much more confident resource, by 123%. We did a little drilling outside the boundaries, and overall the entire resource went up just under 20%. We now have almost 15 billion pounds of manganese indicated, where we had less than half of that amount of indicated previously. And of course we’ve only touched 20% to 25% of the property, so we expect further drilling will bring more increases.

We now have almost 15 billion pounds of manganese indicated, where we had less than half of that amount of indicated previously. And of course we’ve only touched 20% to 25% of the property—Larry Reaugh

“We’re not drilling at the moment,” he points out. “We may go back this fall. It all depends on the market, but we are completing our pilot plant testing. That got underway around August 18, and I expect that’ll be complete sometime this weekend. Everything we’re seeing there is looking really good. So we’re not expecting any surprises.

“Wardrop [Engineering] is working on prefeasibility. They’ll take the results from the pilot plant; they’ll model a pit from the latest resource study; and they’ll deliver a report hopefully at the end of October or early November.

“We hope to be in production by mid-2014. So far there’s nothing to say that we can’t, but it all depends on permitting and a few other things. Market conditions are always a factor, and permitting is a major factor. But Arizona is the largest mining state in the US, and our project, compared to some of the big copper, copper-moly projects that have gone ahead recently in Arizona, is miniscule in size.”

Reaugh adds, “China controls about 98% of manganese production. They are shutting down some production for environmental and efficiency reasons, plus they’re starting to police the border between China and Vietnam to hopefully stop the smuggling to the European market. All that will decrease the amount of supply, and I expect demand will increase as rapidly as it has in the past, so I can foresee shortages that would lead to higher prices.

“It’s not a luxury item; it’s a necessity. You can’t make steel without manganese. If you want to get into specialty stainless steels, you need the metal. Certainly the aluminium industry is about a third of the entire demand, so it’s a necessity. There’s no substitute for it.

“Our big advantage, according to our PEA, is that we could be the lowest-cost producer in the world,” he explains. “Right now we’re certainly looking at well under half what it costs to produce in China, and it’s all to do with the process. That’s what the pilot plant is all about. That’s looking excellent, so I’m very happy.

“Continuous operation at the pilot plant has been excellent. It’s performed 100%. But we won’t have the report about metallurgical recoveries, what’s in the tailings, what we might be losing in the system or water efficiencies for at least another month.

“I think the pilot plant is probably the turning point in the company’s progression,” Reaugh emphasizes. “We’ve had a process that we worked in batches, and it has performed. But on a continuous basis, that’s a different story. Now we’ve been running material for several days on a continuous basis, and the results, like liquid-solid separation and all those things, are performing as we want them to. I think we’re going to remove the big hurdle which a lot of companies, some of our competitors and other mining companies, would look at as a potential risk. We’re going to eliminate that within a month.”

View Company Profile

Contact:
American Manganese Inc
604.531.9639

Disclaimer: American Manganese Inc is a Resource Clips advertiser.

by Greg Klein

Mining Rock On The Rock

September 9th, 2011

Buchans has Zinc in Nfld and Manganese in NB

By Ted Niles

It’s a familiar story—junior miner purchases historic producer and discovers significant and mineable remainder. That Newfoundland’s Buchans Mines were active from 1928 to 1984, producing in excess of 16 million tonnes of ore, gives one a better sense of what might possibly remain. Buchans Minerals President and CEO Warren MacLeod says of the Lundberg base-metals deposit, “It is literally underneath the old Lucky Strike glory hole and the old mine buildings. They built the mine site right on top of what they considered, at that time, lower-grade material, but which in today’s world is economic ore. When we went in there our philosophy was: let’s see what the old timers left behind. It didn’t take us long to find it.”

Located outside the town of Buchans, 330 kilometres northwest of St John’s, the Buchans property comprises 12,800 hectares, of which the Lundberg deposit covers 215 claims over 5,375 hectares. In November 2008 Buchans released an NI 43-101 resource estimate for Lundberg of 20.7 million tonnes inferred, with a combined zinc, lead and copper grade of 2.78%.

Buchans has Zinc in Nfld and Manganese in NB

Misgivings that this was still not economic grade propelled Buchans to undertake a preliminary economic assessment. “We believed that Lundberg could be a standalone mine, and we knew the existing management at the time didn’t really know what they were sitting on,” MacLeod says. The PEA confirmed MacLeod’s hopes. Based on a 5,000 tonne-per-day open-pit and milling operation with a ten-year mine life, it projected Lundberg would have a pre-tax internal rate of return of 43.9% and a net present value (at a discount rate of 6%) of $217.8 million. Average operating costs are estimated at $23.79 per tonne with net revenues of $52.95 per tonne. Payback on capital expenditures is expected to be 1.5 years. Exclaims MacLeod, “Obviously, it’s screaming out that this could potentially become a mine!”

In addition to good infrastructure and the obvious permitting advantages of building a mine on a brownfields site, Buchans also owns deposits nearby that could potentially supplement Lundberg. Among these are Clementine West, Buchans North and Daniel’s Pond. Located about 30 kilometres west of Teck Resources’ Duck Pond mine, Daniel’s Pond has a current NI 43-101 indicated resource of 1.16 million tonnes grading 4.44% zinc, 2.12% lead, 0.31% copper, 87.79 g/t silver and 0.60 g/t gold and an inferred resource of 450,000 tonnes grading 3.88% zinc, 1.74% lead, 0.27% copper, 81.63 g/t silver and 0.52 g/t gold.

Buchans anticipates another drilling program to update Lundberg from inferred to indicated, then it will move to prefeasibility. From there to production, MacLeod says, would be five years. But before any of these steps can be taken, the company needs to find a joint-venture partner or “split the project off into its own private company, get it financed, then ultimately take it public in its own right.” MacLeod says that discussions with interested parties are ongoing and that he has a “personal goal to get some kind of deal wrapped up before Christmas.”

MacLeod notes, “Brook Hunt [& Associates] indicate that zinc will go into production shortfall from existing mines—as well as probable and possible mines—around 2015. And the Royal Bank of Canada is projecting 2014-2015 prices of around $1.30 a pound. If we have that kind of price, it would improve the economics. And if we aggressively pursue this project, it could come into production right around the time the anticipated shortfall is occurring. The timing could almost be perfect for Lundberg.”

If we aggressively pursue this project, it could come into production right around the time the anticipated zinc shortfall is occurring. The timing could almost be perfect for Lundberg —Warren MacLeod

Meanwhile, Buchans has been working its “dark horse asset,” its 5,800-hectare Woodstock manganese property in New Brunswick. An historic (non-NI 43-101 compliant) resource estimated the Plymouth deposit had 46.5 million tonnes grading 10.9% manganese and 13.3% iron, and the North and South Hartford deposits had 90 million tonnes at 8% manganese and 12% iron. MacLeod reports, “When we were researching Woodstock, we came across a joint federal- and provincial-government report about a program from the 1980s to find out whether you could leach this material. The importance of this is that if you’re applying leach technology, you’re going to be producing manganese cheaper than the Chinese, and you’re going to be producing it using a technology that’s not as tough on the environment as roasting.”

He continues, “We’re pretty confident that we will be able to leach the material from the ore. If we’re able to achieve that, it will really open the door for this project to accelerate to a purely economic assessment stage. One of the important things to note is that American Manganese’s Artillery Peak deposit is not the only game in town in North America for electrolytic manganese metal. Woodstock is pretty close on its heels. I think that the scale of this project could be significantly larger than Lundberg.”

Buchans announced September 7 results from three of the first five holes drilled at Plymouth. These include 11.43% manganese and 16.14% iron over 45 metres, 11.43% manganese and 14.9% iron over 89 metres and 9.22% manganese and 12.75% iron over 63 metres.

Buchans Minerals Corporation has 150.9 million shares trading at $0.075 for an $11.3 million market cap. It also has an early-stage gold project, the Goldquest prospect in southwest Newfoundland, which it holds in 50/50 joint venture with Benton Resources. Drilling is anticipated to begin there in September.

American Manganese President Larry Reaugh on Arizona 2.68% manganese over 32m

July 6th, 2011

“The project is considered by the Arizona Geological Survey to be the largest deposit of manganese in the United States. The US Bureau of Mines spent a lot of time and effort on research, developing that resource to make it a profitable mine. Utilizing their development work and bringing in some new technology in the field today, with Kemetco we have come up with a preliminary economic evaluation that shows that we have a cost of about $0.45 a pound. The current cost in China is $1.30 a pound.

“The drill program that we’re doing is to increase the indicated resource from 6.9 billion pounds, and to add to the inferred resource which [currently is] 8.7 billion pounds. What we’ve been seeing out there is thicker intersections with higher grade intercepts in the middle of them in some of the holes. Certainly a lot of it’s a pleasant surprise to us that this thing extends much further than we thought. So we expect that when we do our 43-101 resource study—say, by the end of August—we will have increased the indicated and hopefully we’ll increase the inferred.

We have news out of China that in the next three to five years they’ll probably lose a third to a half of their production because of depleted resources. So the demand is going to be greater than the supply.—Larry Reaugh

“Historically, this was considered to be a large resource that’s larger now, under the work that we’ve done. We’re moving it ahead with our environmental studies out of Tucson, with Tetra Tech, and Wardrop are doing the prefeasibility work, and the pilot plant testing is being done by Kemetco. The program is completed, and it’ll probably be another four to five weeks before we have all the results. So we’ll have a continuous stream of information coming out on the company. It looks like we’ll hit the fall with our pilot plant testing completed, the resource study completed, and the environmental study will be incorporated into the prefeasibility, which should be completed by October.

“We’re very pleased with these results. The grades are low, but the process—using sulfurous acid—[includes] hours of time in the vat leach tanks, and it comes out at high rates of recovery in the 90% to 95% range. That’s the key. The treatment was developed by the US Bureau of Mines; they operated a mine in the 1940s using it, so this is not new technology. The stuff that we have developed on the other end to make the electrolytic manganese metal improves the efficiencies in water and in power. So it’s energy effecient and water efficient. And, interestingly, while we make EMM on the cathode, on the other side of the equation we could make EMD [electrolytic manganese dioxide] on the anode, and that is used in the battery industry. So we currently have Kemetco looking at making a lithiated manganese powder from our EMD, which would be a very value-added product for us. So it’s exciting times.

“Working with everything we have going now, and if environmental permitting goes through the way we expect, we expect to be in production in 2014.

“Arizona is a mining-friendly state—it’s the largest mining state in the US. There’s a high unemployment rate where we are in Mohave County and we’ve been well received by the constituents there. We foresee this as being a value-added situation for Mohave County.

“I hate to sound like a promoter, but it’s the best project I’ve ever worked on. I’ve never had a project that showed such robust returns—it’ll pay back at a $1.10 electrolytic manganese metal price in just over a year. The price is currently $1.80 in the US because of a 14% import duty. We have news out of China that in the next three to five years they’ll probably lose a third to a half of their production because of depleted resources. So the demand is going to be greater than the supply. We’ve got the best of all worlds here.

“China controls 99% of the electrolytic metal production and if they lose one-third to one-half of their production today—which is around three billion pounds—then that’s going to put pressure on us to look at increasing the size, because basically we have enough there right now for about 150 years. So increasing the size of the project would not deplete the resource that quickly.”

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American Manganese President Larry Reaugh on SoCal Claims purchase

May 19th, 2011

“SoCal is a good move for the future—after Artillery Peak goes into production. These were past producers. It’s a vein system, not a sedimentary system like we have, and they come up from a couple of feet to 20 feet wide and then have to be beneficiated to make ore. So it’s a different aspect of the business, but it’s still manganese business.There’s not going to be a lot happening on the SoCal claim for the moment. We are looking at it as inventory. Or we may joint venture it, if somebody was so inclined.

“Everything is moving ahead on schedule at Artillery Peak. The pilot plant testing is progressing, the prefeasibility is progressing, the drilling is about half done. There will be a press release coming out tomorrow, I think, announcing that we’ll be increasing the drill program. We don’t have assays yet as it’s been less than month since we started the drilling. It’ll be some time towards the end of the month before the first assays will start coming out. But we’ve shipped twelve shipments of sample. And once they start coming we hope it’s going to be fairly consistent after that.

“We’ll also be doing our testing for the battery material probably in July from the pilot plant test. We know if we can do the EMD [i.e. electrolytic manganese dioxide] that we can do the battery material, that’s for sure. We’d like to see if that’s going to be another opportunity to increase cash flow with an insignificant amount more production.”

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Disclaimer: American Manganese Inc is a Resource Clips advertiser.