All About Molybdenum

Thompson Creek Metals (NYSE: TC), the company that signed the option agreement with U.S. Energy Corp to acquire up to 75% of U.S. Energy's Lucky Jack molybdenum asset, offers a good guide to molybdenum for the layman on its website:

About Molybdenum

What is Molybdenum?

* Element 42 (symbol Mo) on the periodic table
* Very high melting point (2,610 degrees C)
* Usually occurs in ore bodies as Molybdenite (MoS2)
* Mined by itself or with other metals such as copper
* Milling converts ore into molybdenum concentrate
* Concentrate roasted at 600 degrees C to remove sulfur
* Final product is technical grade molybdenum oxide
* 'Tech oxide' sold as powder or briquettes
* Sometimes combined with iron to form FeMo (ferromolybdenum)
* Prices quoted are for contained Mo
* Largest producers are USA, China and Chile

History

* Identified as an element in 1778 by Carl Wilhelm Scheele
* Produced in a metal powder by reduction in 1782 by Peter Jacob Hjelm
* First application in 1910 as a filament support for incandescent lamps

Main Uses for Molybdenum

* Strengthens steel
* Powerful anti-corrosive in steel
* Improves weldability
* Reduces brittleness, stress-cracking
* Helps steel perform in very high or low temperatures
* Small amounts added to steel can reduce total tonnage needed
* Key ingredient in high-end stainless steel (ex. 316, duplex)
* 316 stainless generally has 2-3% Mo by weight
* Mo content in duplex steel ranges from 0.6% to 4.8% by weight
* Mo-bearing pipeline steel has up to 0.5% Mo by weight
* Mo catalysts used by refineries to reduce sulfur in gasoline and diesel

Market for Molybdenum

* Worldwide molybdenum consumption about 422 million lbs in 2006
* Dollar value of market currently $14 billion+
* Consumption growth: 4% average annual rate in past 50 years
* Recent pickup in growth: 5.6% average annual rate 2002-2006
* 2006 growth in consumption: 5.8%

Worldwide trends supporting molybdenum use

* Capital spending boom in energy
* Growing need for pipelines, offshore oil and gas, nuclear power
* Regulations requiring less sulfur in gasoline and diesel
* Moly-bearing steel mandated for nuclear plant retrofits
* Automakers seeking reduced weight, enhanced passenger safety
* Ongoing drive to lower costs via reducing total tonnage used