First Time Visitor? Welcome

Don't forget to Participate in our weekly So you think you can Save $15 Starbucks giveaway.

Sound Fun? Have our articles delivered to you via RSS Feed or E-mail to be reminded of new and upcoming contests.

In 2007, it would seam that every one is trying to get in on the energy bandwagon, and for good reason. Petroleum prices are surging on a regular basis and commodity metals, such as gold, are through the roof. So, as the saying goes “hit the ball where they ain’t” can be said to apply as investors line up in various energy sectors to capitalize on the run toward energy.

Molybdenum a Hidden Source of Strength

When investors think of energy petroleum is generally the first thing that comes to mind. What is missed in this assessment of, what is energy?” comes in the form of a little known ore called Molybdenum (or Moly for short) that is used to strengthen steel, of various types, and provide a corrosion resistance not found in refined and smelted steel products. The ore is not one of the more “sexy” investment vehicles found in most portfolios but non-the-less can be considered a potential steady player for the longer term if “junior” players are considered for the investment.

What makes Molybdenum so interesting is the energy markets that it contributes to. According to the International Molybdenum Association 80 percent of all Molybdenum mined goes into the production of tools, high speed steel, and stainless steel. Stainless steel and high strength steel are the two primary consumers of the material and make up the general future of it. As the energy sector continues its exploration for crude oil and gas deposits it goes deeper and more far a field in its search. These deposits are often very deep underground and contain very high levels of corrosive sulfur and other nasty elements.

Many Possibilities

When put into the materials mix Molybdenum helps to prevent the corrosive ware in the drilling equipment and in the corresponding transport of the product from the drill site to the refinery or customer. In the instance of natural gas there is and are plans for approximately 73 million miles of piping around the world, which will require Molybdenum’s use for stainless steel tubing and pipes.
Stainless steel piping for gas transport is but one of the energy sectors that Molybdenum will be in demand for. Coal liquidification plants, particularly in China, nuclear power plants using uranium, drilling rigs and even coastal architecture are finding that having a material available to protect their project is invaluable.

One particular sticking point to the ores use is its availability. There are reported to be vast reserves of the material around the world but still in the ground. In the mining world cost is everything so the price of the extracted material is critical for ramping up mining operations. Currently, there are several Junior operators waiting for permits and ready to go with a Molybdenum price of approximately $28 per pound There are, however, no larger players owing to environmental concerns and higher operational costs. Current supply and price are relatively stable and will likely float around these levels for the time being. Most within the market, however, indicate that a time frame of 5-8 years should find those that establish themselves now in a solid position while taking a smaller risk-return approach

Popularity: 12% [?]

Related Content