The Demand for Magnesium is Projected to Grow

NEW YORK, March 16, 2018 /PRNewswire/ --

According to data provided by Roskill the global growth in the magnesium market is expected to average 3.4% per year (PY) reaching almost 1.2Mtpy (metric ton per year) by 2020. The report indicates that the development of magnesium metal with a dense uniform dispersion of silicon carbide nanoparticles has the potential have a significant long-term impact on demand. Magnesium castings are used chiefly by the automobile industry, but also in aerospace components, defense applications and consumer goods (laptop, tablet and mobile phone cases in particular). In addition, recently rechargeable magnesium batteries have attracted considerable attention because of their potential high energy density and low cost. MGX Minerals Inc. (OTC: MGXMF), Luxfer Holdings PLC (NYSE: LXFR), Compass Minerals International, Inc. (NYSE: CMP), Intrepid Potash, Inc. (NYSE: IPI), Nemaska Lithium Inc. (OTC: NMKEF)

The battery materials market includes various material under its umbrella. According to Transparency Market Research, the types of battery materials are anode (lithium, graphite, magnesium, etc.), cathode (lithium, manganese dioxide, manganese oxide, lithium cobalt oxide, etc.), electrolyte (zinc carbon, sulfuric acid, etc.), binders, and others. Among them, cathode accounts for maximum share in the market. The report projects the battery materials market to rise, registering a CAGR of 13.6% during the forecast period from 2017 to 2025. Rising at this pace, the market which was valued at US$4.4 billion in 2016, will likely grow to reach US$13.70 billion by 2025.

MGX Minerals Inc. (OTC: MGXMF) also listed on the Canadian Securities Exchange under the Ticker (CSE: XMG). Yesterday the company announced that, "as a result of the recently announced positive Preliminary Economic Assessment ("PEA") for the production of 161,000 net tonnes per year of magnesium oxide (MgO) at its Driftwood Creek Magnesium Project ("Driftwood Creek" or the "Project"), the Company has engaged engineering firm Hatch Ltd. ("Hatch") to complete a scoping study for the purpose of selecting appropriate process and associated economics for the upgrading of magnesium oxide to magnesium metal. The Hatch study will evaluate process routes, and order of magnitude capital and operating cost estimates for an initial 10,000 tonne per year (tpy) magnesium plant as well as address various environmental and engineering topics.

The scoping study may further enhance the already positive economics of Driftwood Creek with the addition of Mg Metal to proposed MgO production, as well as provide diversification into advanced materials. The current price of magnesium metal (99.5% ingot) is approximately $2,250 per tonne versus MgO (DBM 95%) at approximately US$600 per tonne. Contained Mg in MgO is 60.3%, making the process and associated recovery as well as energy use a key focus of the study. Additionally, long-standing anti-dumping and strategic metal designation has significantly increased the domestic price of Mg in the United States compared with global markets. A single sole producer of magnesium metal in the U.S. has operated for many years. Of note is the fact that Canada is no longer subject to these U.S. tariffs against foreign magnesium metal imports. Additionally, Driftwood is located in an area of low cost power in southwest British Columbia and proximate by direct rail to even lower cost power in eastern Washington State.

Magnesium metal is considered an advanced material. Magnesium is 33% lighter than aluminum, 60% lighter than titanium and 75% lighter than steel while offering comparable strength ratios. Automobile and aerospace manufacturers are increasingly shifting towards magnesium-alloys to reduce vehicle and aircraft weights and meet growing fuel-efficiency demands, while recent advances in magnesium battery technology represent strong potential for future additional non-structural applications."

Luxfer Holdings PLC (NYSE: LXFR) is a global materials technology company specializing in the design, manufacture and supply of high-performance materials, components and gas cylinders to customers in a broad range of growing end-markets. Luxfer Group is the world leader in the manufacture of: magnesium alloys, magnesium powders and magnesium products; zirconium chemicals and oxides; superformed components in aluminum and magnesium; high pressure aluminum and carbon composite gas cylinders. Under its Magnesium Elektron brand, the company develop and manufacture specialist lightweight, corrosion-resistant and flame-resistant magnesium alloys, extruded magnesium products, magnesium powders, magnesium plates and rolled sheets and photo-engraving plates. The company's lightweight magnesium alloys and components are used in the aerospace and automotive industries. The magnesium powders are used in the defence industry for countermeasure flares to protect aircraft against missile attack.

Compass Minerals International, Inc. (NYSE: CMP) produces salt, plant nutrients and magnesium chloride for distribution primarily in North America. On February 13, 2018, the company reported a year-over-year increase in fourth-quarter revenue and operating earnings driven by improved Plant Nutrition South America results, which more than offset weather-driven weakness in the company's Salt business. Solid demand drove year-over-year increases in revenue for Plant Nutrition business. Produquímica fully integrated, contributed approximately $375 million in revenue and $49 million in operating earnings.

Intrepid Potash, Inc. (NYSE: IPI) is the only U.S. producer of muriate of potash. Potash is applied as an essential nutrient for healthy crop development, utilized in several industrial applications and used as an ingredient in animal feed. Intrepid also produces a specialty fertilizer, Trio®, which delivers three key nutrients, potassium, magnesium, and sulfate, in a single particle. On February 27, 2018, the company reported its financial results for the fourth quarter and full year 2017. The company said full year potash segment gross margin improved $44.3 million compared to the prior year. Potash segment gross margin of $4.3 million in the fourth quarter contributed to full year potash segment gross margin of $15.7 million.

Nemaska Lithium Inc. (OTCQX: NMKEF) intends to become a lithium hydroxide supplier and lithium carbonate supplier to the emerging lithium battery market. On February 2, 2018, the company announced the closing of the sale of its 100% undivided interest in the Sirmac lithium property to ABE Resources Inc. as previously announced on December 14, 2017. The Property consists of 24 map designated mining claims covering approximately 1,100 hectares, located approximately 180 kilometres North-West of Chibougamau, in the province of Québec. "With the closing of this transaction, we are now the largest single shareholder of ABE which intends to focus on exploring and developing the Property that is located just south of our Whabouchi Lithium Mine," commented Guy Bourassa President and CEO of Nemaska Lithium. "We will be watching their progress with interest and we look forward to seeing the developments."

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