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China controls almost 100% of the world’s supply of electrolytic manganese
metal (EMM)
The three factors are climate change, renewable energy and U.S. Foreign
Policy.
With heated rhetoric coming from both sides, and both countries navies
flexing muscles in the disputed waters of the South and East China Seas,
China and the U.S. seem to be on a collision course.
However both the 1943 Cairo Declaration and 1945 Potsdam Declaration state
that Japan will return to China all Chinese territory taken by Japan. This
time diplomacy rules and a shooting war does not start - the declarations
include the contested islands, what the Chinese call the Nansha (Sprately)
Islands.
Instead the U.S., as President Trump promised on the campaign trail, will
impose tariffs on Chinese imports. China will immediately retaliate and the
situation might descend into an all out trade war. Whatever Trump decides to
do he isn’t the type to embrace ‘status quo.’ And that means a continuing
contentious headline relationship between China and the U.S.
So what is that investable theme I mentioned earlier? Energy storage, or
more specifically, the energy metals that are going to make the much needed
advanced energy storage systems possible. The energy storage sector, as it
applies to strategic and critical minerals, electric vehicles and handheld
rechargeable devices, is starting to look especially attractive/lucrative.
The United States Geological Survey (USGS) says the U.S. is now 100%
dependent on other countries for 19 minerals.
Manganese is one of them and is a basic building block any nation needs
for its economic foundation.
Aside from iron manganese is the most essential mineral in the production
of steel. You can’t produce steel without adding 10 to 20 lbs. of
Electrolytic Manganese Metal (EMM) per ton of iron. The US government has
classified manganese as a strategic metal
for over a hundred years. This is not hard to understand when manganese has
no substitute in its many steel applications and has itself become a
substitute for other more expensive metals in certain alloys.
China currently levies a 20% export tax on EMM. There are no mines
producing manganese ore in the U.S. or Canada. There are no domestic
suppliers of EMM in North America - China controls 97% of the world trade in
EMM.
The same circuits that make EMM make electrolytic manganese dioxide (EMD).
EMD is a key ingredient in the production of lithium-ion, lithiated-ion,
alkaline and zinc/manganese batteries. The U.S. is the largest consumer of
EMD worldwide.
Many scientists say it's very likely that most of the warming since the
mid-1900s is because our burning of fossil fuels for energy production and
transportation adds heat-trapping greenhouse gases into the air.
Tesla CEO Elon Musk says energy storage is the last vital piece, the
missing link needed to wean the global economy off fossil fuels
and enable widespread adoption of renewable clean energy and electric cars.
But it seems to get there we need a long term 'domestic' supply chain of
manganese – from mine to battery. It’s becoming apparent that North America’s
supply of EMM, and more advanced products such as EMD, should no longer be
based on the goodwill of China.
Manganese X Energy Corp. (TSXV: MN) (OTC: SNCGF) (FSE:
9SC2) is a Canadian company seeking to create a secure North American source
of manganese ore. Manganese X has committed to investigating all options of
enhancing manganese for the purposes of lithium-ion, lithiated-ion, alkaline
and zinc/manganese battery use.
2017-02-13 MANGANESE X FIRST PHASE DRILL PROGRAM INTERSECTS WIDE
WIDTHS OF MANGANESE OXIDE NEAR SURFACE
“Manganese X Energy Corp. has released assay
results from the recently completed diamond drill program
at its Houlton Woodstock manganese property, located in Carleton county, five
kilometres northwest of Woodstock, N.B. The drilling program consisted of 16
holes totaling 3,589 meters, and was designed as an initial evaluation of
three historic manganese occurrences on the property (Iron Ore Hill, Sharpe
Farm and Moody Hill). In addition, the drill program provides core samples
for metallurgical testing, planned for 2017.
Five holes totaling 1,051 m were completed in the Iron Ore Hill sector
of the property and eleven holes totalling 2,538 m in the Sharpe Farm - Moody
Hill sector. Drilling was completed over a 1.8 km strike length of the prospective
manganese occurrence trend. During the drill program, emphasis was placed on
the Sharpe Farm - Moody Hill sector, henceforth called the Battery Hill
Deposit by the Company.
Conclusion from the Battery Hill Deposit Drill Program
The initial drill program, consisting of wide spaced drill holes, has
confirmed significant widths of near surface manganese mineralization over a
strike length of approximately 1.5 km.
Intersection widths of up to 87.7 m (287.7 ft) and MnO grades of up to
21.5% were encountered…
Mineralization remains open to depth and along strike.
Based on the current drill results, the mineralization shows good
continuity and has been intersected from surface to vertical depths of 115
meters. The Company is exploring the property with the objective of potential
future development through low cost open pit mining.”
With relations between the U.S. and China remaining in the headlines for
some time I would expect to hear much more regarding this energy critical
metal the U.S. sources almost 100% from China.
Richard owns shares of Manganese X Energy Corp.(TSX.V: MN)
This document is not, and should not be construed as an offer to sell or
the solicitation of an offer to purchase any investment.
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