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Sector: Mining, Energy, Industrial,
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News Release - November
17, 2017 15:08 PM ET
MGX Minerals engineering partner
awarded C$8.2M to manufacture and deploy first full commercial 7,500
BPD system using MGX's technology, MGX initiates geophysics at Utah
Petrolithium Project
NEW YORK, NY, November 17, 2017 /Sector Newswire/ --
MGX Minerals Inc. (CSE:
XMG) (OTCQB: MGXMF)
this week announced the completion of drilling at its Case Lake
Lithium Project. This news falls on the heels of two news releases
the week prior; 1) that MGX Minerals has initiated a Geophysical
Survey at its Utah Petrolithium Project, and 2) that engineering partner PurLucid Treatment
Solutions (“PurLucid”) has been awarded a non-repayable contribution
totaling up to C$8.2 million in government funding for the construction of
a full commercial
system using MGX's technology.
To the left below is excerpt copy of a
recent Mining Journal article (note: near-term $5/share price target
based on MGX's proprietary extraction technology being advanced). To the right is excerpt copy of
recent news releases.
Breakthrough Technology for
Lithium Industry Poised to Propel MGX Minerals Valuation
MGX Minerals Inc. (CSE:
XMG) (OTCQB: MGXMF)
is the subject of a Mining MarketWatch Journal review. MGX Minerals
Inc. is a Canadian-based mining and clean technology processing
company focused on commercializing new brine processing technology
that gives the Company a significant advantage in the marketplace
having solved the problem of magnesium (Mg) in lithium (Li) laden
brine, able to deal with very complex/dirty brines. Up until now rich complex Li brine projects with high Mg:Li
ratios have been passed over as technology did not exist to
economically separate the two. MGX's proprietary/patented technology
now positions scores of complex lithium brine projects (previously
untouchable) across the globe ripe for production, with better
economics than solar evaporation.
Full copy of the Mining Journal Review
may be viewed at
http://miningmarketwatch.net/xmg.htm online.
It has only been since mid-summer-2017 that MGX
Minerals Inc. has been able to accept any water for testing at its
new pilot plant and demand is off-the-chain from both the
petrolithium industry and interested (potentially very large)
lithium pure-play stake holders. The Company's first small-scale
(750 BPD) commercial rapid lithium extraction system is nearing
completion, expected later this November-2017, and the construction
of the
first full commercial 7,500 Barrels-Per-Day (BPD) system using MGX's
technology was announced this November 6, 2017, being made
possible by $8.2M in government grants (representing a strong vote
of confidence in the technology from the highest levels, and a free ride for
shareholders).
The share price of
MGX Minerals Inc. is poised for significant upward revaluation as
the reality of the magnitude of wealth headed shareholders way is
appreciated by the market. MGX Minerals Inc. is now active in
advancing 3 distinct business lines stemming from what experts agree
and results affirm (see Oct. 16, 2017 news "MGX
Minerals Processes High Magnesium Content Lithium Brine of
76,000mg/L") is the worlds most advanced brine processing
technology:
|
Excerpts of
recent news releases from MGX:
Nov. 16, 2017:
MGX Minerals
Announces Case Lake Lithium Project Drilling Nears
Completion
...click
here for full copy of release from source
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Nov. 8, 2017:
MGX
Minerals Initiates Geophysical Survey at Utah Petrolithium
Project, Blueberry Unit, Paradox Basin
...click
here for full copy of release from source
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Nov. 6, 2017:
MGX Minerals Engineering Partner PurLucid
Awarded C$8.2M to Manufacture and Deploy
Wastewater Treatment Systems Central to MGXs
Petrolithium Recovery Process
VANCOUVER, British Columbia, Nov. 06, 2017
(GLOBE NEWSWIRE) --
MGX
Minerals Inc.(“MGX” or the
“Company”) (CSE:XMG) (FKT:1MG) (OTCQB:MGXMF) is
pleased to report that engineering partner
PurLucid Treatment Solutions (“PurLucid”)
has been awarded a non-repayable
contribution totaling up to C$8.2 million in
government funding to support the
commercialization of a low energy water
treatment system for the oil and gas
industry. Specifically, Sustainable
Development Technology Canada (“SDTC”) and
Emissions Reduction Alberta (“ERA”) have
agreed to fund up to $3.2 million and $5
million, respectively. MGX currently owns a
34% interest in Purlucid and has the right
to acquire 100% through successive future
investments. Working with MGX, Purlucid
invented and filed patent applications for
apparatus and methods for brine treatment
and selective lithium recovery that
integrates with the MGX Petrolithium
Recovery Process, greatly reducing the cost
of recovery and enhancing the quality across
the complex range of brines received from
oil and gas wells.
Utilizing its exclusively licensed
pretreatment technology, Purlucid will
fabricate and deploy a commercial-scale unit
within an operating steam-assisted gravity
drainage (SAGD) facility in Alberta. The
project includes participants from oil
production companies, a University and a
global information technology company. The
treatment system, proven in other
applications, will be capable of operating
at high temperatures and pressures to reduce
energy loss while removing oil and mineral
contaminants from oilfield wastewater.
Several process units in existing boiler
feed water treatment plants can be replaced
with this single unit, not just in oil
production but across thermal industries.
Utilizing MGX resources, Purlucid will
implement the lithium recovery process as a
separate but associated project as early as
January 2018.
“Treatment of
wastewater has always been a challenge and
significant cost to oil and gas producers;
it is also essential to implement
petrolithium recovery.” said Dr. Preston
McEachern, CEO and Founder of PurLucid.
“We’re grateful to receive support from SDTC
and ERA in the form of development
contributions, to build the first commercial
system at an operating oil production
facility in Alberta and to demonstrate the
large cost and energy savings that can be
achieved with these systems. It is exciting,
as this opens the door to further processing
of the treated water for petrolithium
recovery.”
The system will utilize a highly charged
Replaceable Skin Layer (RSL™) membrane and
High Intensity Froth Flotation (HiFF)
system, known as Nanoflotation, which
collectively have demonstrated performance
superiority over other processes typically
used to remove contaminants. The technology
allows high temperature water treatment at
10-30 times the efficiency of existing
ultrafiltration systems and offers numerous
environmental benefits, including
contaminant removal, mineral recovery,
reduced energy demand, smaller footprints
and lower capital costs. The system is
integral to the highly efficient processing
of petrolithium brines for lithium recovery.
The technology was a 2017 finalist for the
Most Disruptive Technology in the World
award by Katerva.
Extending from success achieved with the
Purlucid pilot petrolithium recovery system
deployed in August 2017, fabrication of the
first small commercial Purlucid lithium
recovery system will be completed in
December 2017 and ready for use in 2018 on
the treated brines from the grant supported
project and other MGX brines successfully
trialed with the bench-scale and pilot
systems.
.
...click
here for full copy of release from source |
|
3 distinct business lines:
Figure 1.
Oil & Gas wellheads..
|
1)
Petrolithium processing; involves capturing oil, natural
gas, and minerals from oil & gas industry brine, leaving cleaner
water behind. MGX Minerals is deploying the only technology that can
deal with ultra-high total dissolved solids plaguing the oil & gas
industry. The Company currently has ~20 testing and analysis
agreements in place with almost every major oil company in Western
Canada and a good number in the US, now talking with the biggest oil
and gas companies, from Chesapeake to Shell. MGX Minerals is in the midst of
turning out win-win proposals that solve major problems for industry
and see MGX as the beneficiary of both significant dollar revenue
and Lithium streams (MGX aims to negotiate contracts in the
petrolithium sector that result in MGX Minerals keeping control of
the lithium product). The company has essentially created its
own sub-sector in the industry by focusing on petrolithium, turning
garbage into gold. Look for contracts of significance to
materialize near-term that cumulatively will light a fire under the
share price of MGX Minerals over the coming years.
|
Figure 2.
Lithium laden brine.
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2)
Major Lithium pure-play; MGX Minerals is targeting Li
from economic/high-grade brine projects, both complex (e.g. high
magnesium) or clean. On a head-to-head basis with solar evaporation
lithium analysts in-the-know now agree MGX's technology has superior
characteristics of lower capex, better Li recoveries (70+% vs. 40%), lower opex,
has a substantially smaller footprint than miles of evaporation
ponds, is faster (8 hours end-to-end vs. 18 months), and turns the
presence of magnesium on its head -- treating Mg as a valuable
commodity that can be extracted for sale, instead of causing a
project to be passed over. Many high magnesium lithium projects
around the globe (from the Americas to China) are now being
revisited because of MGX Minerals technology. It is a distinct
reality now of MGX Minerals being at the center of projects with
potential to generate 10s and even 100s of thousands of tonnes per
annum of lithium carbonate and lithium hydroxide (the main saleable
form of Li used by EV/Li-ion battery manufacturers). Lithium
analysts this Mining Journal have talked with have confirmed
interest is high regarding MGX Minerals' technology from major
Li-industry stake holders. The Company is in the process of setting
up a South America sales office in Chile. |
Figure 3.
Left to right/before to after of
MGX's wastewater processing technology; 1) Raw (feed),
2) intermediate chemical ppt, 3) final water prior to
desalinization.
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3)
Wastewater handling;
MGX is also a clean-tech Company with the ability to treat and reclaim
wastewater for the oil & gas industry, unparallel to anything
currently in the market. The industry is ripe for technology shift
in cost-savings from water handling. MGX can eliminate environmental
issues, reduce disposal costs, and reduce the need for acquiring
new water. MGX is a major owner (with the rights to acquire 100%) of
PurLucid Treatment Solutions which is essentially the engineering,
manufacturing, and development arm behind the breakthrough
technology MGX Minerals controls exclusively. PurLucid has a contract for reprocessing steam water for oil sands
using MGX Minerals technology, the construction of a full commercial
7,500 Barrels-Per-Day (BPD) system is being made possible by $8.2M
in government grant (see related
November 6, 2017 news) -- this is the
beginning roll-out of what we expect will be a robust water-handling
business line. This first large-scale commercial plant will also be leveraged
for MGX Minerals benefit as a site-visit demonstration
facility to propel the lithium side of the business, as this plant
will employ
the same technology.
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Near-term share price target: $5+/share for CSE:XMG
;
MGX Minerals Inc. currently has a market cap of ~C$77 million (~77.6 million
shares outstanding trading at ~$0.99/share), this Mining Journal
projects that sometime in 2018 MGX Minerals Inc. will surpass $500M
market cap, on its way to much much higher valuation, with little
(if any) share dilution -- all translating to a significantly higher
share price. The Company has a plethora of NDAs signed and is
currently negotiating several commercial contracts. MGX has bulk
sample tests
from numerous primary sites and proposals
are going out, no doubt the Company will land some of those. Over the
coming months we expect the markets to witness revenue and lithium
streaming contracts generated, and the question will become "How big
does this get?" We expect to see a series of good size proposals
being accepted, many covering millions of dollars each in lithium. Once MGX
surpasses $10 million in revenues the market will start to price in
serious projections and any perceived risk will melt away,
accelerating valuation. As earnings play out and contracts take off
a $1B market cap in 2019 is not unrealistic. The Company has the
ability to vertically integrate and partner right now. Look at how
fast the second largest Lithium producer in the world came to being
what it is, Ganfeng (out of China), they were not even in the
Lithium business in 2006. Through a stroke of the pen and
negotiations through some good deals, access to capital, and
deploying capital well, a multi-billion dollar market cap is
possible. There is no doubt shareholders establishing a long
position now stand to be richly rewarded from the strategic
advantage MGX Minerals Inc. has in its proprietary technology, now
at the initial phase of commercialization, and in a marketplace as
the only viable solution we are aware of for complex high Mg:Li
ratio lithium brines, with exceptional economics, combined with
increasing global demand by EV/Li-ion battery manufacturers
thirsting to secure supply.
Although the main value of MGX Minerals Inc.
currently rests in its ownership of disruptive-like technology, the
company is also amassing a respectable portfolio of brine holdings.
MGX is the largest holder of Li brine holdings in North America,
it has ~2 million acres under staking options under a variety of
arrangements, and the Company is constantly entering new JV's
and deals to acquire more brine where it sees opportunity. MGX has
one of the largest exploration programs underway in North America to
identify areas of brine, with the big advantage of being the
exclusive 100%-owners of unique technology that renders the Mg:Li
ratio moot.
Marc Burner, MGX Minerals’
Chairman, wants to replicate the success he had with Ultra Petroleum;
under his stewardship he took it from ~$10 million market cap to ~$16
billion:
Mr. Burner sees that type of potential in this
untapped subsector of petrolithium extraction and big-lithium
pure-play. He was attracted to MGX Minerals because of his deep
understanding of the opportunity, and the fact MGX Minerals exclusively
controls the IP to accomplish this. Mr. Burner is a second generation
oil-and-gas businessman. His father started a company called Texas Oil
and Gas, and when he sold that to US Steel, it was the biggest
independent oil and gas company in the world. Mr. Burner's
claim to fame is being one of the pioneers of the unconventional oil and
gas business. Mr. Bruner was previously the Chairman and CEO of Falcon
Oil & Gas Ltd. and served as Ultra Petroleum’s founding Chairman where
he was involved in developing the Pinedale Anticline in Wyoming, which
is now recognized as one of the largest unconventional natural gas
fields in the United States. While serving these companies, Mr. Bruner
oversaw negotiations and contracts with global oil and gas companies
including Halliburton, Exxon Mobil, Questar Gas and Hess Corporation. In
addition, Mr. Bruner founded Pennaco Energy Inc. to explore and develop
coal bed methane properties in the Powder River Basin of Wyoming and
Montana. In March 2000, the company was sold to Marathon Oil for US $550
million.
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Traditionally a high Mg:Li ratio
made for problematic complex brine, now (because of
MGX's technology) a high Mg:Li ratio can even be seen as
better than clean brine as MGX can extract all in situ
minerals for sale.
Figure 4.
Periodic table of elements
examples of diagonal relationship. A diagonal
relationship is said to exist between certain pairs of
diagonally adjacent elements in the second and third
periods of the periodic table. It is found that the
chemistry of a first-row (second period) element often
has similarities to the chemistry of the second-row
(third period) element being one column to the right of
it in the periodic table. Thus, the chemistry of Li has
similarities to that of Mg.
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The
Back-Story
Why MGX Minerals' technology is so
effective &
how the Company secured 100%-ownership of the IP
In the production of oil and gas a lot of
environmentally unfriendly brackish water is produced which cannot
be dumped. Besides contamination from hydrocarbons, the
brackish water is mineral-rich (primarily salts), however these
hydrocarbons and minerals have commodity value if extricated individually and cost
effectively, which was not possible prior to MGX Minerals’
petrolithium extraction technology being developed. The presence of
magnesium in high levels also presented a problem when attempting to
extract lithium as both lithium and magnesium behave similar
(sharing a diagonal relationship on the periodic table of elements)
making them extremely difficult to separate -- MGX's technology
solves this...
Sequential
separation using specialized floatation and reagent coated nano-filters,
each filter attracts its own unique element:
Petrolithium technology involves the ability to have
oil, natural gas, and now mineral extraction occur all at one well.
The process involves complex floatation and nano-filtration
technologies, these are new technologies which have only been around
for less than a decade since inception, and the natural
commercialization of the technology is now hitting the market with
MGX Minerals holding the exclusive IP rights. The key to this
technology is sequential separation – a specialized coated filter
for each element/mineral results in a clean lithium product. Up
until MGX Minerals' process, technologies for Lithium extraction
focused on isolating the lithium first and foremost (if not
entirely) and that made it difficult to obtain a clean lithium
product. Now, by having a filter that pulls the sodium, magnesium,
calcium, potassium, boron, individually in a specific order clean
lithium brine can be obtained from what was once complex. The filter
is nothing like a traditional mesh filter, these are reagent coated
filters each designed to pull a specific element, it is a nano-filtration
technology where the filter itself works like a magnet and attracts
specific molecules via design construction and the use of reagents
-- each filter attracts its own unique element. As the filter fills
up like a regular filter, it backs-up and hits a pressure switch and
backwashes into a tank.
The core technology
was developed to clean up the oil sands (oil sand tailing
waste is some of the nastiest on the planet) so it is total overkill
when it comes to tackling ordinary oil & gas brine, and that is what
is making the technology so much easier to roll-out now. MGX
Minerals Inc. is now the only group that can handle ultra-high total
dissolved solids; there are no other filtrations that we are aware of
that can deal with total dissolved solids beyond 40,000 PPM. MGX can deal with 400,000+ PPM without issue --
all because this was designed for the oil sand tailings. All oil &
gas companies ask "how do we cut our water costs and physically
reduce water disposal?" -- everyone is looking for long-term water
solutions.
The process was originally invented by the team at PurLucid
Treatment Solutions, a company which MGX Minerals currently owns
~34% of and has the the rights to purchase 100% (in exchange for a
relatively nominal amount of stock). MGX already owns 100% of the key
technology, having already paid for the lithium and mineral
extraction technology and any improvements on that technology in the
future, so that value does not exist in PurLucid. But there is
serious value in the people/knowledge-base and other technology PurLucid has. Purlucid is a valuable consulting Company at the
forefront of water treatment and lithium extraction. The Company has
top people in the field; e.g. the chief scientist was the head of
R&D for Tervita, the largest water treatment Company in Alberta.
When oil had a down turn it a few years ago it was just at the point
PurLucid was looking for a corporate partner (as is required by the
government to demonstrate/facilitate weaning off of government
grants, a private partner was required to apply for more grants),
that is when MGX Minerals stepped in. Essentially PurLucid was at
the phase that it could qualify for multi-millions and MGX Minerals
recognized the value of the technology. PurLucid's invention makes up the front-end of
MGX's rapid lithium extraction technology, its the most important
part. The people at PurLucid have produced
a number of systems in the past and are important for MGX Minerals
now, as they are experienced on the engineering side, manufacturing
side, development side, and provide guidance on how to commercialize
what MGX Minerals now controls. |
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Superior economics compared to solar evaporation
On a head-to-head bases MGX Minerals' Rapid
Lithium Extraction System outshines solar evaporation. At first
blush, solar evaporation may seem cheap (letting the sun do the work
passively), however its clearly not the case:
- Lower
system capex & lower opex;
- More
efficient: 70+% recoveries of Li vs. ~40% for solar evaporation;
- Faster
end-to-end time: ~8hr vs. ~18 months;
- Much smaller
footprint: miles of evaporation ponds are not necessary with MGX's
technology;
- The
equipment is modular (containerized) & scalable;
- Able to
handle high Mg:Li ratio;
- Plus there
is the benefit of
usable freshened water as an end product.
Solar evaporation just doesn't compare in terms
of capital and efficiency. Lithium analysts have
discussed with this Mining Journal comparative costs with the belief MGX can go head-to-head
with solar evaporation at less than 1/2 the capex cost, and less
than 1/4 the opex costs. Also because MGX's system is scalable it
can be rolled out in phases, scaled-up over time in say US$4M
increments (e.g. a 7,500BPD system would cost near ~US$2M for the front-end
sequential separation technology, and ~US$2M for the back-end evaporation unit).
Depending on grade, say 350 mg of Li/L grade for example, on a single
7,500 BPD system, we calculate >200t of Li-carbonate/year, >US$2,000,000 in revenue/year
could be generated (based on a conservative commodity price of US$10,000/t for Li carbonate). In areas
where there are high total dissolved solids an operator is also
going to have a plethora of low value companion commodities (e.g.
boron, sodium, calcium, etc.) which will generate additional kicker
revenue. A potentially very profitable undertaking with no massive capital risk. It is such low level of capital required to deploy MGX Minerals system, in most instances it could be facilitated via
lease and debt financing, or even potentially off-sheet via JV
partners. The ability to advance lithium brine projects in a modular
way makes for a very attractive proposition. Larger (big-lithium) MGX
Rapid Lithium Extraction System projects may better lend themselves to
building-out centralized evaporation infrastructure on the back-end to take
advantage of economies of scale. The traditional number for opex for solar is ~$5/barrel,
MGX is ~$1/barrel on opex comparison basis for clean brine with only
1 operator required to man the pumps and normal use of reagents.
This is what happens when you have a paradigm shift. MGX is using
passive filtration technology to process on the fly whereas
traditional solar evaporation engineers are having to line miles and
miles of ponds, getting lower recovery, it takes close to 2 years to
get an end product with solar evaporation vs. residence time in the
filters of ~8 hours from end-to-end for MGX.
Going beyond petrolithium and
targeting big-lithium pure-plays: MGX Minerals Inc. has
the petrolithium side of the business tied-down, the Company is
going to do very well in petrolithium as it has the only mineral extraction
technology possible to deal with what oil & gas companies are
looking for. It is just now seeing the first of many new systems
that will dominate that sub-sector. But the 'Fortune-500 money
Company-maker' potential for MGX Mineral shareholders is in the
lithium pure-play side. MGX Minerals is looking at very
large brine sources, inland lakes/inland seas, very large mine
tailings fluid scenarios, South America brines, these types of
operations can support mass production. When MGX first looked at
making its technology work (with petrolithium) it looked at trying to make tight
economics projects work, the Company looked at making 70 mg of Li/L work
-- that was its break-even for chasing lithium. Then when MGX
Minerals started
to spread its wings and look around and talk to other lithium
companies it recognized that the economics became massively
rewarding as the grades increased. MGX is opening its office in
Chile as it is well connected there -- it is not unusual to find brines
in South America near 500 mg of Li/L. The reason MGX's system becomes so profitable
is because as you scale up, things like operator costs (e.g. your labor costs) as a percentage drop
and your main costs
are reagent and consumable costs, the overwhelming majority of
consumable costs are related to minerals/elements other than Lithium.
There is not a significant difference in terms of reagents whether you are
extracting 70 mg/L or 500 mg/L of lithium, you are still in parts per
million, it’s so small. An increase in Lithium grade translate
to gains in revenue and adds nothing to costs.
Full copy of the Mining Journal Review may be viewed at
http://miningmarketwatch.net/xmg.htm online.
This release may
contain forward-looking statements regarding future events that
involve risk and uncertainties. Readers are cautioned that these
forward-looking statements are only predictions and may differ
materially from actual events or results. Articles, excerpts,
commentary and reviews herein are for information purposes and are
not solicitations to buy or sell any of the securities mentioned.
Readers are referred to the terms of use, disclaimer and disclosure
located at the above referenced URL(s).
SOURCE: Sector Newswire editorial
editorial@SectorNewswire.com
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