Thompson Creek Metals Company Inc. is a growing, diversified North American mining company. Thompson Creek has two large operating molybdenum mines, a large copper-gold mine under construction, a stand-alone metals roasting facility, and a number of additional metals properties in various stages of development. All operations are located in the United States or Canada.
Thompson Creek Mine
The Thompson Creek Mine is a primary molybdenum mine located in mountainous terrain with an open pit, mill and tailings facility. It is the fourth-largest primary molybdenum mine in the world. The property is approximately 35 miles southwest of the town of Challis in Idaho's Custer County, a historic mining area.
The mine, which began operations in 1983, uses conventional open-pit mining methods with large electric-powered shovels that can each move up to 100,000 tons of waste rock and ore per day. The shovels load ore into 200-ton trucks to be hauled to an on-site mill (concentrator). A molybdenum disulfide concentrate is extracted from the ore through a series of crushing, grinding, and flotation operations.
Daily throughput of ore at the mill has recently averaged close to 28,000 tons per day. Most of the molybdenum disulfide concentrate produced at the mine is further processed into technical grade molybdenum oxide at the Langeloth Metallurgical Facility in Pennsylvania.
In February 2011, Thompson Creek announced new estimates for mineral resources and reserves (see table below) and a 15-year mine plan (now 14-year mine plan).
Thompson Creek Mine - Mineral Resources 2 (Resources are in addition to the Reserves in the chart above)
Contained Mo (millions lbs)
Measured and Indicated - Total
Additional Inferred Resources
1 The mineral reserve estimates for the Thompson Creek Mine were prepared by mine personnel and verified by John M. Marek, Registered Professional Engineer, of Independent Mining Consultants, Inc. ("IMC"), who is a qualified person under Canadian National Instrument 43-101 ("43-101"), and utilized a cut-off grade of 0.030% molybdenum. Data verification and block model assembly was completed by Michael J. Lechner of Resource Modeling Inc. The mineral reserves were estimated using an average long-term molybdenum price of US$12.00 per pound. The Thompson Creek Mine has limited ability to expand its pit due to limitations on tailing capacity. Therefore, the final pit design reflects the maximum ore capacity that can be produced in the foreseeable future.
2 The mineral resources for the Thompson Creek Mine were estimated using optimized pit shells at a molybdenum price of US$15.00 per pound. Mr. Marek was the qualified person for the estimation of mineral resources.
The Endako Mine is a primary, surface molybdenum mine located near Fraser Lake, 100 miles northwest of Prince George, British Columbia. The mine is operated as a joint venture with Thompson Creek holding a 75% interest and Sojitz Corporation, a Japanese company, holding a 25% interest.
The Endako Mine is a fully integrated facility that began operations in 1965. It includes a concentrator that processes ore through crushing, grinding, and flotation circuits into molybdenum disulfide concentrate, and a multiple-hearth roasting facility that converts the concentrate into technical grade molybdenum oxide.
The Endako Mine consists of three pits. The Endako Pit, the largest, was the focus of mining activity for many years. In January 2008, mining activity shifted entirely to the Denak West pit and during 2008 the Corporation moved the in-pit crusher from the Endako Pit to an area between the Denak West and Denak East pits and began installing an overland conveyor from that location to the mill. The conveyor commenced transporting ore to the mill in March 2009. Plans call for the creation of a single pit by mining the walls between the three existing pits.
In March 2012, the Company completed the mill expansion project at its Endako mine. The Endako mill expansion project included the construction of a new mill, replacing the existing mill constructed in the 1960's. The new mill is designed to meet ore-processing capacity of 55,000 tons per day. Commissioning of the new SAG/Ball mill and rougher flotation circuit was completed in early January, followed by a successful ramp-up to commercial production beginning February 1, 2012. The remaining construction work on the regrind circuit and the pebble crusher was completed in late March. The mill is meeting its design capacity throughput of approximately 55,000 tons per day. The existing 45-year old mill at the site has been shut down and will be left on care and maintenance.
Endako Mine - Mineral Resources (Resources are in addition to the Reserves in the chart above)
Contained Mo (millions lbs)
Measured and Indicated - Total
Additional Inferred Resources
The mineral reserves and resources estimates were prepared by the Endako mine staff and verified by Mr. John Marek of Independent Mining Consultants, Inc. ("IMC"). Mineral reserves are stated on a 100% basis. The mineral reserves and resources estimates are based on a geologic block model of the Endako deposits assembled by IMC in June 2011 using available diamond drilling data through October 2010 and selected blast hole data through May 31, 2011. The reserves evaluation used a cut-off grade of 0.018% Mo and were estimated using a long-term molybdenum price of $13.50 CDN/lb or $12.00 US/lb using an exchange rate of CDN$1.125/US$1.00. The mineral resources evaluation used a cut-off grade of 0.015% molybdenum and pit shells at a molybdenum price of $16.50 CDN/lb or $15.00 US/lb using an exchange rate of CDN$1.10/US$1.00. The mineral reserves and resources estimates for the Endako Mine are based on a 43-101 technical report prepared for Thompson Creek entitled "Technical Report Endako Molybdenum Mine" dated September 12, 2011 and filed on SEDAR on September 12, 2011.
Langeloth Metallurgical Facility
The Langeloth complex, located 25 miles west of Pittsburgh, Pennsylvania, is a world-class facility with a long history of producing high-quality metallurgical products used mainly in the steel and chemical industries. The facility has roasting capacity of 35 million pounds of molybdenum per year.
Four multiple-hearth furnaces are used for the conversion (roasting) of molybdenum disulfide concentrates into technical grade molybdenum oxide (tech oxide), which is sold in powder form or briquettes or converted into pure molybdenum oxide or ferromolybdenum. Two other furnaces process spent catalyst material containing other metals.
A large portion of the molybdenum concentrates processed at the Langeloth facility come from the Company's Thompson Creek Mine. The Company buys concentrates from other mining companies to process at Langeloth and sell in the market, and it also roasts concentrates on a toll basis for third-party customers.
The roasters, which operate at temperatures up to 1,200°F, convert molybdenum disulfide concentrate (MoS 2 ) into tech oxide (MoO 3 ) with a sulfur content of less than 0.1%. The roasters yield gases with sulfur dioxide (SO 2 ). The sulfur dioxide is converted to sulfuric acid (H 2 SO 4 ), a byproduct that is sold to industrial customers. As a result of this pollution-control initiative, sulfur dioxide emissions for molybdenum processing at the Langeloth complex have been reduced by more than 99%.
A portion of the tech oxide produced at the Langeloth complex is converted into a higher oxide grade, known as pure molybdenum trioxide. The process involves sublimation using a special electric furnace where tech oxide is heated until it vaporizes. On cooling, the vaporized oxide returns to the solid state but with virtually none of the impurities inherent in the tech oxide. This pure molybdenum trioxide is used for super alloys, chemicals and catalysts.
Some of the tech oxide is further processed into ferromolybdenum, an alloy consisting of about 60% molybdenum and 40% iron. Ferromolybdenum is preferred by some steel mills and cast-iron foundries in their manufacturing processes.
The Langeloth facility is the largest ferromolybdenum producer in North America, the first site to commercially convert MoS 2 concentrates to technical molybdenum oxide, and the first site to produce pure molybdenum trioxide by sublimation. The site has 147 acres with a solid infrastructure to support additional projects.
What is Molybdenum (Mo)?
Molybdenum is an important industrial metal with unique properties, including a very high melting point (4,750 degrees Fahrenheit). Molybdenum is No. 42 in the Periodic Table.
Essential ingredient in steel alloys used in energy, aerospace, automobile and various other sectors
Improves steel's performance in very high or low temperatures
Increases steel's resistance to corrosion
Key component in catalysts used by petroleum refineries to reduce sulfur in gasoline and diesel
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
Molybdenum Products and Use
First Use of Molybdenum
Molybdenum is usually present in alloy steel used in pipelines and drilling equipment in the oil and gas sector. Its corrosion-resistance is critical for preventing pipeline leaks and for the durability of steel used in proximity to seawater. Molybdenum's high strength and ability to function well in harsh conditions make it ideal for the tough work done by drilling bits and pipe used to reach oil and gas reserves thousands of feet underground.
The addition of molybdenum to stainless steel provides corrosion protection and improves its strength. These properties cause it to be an effective solution to many of the challenges facing industry. Stainless grades containing molybdenum are widely used including in pharmaceutical, pulp and paper and chemical plants, tanker trucks, ocean-going tankers and desalination plants.
Machines that make tools and the tools themselves often contain molybdenum. Drill tools and cutting and shaping edges containing the metal provide extra strength, hardness and resistance to wear and corrosion, and function well in extreme heat. These properties are unique, with few substitutes, and make molybdenum-bearing tool steel effective and cost efficient in many industrial applications.
Superalloy formulas vary widely but molybdenum is often included in combination with nickel and other specialty metals. Such super-alloys are used in jet and rocket engines, power-generating turbines, turbochargers and chemical and petroleum plants, where they are deemed essential due to their ability to perform well in high heat, resist various corrosive forces, and provide excellent surface stability.
Molybdenum adds strength and hardness and helps cast iron tolerate the high pressures and temperatures of modern diesel engines, where it is increasingly used in motor blocks, cylinder heads, turbocharger housings, and engine exhaust manifolds. The alloyed metal allows engines to run hotter, thus reducing carbon emissions, with the added benefit of weight savings to improve fuel efficiency.
Molybdenum as a pure metal is used frequently in small quantities in diverse situations, including use as a powder coating for other metals, such as to improve the wear and friction properties of automotive parts. It is also a component of wiring and connections in electronics, light bulbs, and the coating sprayed in solar cells and flat panel displays.
Molybdenum is a key component of catalysts used by petroleum refineries to reduce the sulfur content of gasoline and diesel. These catalysts have been increasingly in demand as the sulfur content of crude oil rises and as governments mandate lower-sulfur fuels for cars and trucks. Molybdenum disulfide has numerous properties that makes it an efficient lubricant. It recently has been included in high-performance motor oils.
End Use of Molybdenum*
Molybdenum's Physical Properties
Industrial Applications for Molybdenum
Construction/automotive industries, shipbuilding, heavy machinery, offshore pipelines
Biofuel tanks, flue gas, desulphurization in oil and coats units, desalination plants
Construction and transportation, tunnels, food storage, communication
Manufacture of tools and the cutting or shaping of power machinery
Oil and gas pipelines, construction and automotive industries, bridges
Supercharges, aircraft turbine engines, gas turbines, chemical and petroleum plants
Diesel engine motor blocks and cylinder heads, mining, milling and crushing
Mo Metals & Alloys
Auto parts, lamp filaments, glass manufacturing, heat shields, optical coatings
Petroleum hydroprocessing and hydrodesulfurization
High performance base oils, greases, syntethic fluids, bonds coating, friction products
Paints, inks, plastic and rubber products, ceramics
Molybdenum is increasingly being used in automobiles and various industrial products. Adding molybdenum to steel gives added strength and improves the strength-to-weight ratio -- meaning less metal is needed.
Over the past two decades, automotive engineers have included molybdenum-bearing, high-strength steel in their designs in order to produce lighter-weight, m ore fuel-efficient vehicles, which also resist corrosion and yield higher crash-test ratings than older models.
Growing use of molybdenum is also a factor in the chemical and petroleum industries. For example, project managers are favoring molybdenum-bearing duplex stainless steel grades for their strength and lower cost in the construction of large storage tanks.
The need for stronger steel alloys to handle higher pressures, as well as to resist corrosion, explains why molybdenum is being used more frequently and more intensely in oil and gas pipelines.
Steel alloys containing molybdenum perform better than ordinary steel in high-heat and corrosive situations, such as in jet engines, power generating turbines, desalination plants and nuclear power facilities.
World demand for molybdenum has grown at a 4% average annual rate over the past 50 years. This growth was interrupted in late 2008 by economic recession. But, as it did after past recessions, demand growth is likely to resume again when economic conditions improve.
The world's geological reserves of molybdenum are concentrated in China and North and South America. China's reserves could potentially lead to higher production to fill the world's growing needs.
However, while China was a major exporter of molybdenum in the past, the Chinese government beginning in 2004 deliberately reduced molybdenum supply to the rest of the world through production curtailments, export taxes and export quotas. As local high-cost mines closed down near the end of 2008, China started importing large quantities of molybdenum from North and South American producers.
China's Molybdenum Trade Position
Production barely kept pace with growing demand in the past five years and did so only because the molybdenum price rose dramatically in 2005 and encouraged higher production from many sources, including by-product copper mines which account for about half of the world's molybdenum supply.
Molybdenum supply will likely remain relatively constrained for an extended period of time. Molybdenum production at by-product copper mines is not expected to grow significantly. The development of major new primary molybdenum mines will be delayed by difficulty in obtaining financing. China is likely to continue with its strategic policies aimed at keeping its molybdenum mainly for use in its own industries.
The price of molybdenum oxide fell precipitously in late 2008 as steel mills retrenched in the midst of economic recession. However, the molybdenum price is expected to move higher in the medium term, as economic growth resumes, molybdenum demand increases and supply remains relatively constrained.