Scandium, Cobalt, and Water Purification: CleanTeQ Holdings

By hendrixnuzzles, February 6, 2017

A Microcap Teaser Solution In Advance !!
(Australian stock exchange CLQ, OTC pinks CTEQF).
CleanTeQ is sure to be the answer to future teasers you will be reading about from resource gurus, To save you all the trouble of solving them, I decided to write this article.
My portfolio was grotesquely overweight in gold and silver positions, and in moments of anxiety I thought it would be a good idea to diversify and take a few positions in something other than gold mines, royalty companies, Mongolian exploration companies, and small-cap copper miners with major operations in the Democratic Republic of Congo.
Thus I made a small speculation in CleanTeQ, solely on the basis that mining titan Robert Friedland was the Chairman, and CleanTeQ was the only resource company I could find that seemed to be in a position to mine scandium, a very rare metal that sells for a couple of thousand dollars a kilo.
My due diligence was so slight that I was embarrassed to emphasize my position to the readers at Stock Gumshoe. We are supposed to study these things a little more than I did for CleanTeQ. And after entering at 50 cents, the stock promptly dropped to 35 cents or so, making me glad that I did not look foolish by publicizing my position.
As the weeks went by, I started to find more information on the company that I should have found out beforehand. This was partly accidental, partly from other Gumshoe readers, and partly from new announcements and company news that occurred after I took a position. But the findings were all very positive, and because the company is so interesting I thought it warranted its own thread apart from the hard asset thread which I moderate.
I have a full long position and high hopes. And I thank Secretsquirrel, Griffin, Larry McKenna, and several others who helped fill in the missing pieces of the puzzle.
Below are my findings, opinions, and summary on CleanTeQ Holdings:
BUSINESS MODEL CleanTeQ is a hybrid company based with three bases: scandium mining and production, cobalt mining and production, and water purification. This seems like an odd combination, but as you will see, it is not. It is a stroke of genius. And I will explain why we should care about scandium and cobalt.
(1) The company is starting production of the Syerston mine, the world’s only scandium mine;
(2) The company will also produce significant amounts of cobalt as a co-product to the scandium;
(3) The company has a large-scale water purification technology, which will target municipalities,
Industrial operations with waste water problems, and mines, which also have water problems

PROSPECTS FOR THE THREE SEGMENTS
(1) Scandium is a very rare metal that usually occurs in only small amounts that are not economical to mine. It is mostly available as a by-product and the market is opaque, usually between private parties. Scandium has very beneficial applications in aerospace, aviation, and technology, but has not been widely applied because there is not a sufficiently reliable supply of it.
(2) Cobalt is essential in many batteries. Lithium gets all the investment press, but a majority of the battery formulations need cobalt, which is rare compared to lithium. Cobalt has a similar supply situation as scandium, it is mostly a by-product and is not commonly a prime mining target in and of itself. But demand for the electric energy market is growing rapidly and cobalt demand is growing and will continue to grow accordingly. Supply chains on cobalt are iffy.
(3) Water purification is a pressing need throughout the world. Cities with lots of people, industrialized places with lots of factories, or mines with waste water, all have a real and pressing need for large scale water purification. I think most people can accept this premise of widespread demand without a lot of documentation.

HOW DO THESE SEGMENTS RELATE TO EACH OTHER ? I cannot get too technical about the water purification technology, but I will try to explain what I understand, and how it relates to the scandium and cobalt operations. They call it Continuous Flow Ionization. Ionization is not a proprietary technology per se, but CleanTeQ has developed a way to implement ionization in a continuous feed, automated loop that improves volume, improves economics, is reasonably priced for installation, and can be custom-modified to specific waste problems. It can be used in conjunction with other filtration techniques. Further, it can be modified TO EXTRACT CERTAIN SUBSTANCES from the feed waste water. This is done by modifying the resins that are used in the ionization process.

Now it so happens that CleanTeQ has developed resins that can extract scandium and cobalt from waste water. So they potentially will have commercial sources of rare metals from the by-product waste of their water purification process !

HOW CLOSE IS THE WATER THING TO REALLY HAPPENING ? It is happening. CleanTeQ has signed a memorandum of understanding with a major Chinese municipality to implement their technology. There is a joint venture, 55% Chinese/45% CleanTeQ. Once the first one is up and working, China has a mind-boggling potential for water purification. For their teeming urban centers and for their mining and industrial locations, shall we say the potential is very large ?

CleanTeQ has 100% of rest of the world. CleanTeQ is closed-mouthed about other commercial sources, but they let on that they have been in contact with the likes of GE, Dow, and other big hitters. They state a pipeline target of $100 million by 2020; I predict they will do much better.

HOW CLOSE IS THE COBALT THING TO REALLY HAPPENING ? Very close. Battery useage is soaring and is the strategic target of many governments, corporations, and environmental groups. Batteries need cobalt.

HOW CLOSE IS THE SCANDIUM THING FROM HAPPENING ? This will take a while because the applications are high tech, with long lead times, and there is only one scandium mine in the world (CleanTeQ’s newly commissioned Syerston mine). CleanTeQ intends to develop the scandium market by being a reliable source of supply, and by driving the price down.
CleanTeQ will have viable margins with scandium prices up to half of current prices.

To give you an idea, the Russians made a few MIGs with scandium/aluminum alloys. They were faster, lighter, stronger. An addition of 0.5% scandium to aviation aluminum strengthens the frame, removes the need for riveting, reduces weight, and makes repairs easier. . The Russians dropped it because of costs; and Boeing and Airbus will not use it without a reliable source of supply. But there is about to be a reliable source of supply: CleanTeQ.

WHAT ABOUT IP PROTECTION ? I believe the IP and know-how moat is sufficient. CleanTeQ holds a perpetual license from a high-level Russian research organization that provided some of the foundation technology. I am not a patent lawyer and a lot of the know-how will be proprietary, not patented. CleanTeQ has been at this for over ten years, I think the barriers to entry are sufficient.

MANAGEMENT Totally a plus. Robert Friedland is the Co-Chairman and CEO, he has 20% of the company, great credibility and clout with the Chinese, and an unbelievable track record in mining. Sam Reggall is the other co-chairman. I know little about him, other than from my observations of him on an Australian investment show that aired last week. He was impressive.

MONEY AND FINANCES I don’t think there is anything at all to worry about. Friedland must be worth billions, the Chinese are in, and the concept has enormous potential.

Sources: as I mentioned, information is scant. My sources were the CleanTeQ website, presentations and and interviews with Friedland and Reggall, and the sketchy information on the brokerage sites. Nothing you cannot find on your own.

Long CleanTeQ

This is a discussion topic or guest posting submitted by a Stock Gumshoe reader. The content has not been edited or reviewed by Stock Gumshoe, and any opinions expressed are those of the author alone.

Share your thoughts...

2493 Comments on " Scandium, Cobalt, and Water Purification: CleanTeQ Holdings"

avatar

secretsquirrel
Irregular
585
secretsquirrel

Came across this while looking for something else. If posted previously apologies.

Pu Neng is a China-based, industry-leading vanadium-redox-battery (VRB®) technology developer and manufacturer that is 82% owned by HPX (an I-Pulse subsidiary). Pu Neng has the most advanced flow battery technology in the world – its proprietary low-cost ion-exchange membrane, long-life electrolyte formulation and innovative flow cell design set it apart from other vanadium battery providers.

https://www.ipulse-group.com/PUNENG

renbycage
Irregular
431
renbycage

Amazing, Friedland has spiders everywhere, whatever web he is spinning, I like my chances putting my money next to his. He is building an empire for the future, I think he is on track to be the richest man in the world. He looks like the golden goose to me.

Griffin
Irregular
1049
Griffin
Ipulse has been a topic of discussion here albeit for their magnetic pulse technology. Puneng must be where RF has his interest in VRBs. There is not a lot of information on that page for VRBs so I went to their website only to find out I needed a translator installed in firefox. There are several things I’m looking for in a VRB installation 1. they use the electrolyte developed at PNNLthat adds 70% to capacity. 2. the controller on the battery does 3 phase electricity. The only company that I know of that uses PNNL electrolyte is Uni Energy… Read more »
secretsquirrel
Irregular
585
secretsquirrel

Thanks, interesting that Friedland is investing in a Chinese company rather than the other way round. In time their relationship might create some spin off opportunities companies we can invest in?

I know little about batteries or the storage of, but maybe it might be worth noting what they are doing over there….

Wiser heads can comment if anything to be added or gained here.

Griffin
Irregular
1049
Griffin

Information on storage batteries seems to be sparse. There are studies just initiated at PNNL this year on the USA electrical grid that I’m hoping will be a wake up call. Lately there have been several estimates on what a EMF attack might do to the grid and it is pretty devastating. The effect would be bad that North Korea could walk in and take over the USA. IMO the short term fix is storage batteries but even that might be soon enough. Thank you Politicians for doing your job.

renbycage
Irregular
431
renbycage

If you go to page 4, figure 3, of the recent clean teq updated mineral source release, they have a bar graph comparing their cobalt/nickel ratio to all their peers, and basically showing their dick is twice as long as anybody else’s dick. However, they use KNP total for Ardea. If they used Ardea’s high grade cobalt zone, a deposit about half the size as cleanteq’s, and from which they will be mining their cobalt for the next 10 years, then Ardea’s dick would be just a long.

secretsquirrel
Guest
0
secretsquirrel

Yea that’s as maybe BUT AUZ goes on the width/girth being what really matters plus drilling the main hole to depth he he….

secretsquirrel
Irregular
585
secretsquirrel

Btw very Long CleanTeQ and pleased regards AUZ but due to circumstances beyond my control.

Shavian
Guest
0
Shavian

While researching graphene supercapacitors I came across A spinoff from Monash University, Melbourne called Ionic Industries, which has also made abreakthrough with using graphene in water purification, in conjunction with – guess who – CleanTeq. Yet another string to the bow!
http://www.ionicindustries.com.au/ionics-technologies/water-and-wastewater-treatment/

renbycage
Irregular
431
renbycage

there is an option that is dated 9/18 I believe, for cleanteq to take a 75% position on any commercial production resulting from this technology. I can’t remember what cleanteqs obligation is under this option, I think it would be to fund it and take it into commercial production. Ionic is just another one of the great partnerships cleanteq is establishing, Friedland’s spiders are spinning a mega-web.

renbycage
Irregular
431
renbycage

I think I remember they would fund their 75% worth.

SoGiAm
Irregular
9023

$AUZ long – Liking our little Australian Dirt Speculations and Arbitrage 😉 here on this crisp Sunday evening in the good ol’ US of A. 🙂
http://www.asx.com.au/asx/markets/equityPrices.do?by=asxCodes&asxCodes=auz+clq+euc+jrv+ncz+pgm+arl+mei+cob

Johnnn
Guest
0
Johnnn

Those Aussies on HotCopper think AUZ’s cobalt grade at Sconi is .11% when it is really .06%

1 9 10 11
wpDiscuz