A rock specimen showing quartz-hosted molybdenum mineralization.Supplied
The rising demand for critical metals – paired with a limited number of new mining projects coming online – can create investment opportunities, says David O’Brien, president and CEO of Stuhini Exploration, a company exploring and developing base and precious metals properties with a primary focus on the advancement of the Ruby Creek molybdenum deposit near Atlin, B.C.
For the past century, the availability of resources has often been taken for granted, and this has led to scarcity of certain metals, he says. “There has been tremendous underinvestment in the sector. As a result, some of the larger discoveries over the past two decades haven’t been developed yet.”
An example where demand is outstripping supply is molybdenum, a key steel alloy for which no substitute is available in many applications, notes Mr. O’Brien. “The most common use, which accounts for about 39 per cent of present molybdenum demand, is for making steel products stronger while reducing their weight. Next, accounting for about 20 per cent of present demand, is for making molybdenum-grade stainless steel.”
Engineering steels, tool and high-speed steel, cast iron and superalloys collectively account for 60 per cent of molybdenum use. While demand for molybdenum is often driven by steel, output is closely linked to copper, since more than 80 per cent of molybdenum production is a byproduct from copper mining. Mr. O’Brien sees this as a disconnect that can be remedied through pure-play molybdenum projects like the Ruby Creek operation.
“There are very few pure-play deposits in the pipeline, and ours is certainly one of the more advanced projects,” he says.
The World Bank recently named molybdenum “an essential green technology metal,” and experts predict that relying on molybdenum as a copper byproduct will result in a significant deficit.
Many of the critical metals needed for the energy transition have undergone changes in valuation and may represent investment opportunities. Mr. O’Brien suggests investors “do their homework.
“For investing in mineral exploration, you have to trust the people involved in the project, and you have to make sure the project is real and tangible.”
Advertising feature produced by Randall Anthony Communications with the Prospectors & Developers Association of Canada. The Globe’s editorial department was not involved.