SUPERALLOY BLOG

By Mark A. Smith

April 7, 2020

By Mark A. Smith, P.E., Esq.
CEO and Executive Chairman
NioCorp Developments Ltd.

As U.S. political leaders continue to work on bipartisan strategies that can re-start the U.S. economy once the COVID-19 pandemic begins to subside, one initiative is likely to gain traction among both Democrats and Republicans:  a multi-trillion-dollar infrastructure/transportation program.

See Mark Smith discuss how a U.S. infrastructure / transportation initiative might impact critical minerals producers: https://youtu.be/N_Y4gyP7Ifc

Most elements of America’s infrastructure – roads, bridges, tunnels, airports – are badly in need of repair.  According to the American Society of Civil Engineers’ “2017 Infrastructure Report Card,” almost four in 10 of the 614,387 bridges in the U.S. are 50 years or older.  Most are designed for a 50-year lifespan, so the urgency for action is high.  Moreover, a total of 56,007 bridges — 9.1% —are judged to be structurally deficient, even though 188 million trips are made each day, on average, across these structurally deficient structures.

Fortunately, President Trump and congressional leaders are now seriously discussing a potential $2 trillion infrastructure package that would speed up these repairs, create and support millions of new jobs, and encourage more efficient transportation technologies.

 

What Might This Mean for Critical Minerals?

If this initiative is enacted, it could create a major, long-term demand boom for the critical minerals needed by infrastructure and advanced transportation systems.  Chief among these are the critical metals niobium, scandium, and titanium, all three of which NioCorp intends to produce in southeast Nebraska at our Elk Creek Superalloy Materials Project once we are able to secure project financing necessary to move the Project to construction and operation.

The legislation that Congress is starting to develop may also include financial and other incentives to maximize the use of lighter-weight and more corrosion-resistant materials for roads, bridges, and other infrastructure projects.  These include High-Strength, Low-Alloy (“HSLA”) steel made with niobium, and high-strength aluminum-scandium alloys.  Why would Congress encourage greater use of these materials?  Because both Republicans and Democrats want to see the U.S. national infrastructure re-built with materials that provide taxpayers with a better bang for the buck.  According to a study by the U.S. Federal Highway Administration, bridges that use high-performance steels, such as those with niobium added, were found to deliver longer life spans, a lifetime cost savings of up to 18 percent, and weight reduction of up to 28 percent over traditional bridge design materials.

 

Environmental Concerns Also Will Drive Bipartisan Support

Reducing lifecycle costs in infrastructure is not the only goal that will be sought by policymakers.  They will want to see infrastructure and transportation systems be more environmentally responsible.

That is precisely what critical minerals like niobium and scandium deliver.

The Millau Bridge in southern France, built with niobium-enhanced high-performance steel.

For example, because of the enhanced strength of high-performance steels with niobium, fewer materials of construction are used in infrastructure, and that reduces environmental impacts up and down the supply chain.  For example, the Millau Viaduct in the south of France, the world’s tallest bridge structure, was built with niobium-enhanced HSLA steel.  Niobium strengthened the steel so much that it allowed for an engineering design for the bridge that required 60 percent less steel and concrete than normally would have been used.  That greatly reduced the project’s environmental impacts.

 

Transportation Advances Also Driven by Critical Minerals

While the U.S. works to upgrade its infrastructure systems, investment also is expected to be directed to improving the efficiency of transportation technologies.  After all, lightweighting infrastructure goes hand-in-hand with lightweighting the transportation systems that use this infrastructure.

For example, cars, trucks and buses made with niobium-enhanced steel deliver improved fuel economy and fewer harmful emissions.  They also are stronger, which improves safety for drivers and passengers.

Aluminum-scandium alloys are expected to play a significant role in transportation as well.  Scandium does for aluminum what niobium does for steel.  It gives superplasticity to aluminum alloys, which allows them to survive higher strain and bending forces.  It also allows aluminum alloys to be reliably welded.  Those are crucial engineering requirements for both surface and air transportation applications.

For example, it is estimated that aluminum-scandium alloys promise to reduce the mass of a narrow-body jetliner by up to 20 percent.  Assuming the jet is a B737NG flying 3,000-4,000 hours per year, and assuming today’s relatively low jet fuel price of $1.50 per gallon, that could mean about $1 million – $1.5 million of scandium in a single airliner offers $10 million of net present value fuel savings.  The reduced weight of the plane also would result in significantly fewer air emissions per mile flown.

Not surprisingly, several major aircraft and automotive manufacturers reportedly have been examining the potential use of scandium-contained aluminum alloys.  Some have already invested in the development of prototype alloy parts.  There are hundreds of patent filings and/or approvals related to scandium-contained aluminum alloys.

 

A multi-trillion-dollar infrastructure package now has some serious and bipartisan momentum behind it.  We very much look forward to seeing such an infrastructure initiative become reality.

 

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Cautionary Note Regarding Forward-Looking Statements

Certain statements contained in this blog article may constitute forward-looking statements, including statements regarding the Company’s expectation of certain macroeconomic and geopolitical impacts of the Coronavirus pandemic, actions that may be taken by governments and investors in response to the pandemic, including potential infrastructure and transportation projects, the impact of government actions on demand for niobium, scandium, and titanium, and the Company’s ability to secure project financing necessary to move the Project to construction and operation. Readers are cautioned that such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause a change in such assumptions and the actual outcomes and estimates to be materially different from those estimated or anticipated future results, achievements or position expressed or implied by those forward-looking statements. Risks, uncertainties and other factors that could cause NioCorp’s plans or prospects to change include risks related to the Company’s ability to operate as a going concern; risks related to the Company’s requirement of significant additional capital; changes in demand for and price of commodities (such as fuel and electricity) and currencies; changes in economic valuations of the Project, such as Net Present Value calculations, changes or disruptions in the securities markets; legislative, political or economic developments; the need to obtain permits and comply with laws and regulations and other regulatory requirements; the possibility that actual results of work may differ from projections/expectations or may not realize the perceived potential of NioCorp’s projects; risks of accidents, equipment breakdowns and labor disputes or other unanticipated difficulties or interruptions; the possibility of cost overruns or unanticipated expenses in development programs; operating or technical difficulties in connection with exploration, mining or development activities; the speculative nature of mineral exploration and development, including the risks of diminishing quantities of grades of reserves and resources; and the risks involved in the exploration, development and mining business and the risks set forth in the Company’s filings with Canadian securities regulators at www.sedar.com and the SEC at www.sec.gov. NioCorp disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise.