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NewswireTODAY - /newswire/ -
Sarasota, FL, United States, 2007/03/04 - Repairing aging U.S. oil and gas pipelines could prove a boon to the near-term primary molybdenum companies gearing up their mining operations between now and 2010.
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StockInterview senior editor James Finch analyzed America’s infrastructure and concluded, “Unacceptably high percentages of two key energy-providing vehicles, such as nuclear power plants and the U.S. pipeline network, have begun aging beyond their original design life. About half of the nation’s 2.4 million miles of oil and gas pipelines were built in the 1950s and 1960s. And the composition of the liquids flowing through those pipelines has deteriorated over the past half century.”
Finch pointed out, “During its massive build up phase, U.S. pipeline infrastructure relied upon carbon and low-alloy steels for natural gas and petroleum transportation. As oil fields have aged, the risk of pipeline corrosion and pitting has increased.”
He wrote, “Perhaps the greatest number of new pipeline growth will occur in the United States – the world’s largest energy consumer. By 2025 EIA expects the US will need 47 percent more oil and 54 percent more natural gas. To transport this energy, transmission and distribution line mileage is expect to increase by approximately 30 percent. This implies pipeline projects on the order of some 600,000 miles.”
Those to benefit are molybdenum miners, Finch explained, because of the capital cost required to build a mine and the length of time it takes to bring such a mine into production. Finch concluded, “Despite the rising molybdenum price, now stabilized above US$20/pound, so few realistic molybdenum mining projects appear on the horizon.” And this may bode well for the near-term producers hoping to mine molybdenum through 2010.
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