No market demand for more barite
July 9, 2020
In the July 2 CVN, Dave Werner wrote a letter to the editor asserting that mine industry expert Jim Kuipers’ analysis of Constantine Metal Resources’ preliminary economic assessment (PEA) for the Palmer Project was a “scam,” in that it calls into question the marketability of barite. Werner suggests that barite will be trucked directly to the North Slope. This is incorrect.
At Constantine’s mining forum in March, Constantine President Garfield McVeigh explicitly stated that the barite will NOT go to the North Slope. He said it “will be trucked into town, and then loaded on the barge and shipped to Prince Rupert,” where it would be distributed to central Canada and the central United States.
McVeigh stated that the North Slope market is “not a really large market.” While McVeigh speculated that demand could increase, that is pure speculation.
As Kuipers points out in his well-researched, well-cited report, there is already an ample supply of barite produced from mines in Nevada, and additional barite mines sit idle in the Lower 48, according to the U.S. Geological Survey. Kuipers cites the average price of barite at $77 per ton versus the PEA’s speculative price of $220 per ton, and goes on to state that “it would most likely require a significant shortage of supply in the face of significant demand, which is not present in the current North American oil and gas drilling sector, for the price of barite to increase to the level projected in the PEA.”
This is math and economics, not “environmental extremism.”