Overzealous government regulators spurs metal demand
By Andrew Mickey
The EU has demanded that manufacturers no longer use unsafe levels of lead in the making of any electrical or electronic equipment. The EU has implemented a complete ban on lead in these products by 2010.
Thogus Products, a small company in the suburbs of Cleveland, has an ingenious solution. Using a tungsten compound, the company has the ability to replace lead in all kinds of applications. In particular, the tungsten compound has the same specific gravity of lead and shields radiation as well as or even better than lead. The tungsten compound can be used in ammunition, collimators, X-ray tube housings, and other medical-shielding applications.
Basically, Thogus has the ability to create polymers nylon 6 and thermoplastic polyurethane. The products sound complicated, but they are plastics that are flexible and have hundreds of uses, but commonly used as joiners in pipes or machinery. Also in the medical field, these plastics are used for replacement joints and blood bags, because the medical industry is moving away from using any products with animal-based components.
Thogus has a partnership with Dow Chemical to improve its products as well as create new ones. You might already know that oil is used to make plastics, but tungsten also has the unique chemical properties that allow it to be transformed into a strong plastic that can hold up to lots of wear and tear as well as extreme temperatures.
Tungsten has another funny little connection to oil, which is that it is the prime component of an oil drill bit. All oil-drilling companies absolutely need tungsten in order to continue exploration efforts to locate more of the petroleum that the world is demanding.
And oil exploration (requiring these kinds of tungsten drills) is experiencing a boom of its own right now, as countries around the world scramble to discover new sources of oil and gain energy independence from unsavory partners. This movement is translating into a huge surge in demand for the oil drill bits made from tungsten.
For instance, Dril-Quip (DRQ: NYSE), a Houston-based offshore drilling equipment company, uses tungsten bits for its products, and it recently rode the wave of demand for oil exploration equipment to record highs.
From 2003 up until this year, Dril-Quip’s share price shot from $6.27 all the way up to $52.04 -- a 730% increase! And other oil drill producing companies are experiencing very similar run-ups in value.
Weatherford International Ltd. -- up 260%...
W-H Energy Services – up 375%...
Baker Hughs Inc. – up 233%...
Grant Prideco Inc – up 470%...
This is the kind of incredible demand that the oil industry has for new drilling equipment, all made from tungsten.
And that’s why I’m so excited about the latest tungsten play I’ve uncovered. You see, this tiny company has amassed quite a few high-grade tungsten properties.
Tungsten prices are set to soar, and this tiny relatively unknown company has loads of the stuff. Just a couple of weeks ago it announced its official tungsten holdings in one of the company’s smaller projects and found 60% more resources than it initially had thought were there.
Essentially, the company stumbled across an additional $100 million worth of rock. And the property is still only half explored. Now it has finally aligned the right people to get its first project underway. But there’s a lot more to the story than that and you can learn all about it here.
That’s all for now,
Andrew Mickey,
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