Mabwe Minerals, a Raptor Resource Holdings (OTCQB: RRHI) subsidiary, along with its affiliate owns 100% of the mineral and metal rights to the Dodge Mine in Zimbabwe, where the company’s primary focus is on the project’s extensive barite deposit. While barite has a variety of applications in the automotive, consumer goods and medical markets, the mineral is primarily used as a weighting agent for the oil and gas industry. This market segment provides a high-potential end market for Mabwe Minerals as vertical drilling technologies unlock greater drilling opportunities worldwide.
Oil and gas is unarguably an industry of consistent growth, which in turn has spurned an increased global demand for barite. China and India are expected to maintain their spot as the world’s top barite producers and exporters, though Kazakhstan, Liberia, Mexico and Zimbabwe are emerging as valuable contributors to global supply.
Growing demand has also triggered an increase in barite prices. According to the U.S. Geological Survey, barite prices increased in 2012 compared with those at year-end 2011. The 2013 report shows that the October published price range for Chinese unground barite ranged between $146-$158 per ton, representing a year-over-year increase of about $22 per ton. The price range for Indian unground barite ranged between $160-$170 per ton, an increase of about $21 per ton, while the price range for Moroccan unground barite was in the range of $140-$152 per ton, a strong increase of about $35 per ton.
Via strategic partners Steinbock Minerals and Yasheya Ltd., Mabwe Minerals has access to the logistics and resources needed to support an established base of barite customers in Europe and the Middle East, as well as the growing demand from the oil and gas sector off the coast of Mozambique and South Africa. Mabwe Minerals also has a 3 million ton supplier agreement with Baker Hughes, a multi-billion dollar oil and gas company with 60,000 employees in more than 80 countries.
More than 75% of all barite produced worldwide is used in the oil and gas industry. Driven by the boom in shale oil and gas exploration, demand for barite is also forecast to see considerable growth within the next five years. In addition to securing partnerships and resources to capitalize on this tremendous end market, Mabwe Minerals intends to further develop its limestone resources at Dodge Mine, as well as follow-up on initial surface level test samples that have confirmed the presence of gold, copper, nickel, zinc and lead.
For more information, visit www.mabweminerals.com
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