MGX Minerals completes gasification scoping study

Nov 21, 2018

2018-11-21 02:40 ET – News Release

Mr. Jared Lazerson reports

MGX MINERALS ANNOUNCES COMPLETION OF GASIFICATION SCOPING STUDY FOR PETROLEUM COKE TO HYDROGEN WITH VANADIUM, NICKEL AND COBALT EXTRACTION

MGX Minerals Inc. and Highbury Energy Inc. have completed a comprehensive study, analyzing beneficial gasification routes from petroleum coke to three products of value: hydrogen, FT liquids and fuel gas. Each of these products has potential markets in the oil sands and heavy oil industry. The report outlines a variety and comparison of plant design parameters and a Petcoke-to-Hydrogen process with metals concentration via gasification, utilizing Highbury’s patented dual-bed gasification technology, which requires no fine grinding or air separation unit. The goal of ongoing joint research with Highbury is to develop fuel source alternatives and concentrated battery metals by-products including vanadium, nickel and cobalt, which can be seamlessly integrated into existing refinery operations. The study is viewed as positive and the project will now move to the demonstration plant design phase and preliminary pre-feasibility analysis.

Metals in Pet Coke and Ash

Previously released assay results of Petcoke samples collected from stockpiles produced from the Fort McMurray area mining and upgrading operation as well as an Edmonton refinery are summarized below. Both samples originated from Delayed Coking operations. Samples were obtained and prepared by Highbury and metal contents analyzed by Acme Labs of Vancouver, British Columbia using standard ICP analyses.

Ash Content

Ash content was determined by weighing residues after burning coke samples of about 200 g in air in a muffle oven over extended periods at 815degreeC. Table A indicates the average ash content of 6 to 7 samples of each coke.

Ash Content of Coke Samples

Sample name    Ash content (% wt.)No. of samples tested
Upgrader Coke A2.73 plus or minus0.09         6                    
Refinery Coke B0.32 plus or minus0.04         7

Upgrader Coke A had about nine times as much ash as was in Refinery Coke B.

Proximate Analyses

The cokes contain over 95 % organic (non-mineral) matter. Thermogravimetric analyses on 10 mg quantities are shown below.

Proximate Analyses of Coke by the Thermo-gravimetric Analyser Method

Quantity (wt. %)Upgrader Coke ARefinery Coke B
Volatile Matter 8.9            10.0           
Fixed Carbon    86.9           86.3           
Residues        4.3            1.7

Residue refers to residual mineral matter left after the thermo-gravimetric test. Except for the % Residue, the two cokes have similar combustion properties.

Metals Analysis in the Coke Samples.

Lithium borate fusion ICP-MS method measures 45 trace metal concentrations in the coke. Results are expressed as (mg/kg) or ppmwt. Table C lists concentrations of selected metals.

 Selected Metal Concentrations in Coke (mg Metal/kg Coke)
Sample          V   Ni   Cu   Zr   Co  Au      Ag   
Upgrader Coke A 421 76.8 86.2 40.5 4.8 0.0011  < 0.1
Refinery Coke B 458 53.4 35.9 1.3  1.3 <0.0005 <0.1

Vanadium is the highest concentration of the 45 trace metals detected in the coke samples.

Ash Analyses

Ash analysis was completed by Bureau Veritas Commodities Canada Ltd. ("BV") of Vancouver, British Columbia using XRF method (XF701). Results are expressed as % wt. in the ash as oxide. Sixteen elements as oxides, and LOI (loss on ignition) are determined. The ash samples were prepared in Highbury’s laboratory and sent to BV for analysis. The maximum % the analysis method could accommodate was 10.0 % for V2O5; therefore ash samples were diluted by mixing with other solids. In the Highbury laboratory both Al2O3 and Fe2O3 were used.

 Selected Species in the Ash of Each Coke TypeSpecies (wt. %)

Upgrader Coke Ash ARefinery Coke Ash B
Al2O3          27.7               9.8                
SiO2           42.6               23.6               
V2O5           6.6                45.1               
Fe2O3          8.0                2.7                
TiO2           5.7                0.7                
K2O+MgO+CaO    4.0                6.4                
LOI            0.0                4.3                
SubTotal (wt.%)90.8               92.5

For Upgrader Coke A, the sum of Al2O3 +SiO 2 is about 70 %. V2O5 is about 6.6%, according to the ash analyses. For Refinery Coke B, the average % V2O5 in the ash is 45 %.

Table E. Trace Metals Concentration in Ash (mg Metal/kg Ash) for Selected Species [Two Determinations Average]

 Sample              V     Ni     Cu  Zr   Co  Au   Ag    Mo  
Upgrader Coke Ash A 34600  740    130 1840 230 0.02 2.5   1405
Refinery Coke Ash B 193000 177000 340 405  620 0.02 0.175 5000

Vanadium metal concentrations are 3.5 % wt. in Upgrader Coke Ash A, and 19.3 % wt. in Refinery Coke Ash B, which is also enriched in Nickel.

Background

Petcoke is a carbon material by-product of the oil and gas industry that forms during the oil refining process. As refineries have become more efficient at processing extra heavy crude oils (bitumen) over the last two decades, output of petcoke globally has risen significantly. Because petcoke originates from heavier petroleum fractions, its denser impurities such as metals and sulphur compounds are concentrate in it.

The majority of Canadian petcoke output occurs in close proximity to oil sand producing regions, where bitumen is upgraded into synthetic crude oil. Specifically, the Province of Alberta is known to host vast stockpiles of petcoke. According to the Alberta Energy Regulator, petcoke inventories are estimated to have reached 106 million tonnes in 2016(1).

(1) Source: Alberta Energy Industry, Alberta Mineable Oil Sands Plant Statistics

Research and Development

Development of the detailed process will be spearheaded by Dr. Paul Watkinson, a Professor Emeritus in the Department of Chemical and Biological Engineering at the University of British Columbia and a co-founder of Highbury. Dr. Watkinson is a published expert in the field of gasification and oversaw early work on related oil sand gasification in the early 1990&#8217;s. He is also a registered Professional Engineer, Fellow of the Chemical Institute of Canada and Fellow of the Canadian Academy of Engineering. Dr. Watkinson is also an active participant in the Canadian Society for Chemical Engineering as well as Engineering Conferences International. He has received numerous awards for his research and has published multiple articles in scientific journals on pilot-scale investigations of conversion of carbonaceous solids, such as coal, shale and biomass, into gaseous and liquid fuels.

N.I. 43-101

Although authored by leading experts in the field and significantly advancing research and development of gasification and metals extraction, N.I. 43-101 does not recognize a scoping study as a N.I. 43-101 Compliant Report. As such MGX cannot release any economic projections whatsoever in regard to metals extraction or associated gasification steps. As Petcoke is widely available in very large quantities at low cost in the Alberta Oil Sands it is unlikely MGX will complete an N.I. 43-101 Resource Estimate, which precludes a compliant Preliminary Economic Assessment, Pre-feasibility Study or Feasibility Study that would allow for the release of economic projections. It is anticipated that a Pre-feasibility and Feasibility Study will be completed for the plant design itself but not the Petcoke resource as it will be purchased as needed and not owned or controlled by MGX.

Qualified Person

Andris Kikauka (P. Geo.), Vice President of Exploration for MGX Minerals, has reviewed and approved the technical information in this press release. Mr. Kikauka is a non-independent Qualified Person within the meaning of National Instrument 43-101 Standards.

About MGX Minerals

MGX Minerals is a diversified Canadian resource and technology company with interests in global advanced material, energy and water assets. Learn more at www.mgxminerals.com.

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