Industry Bulletin - Gallium - little-known metal plays a key role in Solar Power, LEDs and soon-to-be Hydrogen-fueled cars
May 31, 2007
In our on-going efforts to provide you with broad communications and industry information, we are pleased to share some recent updates on the rare metal - Gallium. Gallium is a soft silvery metallic ´poor metal´... the latter term sometimes used to categorize the group of 10 elements which includes aluminum, gallium, tin, arsenic, lead, and bismuth. These "poor" metals, also sometimes referred to as ´metalloids, have properties of both metal and non-metals. Gallium is one "poor metal" that is enriching our lives and saving the environment through its critical application in new technologies such as energy efficient solar panels, LED lighting and recently-revealed hydrogen fuel production.
Michael Schmela, Editor-in-chief of Photon International reported in his May 11th and 18th issues that the PPVX outperformed the AMEX oil index by 30% year-to-date 2007. [The PPVX or Photon Photovoltaic Stock Index is a German-based index that tracks the performance of publically traded renewable energy companies around the world. A fuller description is provided as a reference note at the end bulletin]. The growth in solar power is also reflected in David Parkinson´s March 16th piece in the Globe & Mail where he reported that the global demand for solar power or PhotoVoltaics (PVs) has been rising at 20-30% per year, as the declining costs of PV generation, relative to conventional electricity continue to encourage more jurisdictions to turn to solar.
One of the PV technologies enjoying increased acceptance is CIGS (copper-indium-gallium-selenide) thin film. In January of this year, Solar Thin Films based in Budapest, Hungary announced further developments in the manufacturing of equipment for CIGS-based thin film PV modules. In April 2007, Solyndra announced that it raised just under US$80 million for its CIGS program. Rival Nanosolar raised $100 million last year, while Miasolar is expected to come out with its first commercial CIGS cells shortly. While CIGS solar panels may be less efficient than traditional silicon solar cells, CIGS can be applied to thin sheets of plastic or metal, making CIGS solar cells much less expensive to manufacture and easier to install.
As reported in our Industry Bulletin on April 23rd, the global policy shift towards banning incandescent light bulbs, to be replaced by compact fluorescent lamps (CFLs) and light emitting diodes (LEDs), is also gaining momentum. The goal is to dramatically reduce energy consumption used in lighting. Gallium and other rare earth elements are important ingredients in the semiconductors that comprise LEDs. With this increase in demand, LED developers and manufacturers will continue to improve the quality of light and drive down the cost of each unit. LEDs are clearly the way of the future, with CFLs increasingly seen as an interim step as they present their own environmental management issues around mercury disposal and are less energy efficient.
Science and technology, and the global commitment to finding energy efficient and environmentally beneficial solutions that will serve us well into the future continue to accelerate. In a recent article Fuel for the 21st century - Aluminum Pellets, US Scientists describes the recent innovation where pellets made of aluminum and gallium can produce pure hydrogen when water is poured on them, offering a possible alternative to gasoline powered engines.
The increased demand is translating into higher prices for gallium which have risen from US$300/kg two years ago to approaching US$1,000/kg today. Avalon has yet-to-be-quantified gallium resources on both of its Thor Lake and East Kemptville rare metals projects. At Thor Lake, NWT, the gallium occurs in feldspars, which have historically been considered too difficult to process to economically recover the gallium.
However, metallurgical technologies do exist for extracting gallium from feldspars and in the context of higher demand in prices, Avalon is planning to investigate the feasibility of applying these technologies to its gallium resources at Thor Lake. Gallium also occurs in association with zinc at the Company´s East Kemptville Tin-rare metals project in southwestern Nova Scotia. The tenor and recoverability of the gallium mineralization in this resource has also yet to be quantified.
- The PPVX began on Aug. 1, 2001 with 1,000 points and is calculated weekly on a euro base. Currently, it includes 30 stocks listed on the market in different countries. To be included in the PPVX, more than 50 percent of a company's sales in the previous year must have come through PV products or services. The PPVX index was at 3643 on May18, 2007
Index calculation: The PPVX is a weighted index so that the stocks of a few highly capitalized companies do not exert too much influence. It is divided into five classes, with different weighing points based on the companies' market capitalizations.
If you have any comments or questions, please do not hesitate to post them on Avalon's official investor relations hub at http://www.agoracom.com/IR/Avalon