BacTec Tests Environmental Mining Tech On Ore From Peru
BacTech Environmental Corp. (BAC:CSE;BCCEF:OTC;OBT1:FRA) has technology that can significantly improve the environmental impact of mining. By using bioleaching technology, the company helps the mining industry achieve its environmental goals. Based in Toronto, BacTech, the business is focused on mining projects in Peru, Columbia, and Chile. The environmental technology company is focused on copper, silver, and gold mining sites that use arsenic.
Bactech to Test 7 Mining Samples From Peru
On February 1, BacTech announced a potential bioleaching project in Peru. The company will receive seven concentrate samples over the next few months. These fifteen-kilogram samples will help prove the value of BacTech's technology further in Peru. The test will focus on copper and gold concentrates. The Peru project samples will be tested at ALS Laboratories in Perth, Australia. Dr. Paul Miller, who holds a Ph.D. in chemical engineering, will guide the testing process.
In addition to the Peru test, BacTech has heard from other companies. "We've had a lot of interest from junior mining companies so far," Ross Orr, President, and CEO of BacTech, shared in an interview.
The Peru test is a crucial step toward proving the value of the technology to the mining industry. "New technology in mining tends to be looked at with furrowed brows. Many in the industry have skepticism about applying new technology in mining. Our technology is different because the underlying innovation is not brand new – it has already been commercialized in gold," Orr said.
Bioleaching: Cleaning Up Mining With Bacteria
Bioleaching technology has been in limited use since the 1980s. According to Genome Atlantic, bioleaching was first used commercially in a South African gold mine in 1986. Bioleaching makes it possible to work with lower-grade ores and extract metals from tailing sites. In simple terms, bioleaching involves using naturally occurring bacteria to process.
While bioleaching itself is not new, there have been few efforts to commercialize the technology successfully. Two recent trends – tax policy in China and growing environmental concerns – are helping to boost demand.
Chinese Tax Changes Create Opportunity
Environmental concerns do not solely drive BacTec's opportunity in South America. In October 2021, the Chinese government imposed a 13% on arsenic gold concretes coming into China. As a result of these tax changes, BacTec fair market value estimates that miners across South America are paid 50% less on their gold ore.
"Miners are telling me that they used to get $500 per tonne, and now Chinese companies are paying them $80 per tonne," Orr commented. "Due to these Chinese tax changes, we're able to pick up higher-grade concentrates and potentially a faster payback," he continued.
BacTec technology may give South American miners an alternative to processing ore in China. Even if China changes its tax rules, demand for alternative ore processing is unlikely to disappear.
US Government Interest in Rare Earth Minerals
BacTec is currently seeking partners. "We would love to work with MP Materials (NYSE:MP) in the United States to help with rare earth minerals. The US government has recently identified rare earth supply as a concern," Ross explained. In January 2022, the U.S. government considered a bill that would block defense contractors from using rare earths from China by 2026. In addition, the Pentagon has identified a rare earth supply chain as a strategic concern.
Since BacTec is based in Canada and currently works in South America, it may help to alleviate US government concerns about dependence on China for critical elements. BacTec can help process and recover gold, silver, cobalt, and copper.
Riding the Growing ESG Trend
In addition to finding partners, financing is a top priority. The company is currently in conversation with potential financial partners. "I'm finding that ESG (i.e., environmental, social, and governance) is a hot topic right now. Our company meets the social element by boosting local employment in South America. In terms of the environment, our technology improves the environment," Orr commented.
Managing the social impact of increasing mine profitability can have brought some unexpected challenges. "Ecuador has a law that states your employees are entitled to a percentage of the company's after-tax profit every year. If we're paying these people $1,000 US a month, which is a pretty good wage for that area, their annual bonus might be several times their annual salary. To manage that windfall, we're educating our employees on saving options like setting funds aside for their children's education," Orr said.
Meeting ESG requirements is an essential priority for many investors. In 2021, Reuters reported that $649 billion flowed into ESG based funds. Governments are also encouraging ESG investing. The U.S. Securities and Exchange Commission created an enforcement task force focused on ESG and climate issues in March 2021.
Significant current investors in the business include Sol Ecosystems which has a 13.6% ownership stake and BacTech management and directors. According to the company's investor presentation, Ross Orr has a 4.2% ownership stake in the business.
