BacTech Environmental Corp.'s (BAC:CSE;BCCEF:OTCQB;OBT1:FRA) bugs might eat rocks, but the company says what's left over could contain more riches than just precious metals like gold, silver, and copper.
When the company first tested its bioleaching process for extracting elements from mine tailings, there wasn't much of a market for nickel or cobalt.
But now the world is gearing up for the new green economy, and more nickel and cobalt are needed for batteries. The price of nickel per metric ton, for example, has more than doubled to from November 2018 to more than US$23,000 on Friday.
"The world has changed now," BacTech Chief Executive Officer Ross Orr told Streetwise Reports. "There are other ways of getting metal out of (tailings) that didn't exist 25 years ago."
The company also hopes to extract iron and sulfur from the tailings.
For example, the Sudbury basin in Ontario has up to 100 million tonnes of pyrrhotite tailings from 90 years of mining, containing an average of 0.80% nickel and 0.03% cobalt, the company said.
With that current nickel price, "you're getting pretty close to US$20 billion, just in nickel alone," Orr said.
The Catalyst: Expanding Markets
The appetite for the metals is expanding. The global nickel market is expected to grow at a compound annual growth rate (CAGR) of 7.3% from 2021 to 2028 to US$59.14 billion, Fortune Business Insights reported.
The promise of profits is driving more investors to companies with environmental bona fides, like BacTech.
"There's been a massive appetite in capital markets for anything that can be legitimately described as green," longtime BacTech investor Chris Temple, editor of The National Investor, told Streetwise Reports.
"There's been a massive appetite in capital markets for anything that can be legitimately described as green," longtime BacTech investor Chris Temple, editor of The National Investor, told Streetwise Reports.
Orr cautions that totals like US$20 billion may not be possible right away, but they could be on the horizon.
"This doesn't happen overnight," he said. "100 million tonnes is a lot."
The company has opened a pilot facility in Sudbury to begin processing the materials.
Pyrrhotite, an iron sulfide mineral containing low levels of nickel, cobalt, and copper, has traditionally been discarded as waste by mining operations, leading to a large amount of it being stored in tailings ponds to keep it stable.
"They were dumping this stuff in lakes for the last 100 years to keep it underwater so that it wouldn't oxidize on its own," Orr said. "We're just assisting that process, and then … trying to harvest the results of our labors."
Bugs and Rocks
BacTech's motto, "Our bugs eat rocks," describes the bioleaching, which uses naturally occurring bacteria, harmless to humans and the environment, to extract precious and base metals from ores, concentrates, and tailings. Think of the rocks as a brick wall with sulfur mortar. The bacteria eat the sulfur, causing the wall to come crashing down.
Bioleaching was first attempted commercially in South Africa in 1986, and there have been more than 20 plants built globally since then.
Dr. Nadia Mykytczuk, member of BacTech’s advisory board and president and chief executive officer of MIRARCO Mining Innovation, is leading the development of the Sudbury plant.
MIRARCO has received more than CA$1.6 million from Vale S.A. (VALE:NYSE) and the Ontario government to work on extracting nickel and cobalt from tailings.
Plant in Ecuador
BacTech is also building a bioleaching plant in Tenguel, Ecuador. Last week, it applied for certification as an issuer of Green Bonds to raise the US$20 million needed for the plant, which is in its final stages of permitting.
The company hopes to take advantage of the growing green mining space, which research company Markets and Markets said is expected to grow from an estimated US$9 billion in 2019 to US$12.9 billion by 2024.
Technical analyst Clive Maund went on to rate the stock an immediate Buy.
Green bonds are fixed-income instruments that raise funds to finance projects with positive environmental or climate benefits.
"BacTech is like a poster child for what is legitimately a green cause," Temple said. "It's a green company that's going to clean up toxic material around mines and be able to process troublesome ores."
The company is participating in next week's Sequire Investor Summit in San Juan, Puerto Rico, which is Monday through Wednesday. It will feature training sessions and keynote panels. BacTech is expected to present on Wednesday.
On March 28, 2023, technical analyst Clive Maund shared the chart below.
Maund noted, "On the 5-year chart, we can see how the downtrend from the late 2021 peak brought the price back down to a cyclical low at strong long-term support where an intermediate base pattern has formed. Moving sideways within this base pattern resulted in the price breaking out from the downtrend before breaking higher last month into what is believed to be a new bullmarket, so the reaction back of recent weeks in response to the financing is viewed as presenting an opportunity to buy it at a good price ahead of renewed advance."
Streetwise Ownership Overview*
BacTech Environmental Corp. (BAC:CSE;BCCEF:OTCQB;OBT1:FRA)
He went on to rate the stock an immediate Buy.
Ownership and Share Structure
Nearly half of the company, 49%, is held by insiders, management, and strategic shareholders, the biggest of which is Option Three Advisory Services Ltd., which owns 8.48%, or 15.57 million shares, according to Reuters. That also includes CEO Orr, who owns 3.57% or 6.54 million shares, and Board Director Timothy Lewin, who owns 0.54% or 0.98 million shares.
The rest is retail.
The company has 183.46 million shares outstanding, including 159.12 million free floating. Its market cap is CA$12.19 million, and it trades in a 52-week range of CA$0.13 and CA$0.055.
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1) Steve Sobek wrote this article for Streetwise Reports LLC. He or members of his household own securities of the following companies mentioned in the article: None. He or members of his household are paid by the following companies mentioned in this article: None.
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