MGX Minerals’ (XMG.C) stock chart is a hockey stick and it started its phenomenal rise. Currently it sits at $2.42 per share and just 12 days ago, it was at $0.72 per share. That’s a 245% jump in market cap and I’m sure there’s more than a few lucky longs who are dancing in their living room.
Why all the excitement?
MGX is engaged in the extraction of industrial minerals and currently operates magnesium, lithium and silicon projects throughout British Columbia and Alberta.
I can see you’re not impressed, I mean there are more juniors than you can shake a stick at who are hitching their wagon to the metals of tomorrow. So, again, why all the excitement.
Well, I wrote up MGX on the 18th of this month to talk about the progress they were having with a little thing called petrolithium.
This is a serious game changer and I’ll tell you why.
MGX is part of a new wave of miners, developing environmentally friendly and ecologically positive mining methodologies that slot in nicely with our 21st century society.
We need lithium in a big way if we intend to push the green energy revolution forward.
Traditionally, lithium is pulled out of the ground in hard rock mining or extracted from lithium brine reservoirs. Both techniques require the development of new mining operations – a costly, time intensive process.
Petrolithium, on the other hand, rides piggy back on existing oil and gas projects and extracts minerals from waste oil-field water.
And there’s a lot of that in Alberta.
In fact, there is a recent report put out by the Alberta Geological Society (“AGS”) which studied the lithium-rich formation water in the province, more specifically that in the Fox Creek area of West-Central Alberta that confirmed it.
The report found anomalous lithium concentrations of up to 140 mg/l in lithium-rich oil-field waters located in the Leduc and Swan Hills formations.
A historic non-National Instrument 43-101 compliant report puts the lithium resource estimate for Swan Hills, Leduc and Beaverhill Lake formation waters at 515,000 tonnes over an area of 4000 square kilometres.
As of May 2016, MGX controlled 14 of the top 25 historical high-grade lithium properties mentioned in the AGS report.
MGX then moved on its opportunity and at the beginning of the year, the company announced that it had successfully extracted lithium from heavy oil waste water with its patent pending process.
This world-first tech reduced the process time by 99% compared to traditional lithium brine production utilizing solar evaporation.
So, what once took approximately 18 months to evaporate in the sun, took one day with MGX’s process.
That’s when the markets took serious notice of MGX Minerals and sent its share price on a decidedly upward trajectory.
Capitalizing on its successes, the company announced that it was staking out oil field assets, including lithium brine, oil wells and existing oil and gas infrastructure in the United States.
As of the release, MGX was actively pursuing acquisition opportunities in the lithium brine-bearing areas of Utah with an expectation that the company would commence exploration and acquisition activities in Colorado, Texas and Arkansas in short order.
Then today, the company announced it had appointed unconventional oil play legend, Marc Bruner as Chairman.
Bruner is slated to direct MGX’s petrolithium acquisitions and development for the company’s wholly-owned subsidiary, PetroLithium Corporation of America.
His track record is impeccable and over his 30-year career, Bruner has served as Chairman and CEO of Falcon Oil & Gas, and served as Ultra Petroleum’s founding Chairman where he was integral in developing the Pinedale Anticline in Wyoming, which is recognized as one of the largest unconventional natural gas fields in the United States.
Bruner also founded Pennaco Energy to work the coal bed methane properties in the Powder River Basin of Wyoming and Montana in 1997. He grew the company from an initial market cap of $1.0 million until the company was sold to Marathon Oil for US$550.0 million in March 2000.
Bruner commented on his appointment to MGX’s board, “MGX is the first Company to separate lithium from oil well wastewater. I am excited about bringing my experience in the unconventional oil and gas business into a new industry where creative thinking is required. Being first positions MGX to be the growth leader in this energy industry paradigm shift.”
Company President and CEO, Jared Lazerson, added, “It is with great pleasure that we welcome Mr. Bruner to the Company and position of Chairman of the Board of MGX as well as Director of Lithium and Oil acquisitions for PetroLithium Corporation of America.”
Then he concluded, “Mr. Bruner is one of the original developers of the unconventional oil and gas business and is a rare breed of visionary businessmen able to recognize and advance fundamental paradigm shifts in the energy industry. Among many other assets, in the past 20 years Mr. Bruner built Ultra, Falcon, and Pennaco, an unrivaled achievement in the unconventional energy industry.”
Oh yeah, I didn’t mention that MGX also has a magnesium asset at Driftwood Creek and three high-grade silicon assets throughout British Columbia.
It looks like MGX is firing on all cylinders, it will be interesting to see how this story develops over the next 12 months. Smart investors would be wise to keep this one on their radar, I know I will.
As always do your due diligence before making any investment decision.
–Gaalen Engen
http://twitter.com/gaalenengen
FULL DISCLOSURE: MGX Minerals is NOT a client of EQUITY.GURU and the author has no connection to them, he just wanted to write about what they’re doing.