Oilfield & Energies

Precious metal mentality

By Sabin Metal Corporation

  Metals price volatility. Owning versus leasing. Insurance and liability. Environmental concerns. The complexit


Metals price volatility. Owning versus leasing. Insurance and liability. Environmental concerns. The complexity of international shipping. Lengthy payment terms. Complicated contracts.
As if the petroleum and petrochemical industries don’t already have enough to worry about… your company now has a full turn-around of a unit containing precious metals catalyst coming up and you have all of the above to contend with as well!
Many responsible parties around the world believe that the first decision to be made is whether it would be best to send the catalyst to a precious metals refiner or simply sell it outright by the kilo. However, selling the catalyst by the kilo is a huge risk, as brokers are offering 50 to 60% of the platinum group metals (PGM) value at best. One metric ton of platinum catalyst is currently valued at about $85K, so this is the equivalent of losing $34K to $43K on every metric ton. In addition, many countries enforce a Grandfather Clause regarding the liability of a corporation, meaning that if you sell your catalyst to a company that disposes of it improperly, your own company may remain responsible for any pollution fines, clean-up and lawsuits.
In fact, refining is the smart choice. Refining – even including international shipping and all costs – still returns a net average over 90% on petroleum catalysts’ true precious metals value. Choosing a responsible and reputable precious metals refiner minimizes your liability by insuring shipments from the point of possession, providing a certificate of destruction where required, and guaranteeing regulatory compliance.
Advantages of refining:
  • Net return after all costs typically over 90% of precious metals value contained
  • Only requires lease or purchase of ‘make up’ ounces for replacement catalyst
  • With proper documentation and good standing, metal advance available
  • Zero liability: fully insured from point of possession and certificate of destruction at finish
Disadvantages of Direct Sale:
  • Net return after all costs typically less than 60% of precious metals value
  • Assets sold at over 30% loss can trigger corruption investigation
  • Replacement catalyst now require full new lease or purchase of platinum
  • Unending liability: uninsured transport and final treatment, and no traceability of proper disposal
In conclusion, make sure your precious metals end up with a responsible recycler, root out and eliminate the unethical and the wasteful, and forge global partnerships. Allow for fair margins, invest in research and development, and discard perceived limitations. Challenge what is ‘normal’. At Sabin, we believe that long-term wisdom and meaningful innovation is best for business and, as a result, best for society and mankind.
If you’d like to learn more about this topic, or other Precious Metal related matters, please visit www.sabinmetal.com.