Monday, January 22, 2007

Tuned up: the flow of catalytic converters is running steady as platinum group metals prices gain momentum

It's steady as she goes" in the catalytic converter market. The scrap market for PGMs (platinum group metals) is intimately tied to the catalytic converter market. While mined output of basic materials and speculators play roles, it is the catalytic converter market that drives the recycling sector.

"We're pretty steady," says Niel Shalit, CEO of Catalytic Converter Corp., Jamaica, N.Y. His firm deals mainly with recycling yards that produce 2,000 or more units per month.

Ashok Kumar, director of A-1 Specialized Services & Supplies Inc., the Pennsylvania-based multi-national recycler that specializes in lot consolidation and dry processing of salvage converters, says 2004 will end with global recycled production of platinum at 730,000 ounces, palladium at 450,000 ounces and rhodium at 120,000 ounces.

By year 2010, Kumar predicts these numbers will more than double, largely because of the sharply increased retirement of converter equipped cars in Western European countries.
TAKING INVENTORY. Jeff Couture, president of Prospera Metals Inc., Petrolia, Ontario, Canada, says he sees a lot of converters in the marketplace. Things really picked up in March and April Prospera deals in Ontario, Quebec, Ohio and Michigan--areas that had a dreary winter.

"Most scrap yards were pretty lazy getting converters off the yard in January and February," Couture says. "In March and April we were much busier."

Couture says he thinks recyclers were even slower about moving material this winter than in previous ones. But as spring moved toward summer, things began hopping. "Business is strong," he says.

Roughly 10 percent of the world supply of PGMs comes from recycled catalytic converters, a figure that has grown steadily in the past quarter-century.

The impact of this increase in supply from recycling will vary. Since August 2001, the price for platinum has moved steadily up from $450 to $937, setting a 24year high. The principal factor has been increasing platinum demand in Europe for diesel cars, which will make up 50 percent of the vehicles produced in Europe, Kumar says. Platinum is presently the only suitable metal for converters used with diesel cars. In 2000, automakers demanded around 1.9 million ounces of platinum.

In 2004, demand is expected to be 3 million ounces. Kumar says platinum will play a dominant role in the coming years. "The 2007 heavy-duty diesel emission standards in North America and the required reduction of sulfur content from the current levels by year 2006 program will introduce a new perilous outlook for platinum," says Kumar.

Palladium could experience an opposite run. Palladium saw an early April 2003 price of $148--a long way from a metal that was moving close to $1,100 a couple of years ago. ByMayof2004, it had added $100 back to its price, but the first half of 2004 saw it struggling to break out of its bottom-feeding trough.

ACTIVE MINING. Oversupply has hurt palladium prices. The oversupply was because of a run-up in nickel prices. Miners, especially in Russia, saw nickel prices make a nice upward move and logically dug more nickel ... thus extracting more palladium.

Palladium has been tracking at 30 percent of the price for platinum, selling around $300, and most observers say it should not experience a price shock.

"Producers understand and accept that palladium is not going to be at the $1,000 level again," says Kumar. "Perhaps it will remain as a couple-hundred dollar commodity."

Worldwide mine production of palladium already exceeds the current total demand rate of about 4.5 million ounces. Total palladium supply in year 2006 will probably be around 7 million ounces, and the recycling industry itself will provide ample palladium starting in 2009, it is forecast. Palladium is strongly oversupplied, and usage of palladium will remain strong in the coming years,

Rhodium is banging around the $800 mark, having settled back from a record $7,000 all ounce in the early 1990s.

In early May, spot prices for platinum hovered around $800 per ounce, palladium in the $250 range. Platinum was at $625 per ounce in early April 2003 and facing a spot price in the $680-$707 per ounce range--a 23-year high. Less than 15 months later, it was up another $200 per ounce. So much for records. And to think, back in 2002, the average platinum price was $540.03.

"I wish I could gauge the market," Shalit says. "For me, platinum is going up too fast." Like most firms, Catalytic Converter Corp. buys and sells on a daily basis. A steady price is better than one with leaps and bounds--either up or down.

Couture says that the higher prices for converters have drawn peddlers into the market--people offering a relative handful of converters. He says some buyers took advantage of the newcomers' naivete.

As the platinum market moved higher, some people were offering $57-$59 for GM (General Motors) style converters. "That is more than a GM converter is worth refined," Couture says. He says that some buyers were making up their loss on grade, accepting a handful at the high price but buying other converters as "regulars" and not premium items.

MQ Power's new welder/generator - Brief Article

MQ Power Corp. has launched a new welder/generator for use by welding supply houses and the rental markets. Operating as a 225 amp welder and a 6 kW 120/240 volt a.c. generator, the Scorcher 225, manufactured for MQ, Carson, Calif., by Denyo Ltd., is the first model to include constant voltage operation and expands the company's line of welders joining 300 and 400 amp models.

Power for the new welder/generator is a water-cooled, two-cylinder Kubota Z482 diesel rated 12.5 hp at 3600 rpm. The engine comes equipped with an automatic idle control, hour-meter, warning light, fuel gauge, pre-heat lamp and self-priming fuel system. A gasoline version of the Scorcher 225 is due later this month.

One of the primary features of the new set is its lower noise level; 68.7 db(A), according to MQ. The set also features 100 percent duty cycle at 200 amps and a brushless generator design for lower maintenance costs. The automatic idler helps reduce fuel consumption, while the self-priming fuel system aids in restarting the unit.

The package is able to operate simultaneously as a welder and generator and has controls for both CV and CC welding. MQ said the set features outstanding arc characteristics, ideal for welding pipe and structural steel. The system is available with an optional over-the-road trailer.

FWMurphy, Miratech in control systems joint venture

Two well-known companies, FWMurphy and Miratech Corp., recently joined forces to form Compliance Controls LLC. FWMurphy, established in 1939, is an ISO 9001 registered manufacturer of equipment management and control solutions for off-highway and construction equipment, gas compressors, standby generator controls, irrigation and water pumping. Privately held Miratech Corp. and its subsidiary, Miratech SCR Corp., are leaders in the development and engineering of emission control and engine performance technology for industrial engines. Compliance Controls and both parent companies are based in Tulsa, Okla., and have sales offices located across North America.

"The new organization is dedicated to sales, support and continuing development of its state-of-the-art, user-friendly Windows-based air-to-fuel ratio control systems," said Kevin O'Sullivan, president of Compliance Controls. "We saw a need in the industrial engine marketplace tar more advanced, cost-effective, flexible, easy-to-install and easy-to-use engine control systems. Development of our rich-burn (MEC-R) and lean-burn (MEC-L) air-fuel control systems was a team effort to meet that need.

"Backed by our parent companies' distribution networks, Compliance Controls will focus exclusively on delivering and supporting air-fuel ratio control solutions tailored to our customers' specific requirements," he said.
Both control systems are designed for use on carbureted, spark-ignited natural gas and LPG engines. MEC-R is a rich-burn engine control system for use on engines equipped with three-way catalysts to reduce regulated pollutants such as oxides of nitrogen, carbon monoxide and hydrocarbons.

"The controller minimizes fuel consumption while maximizing catalyst performance for precise, continuous compliance. It also cuts engine maintenance and includes a fail-safe diagnostic and troubleshooting system for operators and management," said Bill Clary, vice president of sales and marketing for Miratech.

MEC-L is a lean-burn engine control system that can control fuel with a variety of valves in full-authority arrangements. "It reduces lean-burn engine maintenance costs, enhances performance and improves fuel economy," said Clary. "MEC-R and MEC-L air-fuel ratio control systems are the result of experience gained over the past decade and offer customers a dramatic upgrade in capabilities and user-friendliness at a competitive price," he added.

Jack Maley, vice president of operations for FWMurphy, pointed out that the MEC systems are closer in design to automotive-type air-fuel controllers than earlier engine control systems. "Using a reliable, high-performance air-fuel controller in conjunction with a three-way catalyst is the most effective method of cleaning rich-burn spark-ignition engine exhaust gases available today," he said.

The three-way catalytic converter that simultaneously oxidizes excess levels of exhaust carbon monoxide (CO) and nonmethane hydrocarbons (NMHC) and reduces nitric oxides (N[O.sub.x]) becomes ineffective if the rich-burn engine air fuel ratio differs by more than 1% from the stoichiometric value. The MEC-R system maximizes the efficiency of a three-way catalyst by maintaining a constant air-fuel ratio and continuous emissions compliance over yawing engine loads, speeds, fuel quality, ambient temperatures and barometric pressures. It fits virtually any gas-fueled, carbureted, rich-burn industrial engine with any catalytic converter.

The MEC-R control scheme includes pre-catalyst closed loop, exhaust oxygen ([O.sub.2]) feedback control, post-catalyst exhaust [O.sub.2] feedback; cascade control for fast, real-time adaptation to changing catalyst performance; variable set-point for pre-catalyst and post catalyst exhaust [O.sub.2] control for fast, real-time response to varying engine loads; catalyst temperature monitoring to protect emissions control catalysts from engine and fueling malfunctions; and two-dimensional open loop valve positioning, based on engine speed and load. It drives up to two fuel-metering valves for V engine configurations and can maintain compliance even with critical oxygen sensor malfunction.

Compliance Controls indicated that a crew of two could install and program the MEC-R system on an engine in two days for a new field installation with hard conduit, or less than a day with one technician for a retrofit project.

In addition to fuel control valve(s) and a microprocessor controller in a NEMA 12 enclosure, the system includes [O.sub.2] sensors downstream of the catalyst and in each exhaust bank upstream of the catalyst, air manifold pressure and temperature RTU's, pre- and post-catalyst temperature probes and a dedicated magnetic pickup for sensing engine rpm from the flywheel. The system includes all connectors and a selection of cables that can be cut to length at the terminal end where they connect to a terminal block inside the controller enclosure. A 9 to 30 Vdc power supply is required. The company and many of its distributors provide installation, set-up and operator training.

Freightliner chassis for new diesel RV line - recreational vehicle

Damon Corp., an Elkhart, Ind.-based manufacturer of recreational vehicles, has introduced a new line of Class A diesel-powered pusher motorhomes. The Ultrasport product line, consisting of the models 3590, 3611 and 3670, are constructed on Freightliner Custom Chassis Corp. chassis which feature a wheelbase of 228 in. and a gvwr of 26,350 lb. on the 1998 models.

All three models of the Ultrasport series are powered by 7.2 L, turbocharged Caterpillar 3126 diesel engines rated 275 hp at 2200 rpm with 800 lb.ft. of torque at 1300 rpm. The engine package includes Farr air filters and Nelson exhaust systems, Delco Remy America 160 amp alternators and 28MT 12 V starters and two maintenance-free batteries rated 950 CCA at 0 degrees F. Other accessories include Fleetguard fuel filter/water separators, Phillips Temro 1000 watt, engine block heaters and Engineered Products air filter restriction indicators.

The engine cooling system incorporates a belt driven fan pulling air through a three -row, 13 FPI, 910 sq.in., rear-mounted, cross-flow radiator from Valeo, which also supplies the cross-flow charge-air cooler.The engine is mated to an Allison MD3060, six-speed automatic transmission with reverse gear and a lockup torque converter. A push-button shift control system with integral ECU is used to control gear selection. The Caterpillar Soft Cruise electronic cruise control with high idle setting is also included.

The front axle is a Rockwell FC-921 I-beam wide track unit with a rated capacity of 10,500 lb. and a 81.9 in. track. The rear axle is a Rockwell RS-15-120 unit rated 15,500 lb. with a 69.3 in. track. The axles are suspended by a Neway air suspension system front and rear, with Bilstein dampers and a 1.50 in. diameter heavy-duty stabilizer bar mounted on the front suspension.

The power steering system is a TRW TAS 65 unit with integral hydraulic power gear, powered by a Vickers gear-driven pump. Steering ratio is 20.4:1 with a maximum steering cramp angle of 50.

The service brakes, full air Rockwell units, feature automatic slack adjusters. The front units are 15 x 4 in. while the rear drum units feature an S-cam and measure 15 x 6 in. The push-pull lever controlled automatic park brake is a spring-applied air release unit which activates the rear brake. A 13.2 cfm air compressor unit is included which employs a Midland Pure Air Plus heated air dryer.

Driver controls are complimented by a Freightliner-supplied instrumentation cluster. The cluster, packaged for Freightliner by ATI, uses Teleflex gauge components and includes: speedometer with odometer; tachometer; engine oil pressure; water temperature; voltmeter; fuel gauge and dual air pressure gauges.

The Ultrasport line frames use a straight rail construction with a maximum frame section of 9.0 in. x 2.75 in. x 0.25 in., which yields a maximum resistance at the bending moment of 291,000 lb.in. Mounted within the frame is a 90 gal. fuel tank, designed to give each vehicle a long travel range.

Auxiliary features include a 50 amp, 12 V power service, 45 amp, 12 V power converter and an Onan 6.5 LP generator set with an auto changeover feature.

All three models include a full kitchen, bathroom/shower facilities and underfloor storage areas accessible from the outside via lockable doors. The model 3670 also includes the Super Slide-Out Section, a free-standing couch and dinette, as well as an optional washer/dryer unit.

For more information on the Ultrasport motorhomes, contact: Damon Corp., P.O. Box 1 107, Elkhart, IN 46515. Telephone: (800) 860-5658.

On-site nitrogen generator unit designed to cut drilling costs - Charge-Air Compression Systems' new product - Product Announcement

Charge-Air Compression Systems, the Calgary, Alberta, Canada, manufacturer of stationary and skid-mounted rotary screw compressors, nitrogen generation units and booster compressors for a variety of industrial applications, has developed a new nitrogen-generating system for use in oil drilling applications. The system is based on existing nitrogen-generating technology and is designed to reduce operating costs in drilling operations using the underbalance drilling method.

Underbalance drilling is used in combination with horizontal and multidirectional drilling. It involves the injection of low-density drilling fluid mixed with nitrogen into the underground field, immediately inducing oil flow to the surface. This method differs from the traditional overbalance drilling method, in which densified fluids are pumped into the downhole until the pressure gradually exceeds that of the formation, thus coaxing the oil to the surface.

"With underbalance drilling, you are in effect creating a free-flow well because you are in production while you are drilling," said Chuck Curtis, general manager of Charge-Air Compression Systems.Benefits of underbalance drilling include increased production from marginal wells and reduced contamination of the hydrocarbon field from drilling tailings and cuttings. Because nitrogen is inert, it does not cause downhole fires and is easily separated from the hydrocarbons.

Six years ago, only about a dozen western Canadian wells were drilled using this method, according to Charge-Air Systems. Last year, it was employed on 500 of the approximately 2000 horizontal or multidirectional wells drilled, the company said.

The primary drawback to this drilling method is the need for nitrogen to be present at the well site. Some sites are in remote locations, requiring nitrogen to be transported to the well site. "On top of the transport costs, you also have the problem that liquid nitrogen vents from delivery trucks at the rate of 5 to 15 percent per day," said Curtis. "At some sites, you will have lost a big part of what you paid to have delivered before it gets there."

To combat this problem, Charge-Air Compression Systems developed its portable nitrogen-generating and compression system, which allows the nitrogen to be produced at the well site. "This isn't new and in fact it has probably been around for about 20 years," said Curtis. "Food plants, gas plants and oil refineries all generate nitrogen at their sites. The trick for us was to improve on existing technology and get to the market with a compact, fully mobile package encompassing on-site generation and delivery to the well head."

Charge-Air solved a big part of the equation by sourcing a portable nitrogen generating unit from Praxair. The nitrogen generator takes air from the primary air compressor package, uses it to create gaseous nitrogen, which is then delivered to the well by an engine-powered booster compressor.

The primary compressor package weighs 20,000 lb., is skid-mounted and fits into a container. The skid is 19 ft. long x 7.6 ft. wide x 7.6 ft. high and can be enclosed for use in cold weather applications.

The air compressor is driven by an eight-cylinder, turbocharged and aftercooled Caterpillar 3408E diesel engine rated 625 hp at 2000 rpm. Use of the electronically controlled 3480E engine offers the added benefits of data acquisition, increased fuel efficiency, and reduced emissions, the company said. The engine package, supplied by Finning Power Systems, Calgary, Alberta, Canada, includes a Donaldson air filter, Silex muffler and L&M Mesabi radiator. A Rockford Powertrain fan clutch, which actuates the belt-driven fan, is also included in the cooling system.

The engine drives an oil-flooded rotary screw air compressor through a Falk trunnion-mounted flexible shaft coupling. Rated flow is 1750 cfm at 200 psi discharge pressure. The compressor has a control system that provides zero to 100 percent stepless modulation. Compressor lubricating oil is circulated via air pressure from the compressor itself, thus eliminating the need for a separate oil pump.

Once the air leaves the compressor it is filtered and cooled by a Thermal Transfer aftercooler/radiator. Air is drawn over this cooler by a hydraulic cooling fan drive system powered by a Sauer-Sundstrand pump, which is driven off a h