Clugston Chris: Scarcity: Humanity's Last Chapter (pg.31-55)

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Global NNR Scarcity Definition An NNR is considered “scarce” globally in the event that globally available NNR supply (the 5 global extraction/production level ) between the years 2000 and 2008 was insufficient to prevent 6 an inflation adjusted NNR price level increase during the 2000-2008 period.

(See Appendix B for 2000 and 2008 global extraction/production levels, 2000 and 2008 price levels, and 2000-2008 percentage changes in the extraction/production levels and price levels associated with each of the 89 analyzed NNRs.) Specifically: If the annual global NNR supply level increased between 2000 and 2008, and: •

•

The NNR price level increased between 2000 and 2008 as well, the NNR was considered “scarce”—supply constrained—in 2008 because global NNR supplies, while increasing between 2000 and 2008, remained insufficient to prevent a price level increase during the period.

The NNR price level decreased or remained unchanged between 2000 and 2008, the NNR was considered “not scarce” because increasing global NNR supplies were sufficient to prevent a price level increase during the period.

If the annual global NNR supply level decreased between 2000 and 2008, and: •

•

The NNR price level increased between 2000 and 2008, the NNR was considered “scarce”— severely supply constrained—in 2008 because global NNR supplies could not be increased during the period, much less increased sufficiently to prevent a price level increase.

The NNR price level decreased between 2000 and 2008, the NNR was considered “not scarce” in 2008 because global NNR supplies, while decreasing between 2000 and 2008, remained sufficient to prevent a price level increase during the period.

An NNR is considered “permanently scarce” globally in the event that globally available, economically viable NNR supplies will never be sufficient going forward to prevent a persistent increase in the NNR price level in the event that the global economic output (GDP) level and growth rate recover to pre-recession levels.

Domestic (US) NNR Scarcity Analysis The following table summarizes domestic (US) criticality and scarcity associated with each of the 89 analyzed NNRs; salient findings include: •

• •

•

An overwhelming majority, 68 of the 89 analyzed NNRs, were considered “scarce” domestically (US) in 2008, immediately prior to the Great Recession; most (58) are almost certain to remain scarce permanently; (See Appendix C for Permanent US NNR Scarcity Definitions.)

The US imported some quantity of 69 of the 89 analyzed NNRs in 2008; imports associated with 19 of the NNRs accounted for 100% of 2008 US supply; Annual domestic (US) extraction/production levels associated with a sizeable majority, 61 of the 89 analyzed NNRs, have almost certainly peaked permanently; (See Appendix C for Permanent US Peak NNR Extraction/Production Level Definitions.) and Annual domestic (US) utilization levels associated with a majority, 50 of the 89 analyzed NNRs, have likely peaked permanently. (See Appendix C for Permanent US Peak NNR Utilization Level Definitions.)

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Critical Declining Indispensible Critical Critical Important Important Indispensible Critical Critical Critical Important Important Indispensible Important Indispensible Indispensible Indispensible Indispensible Indispensible Important Important Important Critical Critical Important Important Critical Important Critical Indispensible

Abrasives (Manufactured) Abrasives (Natural) Aluminum Antimony Arsenic Asbestos Barite Bauxite Beryllium Bismuth Boron Bromine Cadmium Cement Cesium Chromium Clays Coal Cobalt Copper Diamond (Industrial) Diatomite Feldspar Fluorspar Gallium Garnet Gemstones Germanium Gold Graphite (Natural) Gypsum

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NNR Criticality

Nonrenewable Natural Resource (NNR)

2008 Domestic (US) NNR Scarcity Summary

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Yes No Yes Yes Yes Yes Yes Yes Yes Yes No Yes No Yes Yes Yes No No Yes Yes Yes No Yes Yes Yes Yes Yes Yes No Yes Yes

Almost Certain Unlikely Almost Certain Almost Certain Almost Certain Unclear Almost Certain Almost Certain Unclear Almost Certain Unclear Likely Unclear Unclear Almost Certain Almost Certain Unlikely Unclear Almost Certain Almost Certain Almost Certain Unlikely Almost Certain Almost Certain Almost Certain Almost Certain Almost Certain Almost Certain Unclear Almost Certain Almost Certain

Domestic (US) Scarcity In 2008 Permanent

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76% 0% 24% 93% 100% 100% 80% 100% 17% 94% 0% 12% 0% 11% 100% 66% 0% 0% 81% 31% 91% 0% 32% 100% 99% 37% 99% 90% 0% 100% 24%

1974 2008 1980 1948 1944 1973 1981 1943 1980 -01995 1997 1969 2005 -01956 1973 2008 1958 1998 2008 2006 1997 1944 1978 1998 1991 1981 1998 1907 2006

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Almost Certain Unclear Almost Certain Almost Certain Almost Certain Almost Certain Almost Certain Almost Certain Almost Certain Almost Certain Unclear Almost Certain Likely Unclear Almost Certain Almost Certain Unclear Unlikely Almost Certain Almost Certain Unclear Unlikely Almost Certain Almost Certain Almost Certain Almost Certain Almost Certain Almost Certain Likely Almost Certain Unclear

US Extraction/ Production Peak Year Permanent

US NNR Limits 2008 US Import Percent 1974 1979 1999 1997 1942 1973 1981 1974 1999 2007 1978 2005 1969 2005 1984 1965 1973 2007 2005 1999 2008 2006 1997 1973 2000 2007 2007 2007 1998 1978 2006

Likely Likely Likely Likely Likely Likely Likely Likely Likely Unlikely Likely Unlikely Likely Unlikely Inconclusive Likely Likely Unlikely Unlikely Likely Unlikely Unlikely Likely Likely Unclear Unlikely Unlikely Unlikely Likely Likely Unlikely

US Utilization Peak Year Permanent

Important Important Critical Critical Indispensible Indispensible Important Critical Critical Critical Critical Indispensible Indispensible Declining Important Declining Critical Indispensible Critical Critical Indispensible Indispensible Declining Important Indispensible Indispensible Indispensible Important Critical Indispensible Critical Important Critical Indispensible

Hafnium Helium Indium Iodine Iron Ore Iron/Steel Kyanite Lead Lime Lithium Magnesium Compounds Magnesium Metal Manganese Mercury Mica (Scrap and Flake) Mica (Sheet) Molybdenum Natural Gas Nickel Niobium Nitrogen (Ammonia) Oil Peat Perlite Phosphate Rock Platinum Group Metals (PGM) Potash Pumice Quartz Crystal Rare Earth Minerals (REM) Rhenium Rubidium Salt Sand & Gravel (Construction)

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NNR Criticality

Nonrenewable Natural Resource (NNR)

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Yes No Yes Yes No Yes No Yes No Yes Yes Yes Yes No Yes Yes No Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes No

Unclear Unlikely Almost Certain Almost Certain Unclear Likely Unlikely Almost Certain Unlikely Almost Certain Almost Certain Almost Certain Almost Certain Unclear Almost Certain Almost Certain Unclear Likely Almost Certain Almost Certain Almost Certain Almost Certain Almost Certain Almost Certain Likely Almost Certain Almost Certain Unclear Almost Certain Almost Certain Almost Certain Almost Certain Likely Unlikely

Domestic (US) Scarcity In 2008 Permanent

2008 Domestic (US) NNR Scarcity Summary (continued)

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8% 0% 100% 72% 0% 13% 0% 16% 1% >50% 54% 50% 100% 0% 18% 100% 0% 13% 34% 100% 42% 57% 57% 26% 4% 89% 84% 6% 100% 100% 85% 100% 21% 0%

1983 1967 1966 1992 1953 1973 2007 1970 2006 1954 1966 1943 1918 1943 1984 1943 1980 1973 1997 -01980 1970 1987 1999 1980 2002 1967 2006 1984 1984 1991 ?

2008 2006

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Almost Certain Unclear Almost Certain Almost Certain Likely Almost Certain Unlikely Almost Certain Unlikely Almost Certain Almost Certain Almost Certain Almost Certain Likely Almost Certain Almost Certain Unclear Unclear Almost Certain Almost Certain Almost Certain Almost Certain Almost Certain Almost Certain Almost Certain Unclear Almost Certain Unlikely Almost Certain Almost Certain Almost Certain Almost Certain Unclear Unlikely

US Extraction/ Production Peak Year Permanent

US NNR Limits 2008 US Import Percent 2003 Unclear 2000 Unclear 2008 Unlikely 2002 Unclear 1954 Likely 1973 Likely 2008 Unlikely 1999 Likely 2006 Unlikely 1974 Likely 1966 Likely 1997 Likely 1973 Likely 1964 Likely 2006 Unlikely 1950 Likely 2006 Unlikely 2008 Unlikely 1974 Likely 2006 Unlikely 1998 Likely 2005 Unclear 2005 Unlikely 2000 Unclear 1998 Likely 2008 Unlikely 1979 Likely 2004 Unclear 1943 Likely 1990 Likely 2008 Unlikely Inconclusive 2008 Unlikely 2006 Unlikely

US Utilization Peak Year Permanent

Indispensible Important Indispensible Critical Important Important Indispensible Important Important Indispensible Declining Critical Critical Important Declining Critical Indispensible Indispensible Critical Critical Critical Declining Indispensible Critical

Sand & Gravel (Industrial) Selenium Silicon Silver Soda Ash Sodium Sulfate Stone (Crushed) Stone (Dimension) Strontium Sulfur Talc Tantalum Tellurium Thallium Thorium Tin Titanium Mineral Con. Titanium Metal Tungsten Uranium Vanadium Vermiculite Zinc Zirconium

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NNR Criticality

Nonrenewable Natural Resource (NNR)

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No No Yes Yes No No No Yes Yes Yes No Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes No

Unlikely Unclear Almost Certain Almost Certain Unlikely Unclear Unlikely Almost Certain Almost Certain Almost Certain Unclear Almost Certain Almost Certain Almost Certain Almost Certain Almost Certain Almost Certain Almost Certain Almost Certain Almost Certain Almost Certain Almost Certain Almost Certain Unclear

Domestic (US) Scarcity In 2008 Permanent

2008 Domestic (US) NNR Scarcity Summary (continued)

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0% 0% 52% 67% 0% 0% 1% 87% 100% 25% 0% 100% 40% 100% 100% 80% 78% 71% 60% 65% 100% 40% 71% 0%

2005 1969 1979 1916 2008 1968 2006 1931 1943 1981 1979 -01960 1977 1961 1945 1964 1989 1955 1981 1981 1973 1969 1989

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Unlikely Likely Almost Certain Almost Certain Unlikely Likely Unlikely Almost Certain Almost Certain Almost Certain Likely Almost Certain Almost Certain Almost Certain Almost Certain Almost Certain Almost Certain Almost Certain Almost Certain Almost Certain Almost Certain Almost Certain Almost Certain Likely

US Extraction/ Production Peak Year Permanent

US NNR Limits 2008 US Import Percent 1979 1969 2000 2003 1990 1973 2006 2007 1999 1995 1990 1974 1979 1970 1972 1950 1997 2007 1954 1960 2005 1973 1999 1988

Likely Likely Unclear Unclear Likely Likely Unlikely Unlikely Likely Likely Likely Likely Inconclusive Likely Likely Likely Likely Unlikely Likely Likely Unclear Likely Likely Likely

US Utilization Peak Year Permanent

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Domestic (US) NNR Scarcity 2008 Domestic (US) NNR Scarcity Summary

Domestic (US) NNR Scarcity Indispensible

NNR Criticality Critical Important

Totals Declining

2008 US NNR Scarcity Scarce Not Scarce (Sufficient) Inconclusive Totals

22 6 0 28

26 4 0 30

16 8 0 24

4 3 0 7

68 21 0 89

Permanent US NNR Scarcity Almost Certain Likely Unclear Unlikely Inconclusive Totals

18 3 3 4 0 28

24 1 4 1 0 30

12 1 7 4 0 24

4 0 2 1 0 7

58 5 16 10 0 89

68 of the 89 analyzed NNRs were “scarce” domestically (US) in 2008—i.e., domestically available, economically viable NNR supplies were insufficient to fully address domestic demand (requirements). The US was therefore reliant to some extent on (net) foreign NNR imports in 2008.

Of the 68 domestically scarce NNRs: • •

22 NNRs—including aluminum, copper, iron/steel, natural gas, oil, phosphate rock, potash, rare earth minerals, titanium, and zinc—are indispensible to modern industrial existence; and 26 NNRs—including gallium, graphite, indium, lithium, niobium, tin, uranium, and vanadium— are critical to modern industrial existence.

21 of the 89 analyzed NNRs were “not scarce” domestically (US) in 2008—domestically available, economically viable NNR supplies were sufficient to fully address domestic demand; the US was not reliant on net foreign NNR imports in 2008.

Of the 21 domestically sufficient NNRs: • •

6 NNRs—including clays, coal, iron ore, sand and gravel, and crushed stone—are indispensible to modern industrial existence; and 4 NNRs—including boron, lime, and molybdenum—are critical to modern industrial existence.

Domestically available, economically viable supplies associated with 63 of the 89 analyzed NNRs are either “almost certain” or “likely” to remain scarce permanently going forward: •

•

58 NNRs—including aluminum, copper, lithium, oil, potash, rare earth minerals, tin, titanium, uranium, and zinc—are “almost certain” to remain scarce permanently in the US, especially in the event that the US economy recovers completely from the Great Recession; and 5 NNRs—including iron/steel, natural gas, and phosphate rock—are “likely” to remain scarce permanently in the US, especially in the event that the US economy recovers completely from the Great Recession.

Only 10 of the 89 analyzed NNRs—including clays, helium, lime, sand and gravel, soda ash, and crushed stone—are “unlikely” to become permanently scarce domestically (US) in the immediate future.

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Domestic (US) NNR Import Reliance th

st

US NNR import reliance increased steadily during the 20 century and into the 21 century. By 2008, the US imported some amount of 69 NNRs, and imported 100% of 19 NNRs. 2008 US NNR Import Reliance US Import Percentage NNR # 1%-20%

10

21%-40%

11

41%-60%

9

61%-80%

7

81%-99%

11

100%

19

N/A (Insufficient USGS data)* Total Imported NNRs

2 69

NNRs Imported by the US Beryllium, Cement, Iron/Steel, Lead, Lime, Mica (sheet), Natural Gas, Phosphate Rock, Pumice, Stone (crushed) Aluminum, Bromine, Copper, Feldspar, Garnet, Gypsum, Nickel, Perlite, Salt, Sulfur, Vermiculite Lithium, Magnesium Compounds, Magnesium Metal, Nitrogen (ammonia), Oil, Peat, Silicon, Titanium Metal, Tungsten Barite, Chromium, Silver, Tin, Titanium Concentrates, Uranium, Zinc Antimony, Bismuth, Cobalt, Diamond, Gallium, Gemstones, Germanium, Platinum Group Metals, Potash, Rhenium, Stone (dimension) Arsenic, Asbestos, Bauxite, Cesium, Fluorspar, Graphite, Indium, Manganese, Mica (sheet), Niobium, Quartz Crystal, Rare Earth Minerals, Rubidium, Strontium, Tantalum, Tellurium, Thallium, Thorium, Vanadium Hafnium, Selenium

*The US produced no Hafnium or Selenium in 2008; some quantities of each must have been imported.

Indispensible to modern industrial existence Peak Domestic (US) NNR Extraction/Production 2008 Annual Domestic (US) Peak NNR Extraction/Production Summary US NNR Extraction/Production NNR Criticality Indispensible Critical Important Almost Certainly Peaked Permanently Likely Peaked Permanently Unclear Unlikely Peaked Permanently Inconclusive Totals

18 1 5 4 0 28

25 1 3 1 0 30

14 4 2 4 0 24

Totals Declining 4 2 1 0 0 7

61 8 11 9 0 89

Annual domestic (US) extraction/production levels associated with 69 of the 89 analyzed NNRs have “almost certainly” or “likely” peaked permanently.

•

•

Annual domestic (US) extraction/production levels associated with 61 of the 69 NNRs— including aluminum, chromium, cobalt, copper, iron/steel, magnesium, manganese, oil, phosphate rock, potash, rare earth minerals, titanium, and zinc—have “almost certainly” peaked permanently; and Annual domestic (US) extraction/production levels associated with 8 of the 69 NNRs— including gold, iron ore, selenium, and zirconium—have “likely” peaked permanently.

It is “unlikely” that annual domestic (US) extraction/production levels associated with 9 of the 89 analyzed NNRs—including coal, diatomite, lime, pumice, sand and gravel, soda ash, and crushed stone—have peaked permanently.

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Peak (to date) domestic (US) extraction/production occurred prior to the new millennium in 74 of the 89 analyzed cases; only 15 of the 89 analyzed NNRs had not reached domestic (US) peak (to date) extraction/production levels by the year 2000.

Domestic (US) Peak NNR Extraction/Production Incidence US Peak-to-Date US Peak-to-Date US Peak-to-Date 1900-1950 1951-1975 1976-1999 13 NNRs 28 NNRs 33 NNRs

US Peak-to-Date 2000-2008 15 NNRs

[Note: it is assumed that if domestic (US) economically viable NNR extraction/production levels 7 could be increased beyond current levels, such would be the case. Doing so would: 1. Decrease US foreign NNR dependence by reducing NNR imports and associated trade deficits; and 2. Increase American economic performance (and societal wellbeing) by increasing US NNR exports, US finished goods exports, and associated trade surpluses.]

Peak Domestic (US) NNR Utilization 2008 Annual Domestic (US) Peak NNR Utilization Summary US NNR Utilization NNR Criticality Indispensible Critical Important Likely Peaked Permanently Unclear Unlikely Peaked Permanently Inconclusive Totals

17 2 9 0 28

17 4 8 1 30

10 4 8 2 24

Totals Declining 6 0 1 0 7

50 10 26 3 89

It is “likely” that annual domestic (US) utilization levels associated with 50 of the 89 analyzed NNRs—including aluminum, clays, copper, iron ore, magnesium, manganese, phosphate rock, potash, rare earth minerals, sulfur, and zinc—have peaked permanently.

It is “unlikely” that annual domestic (US) utilization levels associated with 26 of the 89 analyzed NNRs—including coal, cobalt, gypsum, lime, molybdenum, natural gas, platinum group metals, and titanium—have peaked permanently.

Domestic (US) NNR Scarcity Summary Assessment Total US NNR requirements—i.e., the NNR quantities (economic inputs) necessary to perpetuate the American way of life—increasingly exceeded domestically available, economically viable NNR th supplies throughout the latter half of the 20 century.

By 2008, in a sizeable majority of cases, total US NNR requirements permanently exceeded domestically available, economically viable NNR supplies. And in a majority of cases, total US NNR requirements permanently exceeded domestic (US) and imported economically viable NNR supplies combined.

•

68 of the 89 analyzed NNRs were scarce domestically (US) in 2008; 58 of these NNRs are “almost certain” to remain scarce permanently, especially in the event that the US economy recovers completely from the Great Recession. The US will be perennially reliant on foreign suppliers—often few in number, geographically remote, politically unstable, geopolitically adversarial, and/or increasingly unwilling or unable to fulfill American requirements—for these NNRs.

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•

•

Annual domestic (US) extraction/production levels associated with 61 of the 89 analyzed NNRs have “almost certainly” peaked permanently. Going forward, US import reliance associated with these NNRs will increase as domestically available, economically viable supplies decline continuously.

Annual domestic (US) utilization levels associated with 50 of the 89 analyzed NNRs “likely” peaked permanently. For these 50 NNRs, total annual input quantities to the US economy, from domestic (US) and foreign sources combined, are likely in terminal decline.

Going forward, 47 of the 89 analyzed NNRs are considered “at risk” domestically (US). That is, combined domestic (US) and imported economically viable supplies associated with these NNRs and derived goods and services will likely experience increasingly severe shortages, as America attempts to reestablish and maintain its pre-recession economic output (GDP) level and growth rate on a continuous basis.

Domestic (US) “At Risk” NNRs Nonrenewable Natural Resource (NNR)

NNR Criticality

Permanent US NNR Scarcity

Permanent US Peak Extraction/ Production

Permanent US Peak Utilization

Potential Geopolitical Supply Constraints

Critical

Almost Certain

Almost Certain

Likely

Aluminum

Indispensible

Almost Certain

Almost Certain

Likely

Antimony

Critical

Almost Certain

Almost Certain

Likely

Arsenic

Critical

Almost Certain

Almost Certain

Likely

Important

Almost Certain

Almost Certain

Likely

Indispensible

Almost Certain

Almost Certain

Likely

Almost Certain

Likely

83% of US fused aluminum oxide and crude silicon carbide imports come from China.

56% of US aluminum imports come from Canada.

51% of US antimony imports come from China; over 50% of the proven global antimony reserves are located in China and Russia (combined).

86% of US arsenic metal imports and 47% of trioxide imports come from China.

93% of US barite imports come from China.

Over 50% of proven global bauxite reserves are located in Australia and Guinea.

58% of US beryllium imports come from Kazakhstan.

Over two thirds of proven global bismuth reserves are located in China.

Over 75% of proven global chromium reserves are located in South Africa and Kazakhstan (combined).

Over half of the proven global cobalt reserves are located in the Congo.

Abrasives (Manufactured)

Barite

Bauxite

Beryllium

Critical

Bismuth

Critical

Almost Certain

Almost Certain

Chromium

Indispensible

Almost Certain

Almost Certain

Cobalt

Indispensible

Almost Certain

Almost Certain

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Domestic (US) “At Risk” NNRs (continued) Nonrenewable Natural Resource (NNR)

NNR Criticality

Permanent US NNR Scarcity

Permanent US Peak Extraction/ Production

Permanent US Peak Utilization

Potential Geopolitical Supply Constraints

Indispensible

Almost Certain

Almost Certain

Likely

Fluorspar

Critical

Almost Certain

Almost Certain

Likely

Gallium

Critical

Almost Certain

Almost Certain

Germanium

Critical

Almost Certain

Almost Certain

Graphite (Natural)

Critical

Almost Certain

Almost Certain

Indispensible

Almost Certain

Indium

Critical

Almost Certain

Almost Certain

Iodine

Critical

Almost Certain

Almost Certain

Indispensible

Likely

Almost Certain

Likely

Lead

Critical

Almost Certain

Almost Certain

Likely

Lithium

Critical

Almost Certain

Almost Certain

Likely

Magnesium Compounds

Critical

Almost Certain

Almost Certain

Likely

Magnesium Metal

Indispensible

Almost Certain

Almost Certain

Likely

Manganese

Indispensible

Almost Certain

Almost Certain

Likely

Critical

Almost Certain

Almost Certain

Likely

40% of US copper imports come from Chile.

52% of US fluorspar imports come from China.

China, Kazakhstan, and the Ukraine are 3 of the top 4 producers of unrefined gallium.

China produces a majority of the world’s germanium.

47% of US graphite imports come from China; nearly 80% of proven global reserves are located in China.

China is by far the leading producer of gypsum in the world.

40% of US indium imports come from China; half of the proven global indium reserves are located in China.

60% of proven global iodine reserves are located in China.

China accounts for more than half of annual global iron ore extraction.

China accounts for 40% of global lead mine production.

63% of US lithium imports come from Chile; 76% of proven global lithium reserves are located in Chile.

79% of US magnesium compound imports come from China.

40% of US magnesium metal imports come from Canada.

Over 50% of proven global manganese reserves are located in South Africa and the Ukraine (combined).

Nearly 40% of proven global nickel reserves are located in Australia.

Copper

Gypsum

Iron/Steel

Nickel

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Domestic (US) “At Risk” NNRs (continued) Nonrenewable Natural Resource (NNR)

NNR Criticality

Permanent US NNR Scarcity

Permanent US Peak Extraction/ Production

Critical

Almost Certain

Almost Certain

Nitrogen (Ammonia)

Indispensible

Almost Certain

Almost Certain

Likely

Oil

Indispensible

Almost Certain

Almost Certain

????

Phosphate Rock

Indispensible

Likely

Almost Certain

Likely

Platinum Group Metals (PGM)

Indispensible

Almost Certain

Potash

Indispensible

Almost Certain

Almost Certain

Likely

Critical

Almost Certain

Almost Certain

Likely

Indispensible

Almost Certain

Almost Certain

Likely

Critical

Almost Certain

Almost Certain

Silicon

Indispensible

Almost Certain

Almost Certain

Silver

Critical

Almost Certain

Almost Certain

Sulfur

Indispensible

Almost Certain

Almost Certain

Likely

Tantalum

Critical

Almost Certain

Almost Certain

Likely

Tellurium

Critical

Almost Certain

Almost Certain

Thallium

Important

Almost Certain

Almost Certain

Likely

Critical

Almost Certain

Almost Certain

Likely

Niobium

Quartz Crystal

Rare Earth Minerals (REM)

Rhenium

Tin

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Permanent US Peak Utilization

Potential Geopolitical Supply Constraints 85% of US niobium imports come from Brazil; Brazil produces about 75% of the world’s supply of niobium.

55% of US ammonia imports come from Trinidad and Tobago.

Approximately 80% of the world’s proven oil reserves are located in the Middle East.

100% of US phosphate rock imports come from Morocco.

The US produces only 2% of global platinum and 6% of global palladium.

Over 50% of proven global potash reserves are located in Canada.

Most US quartz crystal (cultured) imports come from China, Japan, and Russia.

91% of US REM imports come from China; China accounts for 95% of global REM extraction.

Chile has the largest proven rhenium reserves and is the world’s largest rhenium producer.

China produced 65% of the world’s silicon in 2008.

54% of US silver imports come from Mexico.

71% of US elemental sulfur imports and 77% of US sulfuric acid imports come from Canada.

The vast majority of proven global tantalum reserves are located in Australia (36%) and Brazil (59%).

43% of US tellurium imports come from China.

78% of US thallium imports come from Russia.

47% of US tin imports come from Peru.

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Domestic (US) “At Risk” NNRs (continued) Nonrenewable Natural Resource (NNR)

NNR Criticality

Permanent US NNR Scarcity

Permanent US Peak Extraction/ Production

Permanent US Peak Utilization

Potential Geopolitical Supply Constraints

Titanium Mineral Concentrates

Indispensible

Almost Certain

Almost Certain

Likely

Titanium Metal

Indispensible

Almost Certain

Almost Certain

Tungsten

Critical

Almost Certain

Almost Certain

Likely

Uranium

Critical

Almost Certain

Almost Certain

Likely

Vanadium

Critical

Almost Certain

Almost Certain

Indispensible

Almost Certain

Almost Certain

51% of US titanium mineral concentrate imports come from South Africa.

52% of US titanium sponge metal imports come from Kazakhstan.

43% of US tungsten imports come from China; 64% of proven global reserves are located in China.

Canada, Australia, and Kazakhstan each produce approximately one quarter of the world’s annual uranium supply.

China and South Africa each account for approximately 40% of proven global vanadium reserves.

68% of US zinc ore and concentrate imports come from Peru.

Zinc

Likely

The Great Recession marked a tipping point in US history. The epidemic incidence of permanent domestic (US) NNR supply constraints—permanent NNR scarcity, permanent peak NNR extraction/production levels, and permanent NNR utilization levels—experienced by the onset of the Great Recession, imposed permanent limits on future US economic output (GDP) and societal wellbeing levels.

Global NNR Scarcity Analysis The following table summarizes global criticality and scarcity associated with each of the 89 analyzed NNRs; salient findings include: • •

•

An overwhelming majority, 63 of the 89 analyzed NNRs, were considered “scarce” globally in 2008, immediately prior to the Great Recession; A significant number, 28 of the 89 analyzed NNRs, is almost certain to remain scarce permanently going forward; and a sizeable number, 16 of the 89 analyzed NNRs, is likely to remain scarce permanently; (See Appendix C for Permanent Global NNR Scarcity Definitions.) and Global extraction/production levels associated with a small but significant number, 8 of the 89 analyzed NNRs, have likely peaked permanently. (See Appendix C for Permanent Global Peak NNR Extraction/Production Level Definitions.)

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2008 Global NNR Criticality and Scarcity Summary Nonrenewable Natural Resource (NNR)

NNR Criticality

Abrasives (Manufactured) Abrasives (Natural) Aluminum Antimony Arsenic Asbestos Barite Bauxite Beryllium Bismuth Boron Bromine Cadmium Cement Cesium Chromium Clays Coal Cobalt Copper Diamond (Industrial) Diatomite Feldspar Fluorspar Gallium Garnet Gemstones Germanium Gold Graphite (Natural) Gypsum Hafnium Helium Indium Iodine Iron Ore Iron/Steel Kyanite Lead Lime Lithium Magnesium Compounds Magnesium Metal Manganese Mercury Mica (Scrap and Flake) Mica (Sheet) Molybdenum Natural Gas Nickel Niobium Nitrogen (Ammonia) Oil

Critical Declining Indispensible Critical Critical Important Important Indispensible Critical Critical Critical Important Important Indispensible Important Indispensible Indispensible Indispensible Indispensible Indispensible Important Important Important Critical Critical Important Important Critical Important Critical Indispensible Important Important Critical Critical Indispensible Indispensible Important Critical Critical Critical Critical Indispensible Indispensible Declining Important Declining Critical Indispensible Critical Critical Indispensible Indispensible

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Global NNR Limits Global Scarcity Global Extraction/ Production Peak In 2008 Permanent Year Permanent No No Yes Yes No Yes Yes No Yes Yes No Yes Yes Yes No Yes Yes Yes Yes Yes No No No Yes No No No No Yes Yes Yes Yes No Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes No Yes Yes Yes Yes Yes Yes

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Unclear Unlikely Unclear Almost Certain Unclear Unclear Almost Certain Likely Likely Almost Certain Unclear Unclear Likely Unclear Unclear Almost Certain Unclear Almost Certain Almost Certain Almost Certain Unclear Unlikely Unclear Likely Unclear Unclear Unlikely Unclear Almost Certain Likely Likely Unclear Unlikely Almost Certain Unclear Almost Certain Almost Certain Unclear Almost Certain Unclear Likely Unclear Likely Almost Certain Unclear Unclear Unclear Almost Certain Almost Certain Likely Almost Certain Almost Certain Almost Certain

1974 2008 2008 2003 1977 1981 2008 1961 2008 2004 2006 1988 2008 1982 2008 2008 2008 2008 2007 2008 2008 2008 2008 2006 2006 2008 2001 2008 2007 1963 2008 2006 2006 2008 2007 2008 2008 2008 2006 2008 2007 2008 1971 2005 1975 2008 2008 2007 2008 2008 2005

Inconclusive Unclear Unlikely Unlikely Unlikely Unclear Unlikely Unlikely Likely Unlikely Unlikely Unlikely Unlikely Unlikely Likely Unlikely Inconclusive Unlikely Unlikely Unlikely Unlikely Unlikely Unlikely Unlikely Unlikely Unlikely Unlikely Unlikely Likely Unlikely Unlikely Unlikely Unlikely Unlikely Unlikely Unlikely Unlikely Unlikely Unlikely Unlikely Unlikely Unlikely Unlikely Unlikely Unlikely Unclear Unlikely Unlikely Unlikely Unlikely Unlikely Unlikely Unclear

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2008 Global NNR Criticality and Scarcity Summary (continued) Global NNR Limits Nonrenewable Natural NNR Global Scarcity Global Extraction/ Resource (NNR) Criticality Production Peak In 2008 Permanent Year Permanent Peat Perlite Phosphate Rock Platinum Group Metals (PGM) Potash Pumice Quartz Crystal Rare Earth Minerals (REM) Rhenium Rubidium Salt Sand & Gravel (Construction) Sand & Gravel (Industrial) Selenium Silicon Silver Soda Ash Sodium Sulfate Stone (Crushed) Stone (Dimension) Strontium Sulfur Talc Tantalum Tellurium Thallium Thorium Tin Titanium Mineral Con. Titanium Metal Tungsten Uranium Vanadium Vermiculite Zinc Zirconium

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Declining Important Indispensible Indispensible Indispensible Important Critical Indispensible Critical Important Critical Indispensible Indispensible Important Indispensible Critical Important Important Indispensible Important Important Indispensible Declining Critical Critical Important Declining Critical Indispensible Indispensible Critical Critical Critical Declining Indispensible Critical

No Yes Yes No Yes No Yes Yes Yes Yes Yes Yes Yes Yes Yes No Yes No Yes Yes No No No Yes Yes Yes Yes Yes Yes Yes Yes No Yes Yes

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Unlikely Unclear Almost Certain Unclear Likely Unlikely Inconclusive Unclear Almost Certain Inconclusive Unclear Unclear Likely Almost Certain Likely Almost Certain Unclear Unlikely Unclear Unlikely Likely Almost Certain Unclear Unlikely Unclear Almost Certain Unclear Almost Certain Likely Unclear Almost Certain Almost Certain Likely Unlikely Likely Almost Certain

1984 1999 1988 2006 2007 2007 1966 2006 2008 2006 2007 1996 2008 2008 2008 2008

2004 2008 1997 2004 1974 1989 1972 2007 2007 2004 1982 2007 1987 2008 2007

Unlikely Likely Unclear Unlikely Unlikely Unlikely Likely Unlikely Unlikely Inconclusive Unlikely Inconclusive Unlikely Likely Unlikely Unlikely Unlikely Unlikely Inconclusive Inconclusive Unclear Unlikely Unlikely Unlikely Likely Likely Inconclusive Unlikely Unlikely Inconclusive Unclear Inconclusive Unlikely Unlikely Unlikely Unlikely

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Global NNR Scarcity 2008 Global NNR Scarcity Summary NNR Criticality Critical Important

Global NNR Scarcity Indispensible

Totals Declining

2008 Global NNR Scarcity Scarce Not Scarce (Sufficient) Inconclusive Totals

26 2 0 28

22 7 1 30

13 10 1 24

2 5 0 7

63 24 2 89

Permanent Global NNR Scarcity Almost Certain Likely Unclear Unlikely Inconclusive Totals

12 8 8 0 0 28

12 6 10 1 1 30

4 2 11 6 1 24

0 0 4 3 0 7

28 16 33 10 2 89

63 of the 89 analyzed NNRs were “scarce” globally in 2008—i.e., the (inflation adjusted) price levels associated with these NNRs increased between 2000 and 2008.

In some cases, the 2000-2008 price level increases were significant (50%-100%): 2000-2008 Price Increases for Globally Scarce NNRs Coal: 52% Cobalt: 84% Magnesium: 99% Nickel: 96%

2000-2008 Price Increases for Globally Scarce NNRs Rare Earth Minerals: 58% Rhenium: 86% Silicon: 59% Zirconium: 68%

In other cases, the 2000-2008 price level increases were extraordinary (100%+): 2000-2008 Price Increases for Globally Scarce NNRs Antimony: 243% Bismuth: 175% Chromium: 266% Copper: 190% Gypsum: 115% Indium: 192% Iron Ore: 132% Iron and Steel: 105%

2000-2008 Price Increases for Globally Scarce NNRs Lead: 121% Manganese: 227% Molybdenum: 795% Natural Gas: 156% Nitrogen (ammonia): 179% Oil: 244% Phosphate Rock: 145% Potash: 230%

2000-2008 Price Increases for Globally Scarce NNRs Selenium: 572% Silver: 146% Sulfur: 750% Thallium: 202% Tin: 145% Tungsten: 239% Uranium: 215% Vanadium: 547%

Of the 63 NNRs that were scarce globally in 2008: •

•

26 NNRs—including aluminum, chromium, coal, cobalt, copper, gypsum, iron ore, natural gas, nitrogen (ammonia), oil, phosphate rock, potash, rare earth minerals, silicon, and zinc— are indispensible to modern industrial existence; and 22 NNRs—including antimony, bismuth, indium, lead, lithium, molybdenum, nickel, niobium, rhenium, tin, tungsten, uranium, and vanadium—are critical to modern industrial existence.

24 of the 89 analyzed NNRs were “not scarce” globally in 2008—i.e., globally available, economically viable supplies were sufficient between 2000 and 2008 to prevent price level increases during the period.

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Of the 24 globally sufficient NNRs: • •

2 NNRs—bauxite and platinum group metals (PGM)—are indispensible to modern industrial existence; and 7 NNRs—including boron, gallium, germanium, tantalum, and tellurium—are critical to modern industrial existence.

Globally available, economically viable supplies associated with 44 of the 89 analyzed NNRs are either “almost certain” or “likely” to remain scarce permanently going forward: •

•

28 NNRs—including chromium, coal, cobalt, copper, gypsum, iron, ore, manganese, natural gas, oil, phosphate rock, tin, and uranium—are “almost certain” to remain scarce permanently in the event that the global economy recovers completely from the Great Recession; and 16 NNRs—including fluorspar, graphite, lithium, magnesium, nickel, potash, vanadium, and zinc—are “likely” to remain scarce permanently in the event that the global economy recovers completely from the Great Recession.

Globally available, economically viable supplies associated with 10 of the 89 analyzed NNRs— including diatomite, helium, peat, pumice, sodium sulfate, tantalum, and vermiculite—are “unlikely” to become permanently scarce globally in the immediate future.

Peak Global NNR Extraction/Production Pre-recession Global Peak NNR Extraction/Production Overview 2008 Annual Global Peak NNR Extraction/Production Summary Global NNR Extraction/Production NNR Criticality Indispensible Critical Important Almost Certainly Peaked Permanently Likely Peaked Permanently Unclear Unlikely Peaked Permanently Inconclusive Totals

0 0 2 22 4 28

0 3 1 24 2 30

0 5 3 14 2 24

Totals Declining 0 0 2 4 1 7

0 8 8 64 9 89

Annual global extraction/production levels associated with 18 of the 89 analyzed NNRs peaked (to date) prior to 2000. Annual extraction/production levels associated with 8 of the 18 NNRs— beryllium, cesium, gold, perlite, quartz crystal, selenium, tellurium, and thallium—have “likely” peaked permanently on the global level. Beryllium, quartz crystal, and tellurium are critical to modern industrial existence.

Increasing Global NNR Scarcity The following three indicators of increasing global NNR scarcity underscore the challenges facing industrialized and industrializing nations as they attempt to reestablish and exceed pre-recession economic output (GDP) levels and growth rates going forward.

Required Global NNR Extraction/Production Growth Rates A “doubling time” is the number of years within which annual NNR extraction or production will double assuming a specified compound annual growth rate (CAGR) in extraction/production, in this case the CAGR that existed prior to the Great Recession.

Following are the pre-recession CAGRs and approximate doubling times associated with 22 indispensible and critical NNRs.

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Pre-recession NNR CAGRs and Corresponding NNR Extraction/Production Level Doubling Times

Antimony Bauxite Beryllium

2000-2008 CAGR 6.6% 6.3% 6.5%

NNR Extraction/ Production Level Doubling Time 11 Years 13.5 Years 11 Years

Bismuth

9.4%

7.5 Years

Cement Chromium Coal Cobalt Fluorspar

6.8% 4.9% 5.1% 8.6% 4.3%

11 Years 14.5 Years 14 Years 8.5 Years 16.5 Years

Germanium

9.1%

8 Years

Gypsum Indium Iron Ore Lithium

5.0% 6.9% 9.4% 8.2%

14 Years 10.5 Years 7.5 Years 9 Years

Magnesium

6.0%

12 Years

Manganese Molybdenum

5.1% 6.2%

9 Years 11.5 Years

Niobium

12.3%

6 Years

REMs

5.0%

14 Years

Rhenium Silicon

5.9% 7.3%

12 Years 10 Years

Uranium Zirconium

4.3% 7.3%

16.5 Years 10 Years

NNR

Critical NNR Applications Starter-lights-ignition batteries used in cars and trucks The only economically viable feedstock for aluminum Satellites, military aircraft, nuclear power generation equipment Nontoxic substitute for lead in solder and plumbing fixtures Ubiquitous building material Stainless steel, jet engines, and gas turbines Largest source of electricity generation in the world Gas turbine blades, jet aircraft engines, batteries Feedstock for fluorine bearing chemicals, aluminum and uranium processing Fiber optics, thermal imaging, wireless communications Wallboard, plaster, cement LCDs, touchscreens, thin film solar cells The only feedstock for iron and steel Aircraft parts, mobile phones, batteries for electric vehicles Aerospace equipment, electronic devices, beverage cans Stainless steel, gasoline additive, dry cell batteries Aircraft parts, electrical contacts, industrial motors, tool steels Jet and rocket engines, turbines, superconducting magnets Permanent magnets, electric vehicle batteries, superconductors Petroleum refining, jet engines, gas turbine blades Primary component of glass, concrete, and semiconductors Primary energy source, weapons Nuclear power plants, jet engines, gas turbine blades

In order to reestablish and maintain pre-recession extraction/production CAGRs, coal extraction must double every 14 years, cobalt extraction must double every 8.5 years, iron ore extraction must double every 7.5 years, manganese extraction must double every 9 years, niobium extraction must double every 6 years—forever!

While it is possible that pre-recession global NNR extraction/production CAGRs can be reestablished and maintained in some cases for limited periods of time, it is impossible that these CAGRs can be reestablished and maintained in all or even most cases for an indefinite period of time.

Global NNR Reserves Adequacy “Years to Exhaustion” is the number of years that proven global NNR reserves would last assuming the reestablishment of pre-recession (2000-2008) compound annual growth rates (CAGRs) in annual NNR extraction/production.

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Years to Exhaustion Associated with Proven Global NNR Reserves Years Until Exhaustion* NNR # NNRs 1-10 Years 11-20 Years

4 13

21-30 Years

7

31-40 Years

12

Antimony, Diamond (industrial), Garnet, Lithium Arsenic, Barite, Bismuth, Iron Ore, Lead, Manganese, Molybdenum, Niobium, Silver, Strontium, Tin, Zinc, Zirconium Cadmium, Chromium, Cobalt, Copper, Fluorspar, Nickel, Rhenium Bauxite, Boron, Coal, Gold, Graphite, Mercury, Natural Gas, Oil, Thallium, Titanium Concentrates, Tungsten, Uranium

* Reserve to production (R/P) data used for NNRs with negative 2000-2008 CAGRs: thallium, mercury, gold, cadmium, and boron.

In the event that pre-recession CAGRs are reestablished going forward, proven global reserves associated with 36 of the 89 analyzed NNRs would exhaust within 40 years (by 2048)—including bauxite in 40 years, coal in 40 years, cobalt in 26 years, copper in 27 years, iron ore in 15 years, manganese in 17 years, molybdenum in 20 years, natural gas in 34 years, nickel in 30 years, oil in 39 years, tin in 18 years, uranium in 34 years, and zinc in 13 years.

While it is extremely unlikely that global reserves associated with any of these NNRs will exhaust completely by 2048, barring significant new NNR discoveries and/or new technologies that dramatically increase recoverable NNR quantities, many of these NNRs will likely become increasingly scarce going forward.

Impending Global NNR Extraction/Production Peaks The annual global extraction/production levels associated with the following 18 NNRs, which are either critical or indispensible to modern industrial existence, are projected to peak by the year 8 2035.

Projected Global Peak NNR Extraction/Production Years NNR and Projected Peak Extraction/Production Year Chromium – 2035 Coal – 2030 Cobalt – 2035 Copper – 2030 Indium – 2018 Iron Ore – 2015

NNR and Projected Peak Extraction/Production Year Magnesium Metal – 2010 Manganese – 2024 Molybdenum – 2025 Natural Gas – 2025 Nickel – 2025 Oil – 2017

NNR and Projected Peak Extraction/Production Year Phosphate Rock* – 1988 Platinum Group Metals* – 2005 Tin – 2018 Titanium Concentrates – 2025 Tungsten – 2010 Zinc – 2020

*Possibly already reached global peak extraction.

While it is unlikely that all of these global extraction/production peak projections will be realized, it is likely that many or most of these NNRs will become increasingly scarce in the future.

Global NNR Scarcity Summary Assessment Total global NNR requirements—i.e., the NNR quantities (economic inputs) necessary to perpetuate pre-recession global economic output (GDP) and growth—had put increasing pressure on globally available, economically viable NNR supplies since the beginning of the new millennium.

By 2008, global NNR requirements exceeded globally available, economically viable NNR supplies in the vast majority of cases.

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• • •

63 of the 89 analyzed NNRs were scarce globally in 2008.

28 of the 89 analyzed NNRs are “almost certain” to remain scarce permanently in the event that the global economy recovers completely from the Great Recession.

16 of the 89 analyzed NNRs will “likely” remain scarce permanently in the event that the global economy recovers completely from the Great Recession.

Going forward, 39 of the 89 analyzed NNRs are considered “at risk” globally. That is, globally available, economically viable supplies associated with these NNRs and derived goods and services will likely experience increasingly severe shortages, as industrialized and industrializing nations attempt to reestablish and exceed pre-recession global economic output (GDP) levels and growth rates on a continuous basis.

Global “At Risk” NNRs Nonrenewable Natural Resource (NNR)

Antimony Bauxite Beryllium Bismuth Cadmium Chromium Coal Cobalt Copper Fluorspar Graphite (Natural) Indium Iron Ore Iron/Steel Lead Lithium Magnesium Metal Manganese Molybdenum Natural Gas Nickel Niobium Nitrogen (Ammonia) Oil Phosphate Rock Platinum Group Metals (PGM) Potash Rhenium Selenium Silver Sulfur Tellurium Thallium Tin Titanium Mineral Concentrates Tungsten Uranium Zinc Zirconium

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NNR Criticality

Permanent Global NNR Scarcity

Critical Indispensible Critical Critical Important Indispensible Indispensible Indispensible Indispensible Critical Critical Critical Indispensible Indispensible Critical Critical Indispensible Indispensible Critical Indispensible Critical Critical Indispensible Indispensible Indispensible Indispensible Indispensible Critical Important Critical Indispensible Critical Important Critical Indispensible Critical Critical Indispensible Critical

Almost Certain Likely Likely Almost Certain Likely Almost Certain Almost Certain Almost Certain Almost Certain Likely Likely Almost Certain Almost Certain Almost Certain Almost Certain Likely Likely Almost Certain Almost Certain Almost Certain Likely Almost Certain Almost Certain Almost Certain Almost Certain Likely Almost Certain Almost Certain Almost Certain Almost Certain Almost Certain Almost Certain Likely Almost Certain Almost Certain Likely Almost Certain

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Permanent Global Peak Extraction/ Production

By 2038 Likely in 1961 By 1988* By 2035 By 2030 By 2035 By 2030

By 2018 By 2015 By 1990* By 2010 By 2024 By 2025 By 2025 By 2025

By 2017 By 1988* By 2005*

Years to Global Reserves Exhaustion (from 2008) 8 years 40 years 17 years 25 years** 26 years 40 years 26 years 27 years 23 years 38 years 15 years 17 years 8 years 17 years 20 years 34 years 30 years 15 years 39 years

22 years Likely in 1996 By 2010 Likely in 1974 Likely in 1989 By 2018 By 2025 By 2010 By 1982* By 2020

11 years

38 years** 18 years 37 years 32 years 34 years 13 years 19 years

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* The (Verhulst) logistics curve fitting analysis projected global peak extraction/production prior to the year 2010. However, either the projected peak was subsequently exceeded or it is currently unclear whether the pre-2010 peak is permanent. While the Verhulst methodology is naturally subject to inaccuracy with regard to precise peak NNR extraction/production timing, it is a viable indicator of existing or impending NNR scarcity. ** 2008 reserve to production (R/P) data were used in lieu of extrapolated extraction/production projections because the 2000-2008 compound annual growth rate (CAGR) associated with annual global extraction/production was negative.

The Great Recession marked a tipping point in world history as well. Epidemic permanent global NNR scarcity experienced by the onset of the Great Recession permanently depressed the future growth trajectories associated with global economic output (GDP) and societal wellbeing.

NNR Scarcity and Modern Industrial Existence Water comes from turning on a faucet; electricity comes from a wall socket; light comes from flipping a switch; heat and air conditioning come from adjusting a thermostat; food comes from a grocery store; gasoline comes from a gas station; and instantaneous global communication comes from pressing buttons on a handheld electronic device—right?

Actually, these essential attributes of our modern industrial existence, in addition to nearly all others, are enabled by NNRs. The following analysis considers NNR scarcity as it relates to five critical NNR-enabled application areas, each of which is essential to modern industrial existence: • • • • •

Essential Infrastructure Primary Energy Generation Industrial Agriculture Computers and Other High Technology Electronic Devices Emerging “Green” Technologies (Electric Cars, Wind Turbines, and Solar Cells)

Consider in each case the domestic (US) peak (to date) NNR extraction/production year, the domestic (US) NNR import percentage, the likelihood regarding permanent NNR scarcity, and the potential geopolitical NNR supply constraints.

Given America’s extraordinary levels of foreign NNR dependence and vulnerability, and the fact that all industrialized and industrializing nations are similarly dependent and vulnerable, the potential for conflict—resource wars—will certainly increase going forward as these NNRs become increasingly scarce.

NNRs Used in Essential Infrastructure The physical foundation of every industrialized nation is infrastructure—buildings, roads, systems, and networks. Infrastructure consists almost entirely of NNRs; and it is produced, provisioned, and maintained almost exclusively through the utilization of NNRs.

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NNRs Used in Essential Infrastructure Infrastructure Peak US 2008 US NNR Extraction/ Import Production Percent Year (to date)

Permanent Scarcity US Global

Abrasives

1974

76%

Almost Certain

Unclear

Aluminum

1980

24%

Almost Certain

Unclear

Boron

1995

0%

Unclear

Unclear

Cement Chromium

2005 1956

11% 66%

Unclear Almost Certain

Unclear Almost Certain

Clays

1973

0%

Unlikely

Unclear

Cobalt

1958

81%

Almost Certain

Almost Certain

Copper

1998

31%

Gypsum

2006

24%

Almost Certain Almost Certain

Almost Certain Likely

Iron/Steel

1973

13%

Likely

Lead

1970

0%

Almost Certain

Almost Certain Almost Certain

Magnesium

1943

50%

Almost Certain

Likely

Manganese

1918

100%

Almost Certain

Almost Certain

Molybdenum

1980

0%

Unclear

Almost Certain

Nickel

1997

34%

Almost Certain

Likely

Sand and Gravel

2006

0%

Unlikely

Unclear

Silicon

1979

52%

Likely

Stone (Crushed)

2006

1%

Almost Certain Unlikely

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Unclear

Potential Geopolitical Supply Constraints 83% of US fused aluminum oxide and crude silicon carbide are imported from China 56% of US aluminum imports come from Canada 72% of proven global boron reserves are located in Turkey Over 75% of proven global reserves are located in South Africa and Kazakhstan 84% of US clay imports come from Brazil Over half of the proven global cobalt reserves are located in the Congo 40% of US copper imports come from Chile China is the world’s second largest gypsum producer, Iran is third China is the world’s leading steel producer China accounts for 40% of global lead mine production 40% of US magnesium metal imports come from Canada Over 50% of proven global manganese reserves are located in South Africa and the Ukraine Nearly 40% of proven global molybdenum reserves are located in China Nearly 40% of proven global nickel reserves are located in Australia 75% of US construction sand and gravel imports come from Canada China produces 65% of the world’s silicon 43% of US crushed stone imports come from Canada

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NNRs Used in Essential Infrastructure (continued) Infrastructure Peak US 2008 US NNR Extraction/ Import Production Percent Year (to date)

Permanent Scarcity US Global

Tin

1945

80%

Almost Certain

Almost Certain

Titanium

1989

54%

Almost Certain

Unclear

Vanadium

1981

100%

Almost Certain

Likely

Zinc

1969

71%

Almost Certain

Likely

Potential Geopolitical Supply Constraints China and Indonesia each produce over 40% of the world’s tin 52% of US titanium sponge metal imports come from Kazakhstan China and South Africa each account for approximately 40% of global vanadium production 68% of US zinc ore and concentrate imports come from Peru

NNRs Used In Primary Energy Generation Nothing moves in the absence of energy. Currently, 90% of the primary energy that powers our 9 industrialized and industrializing world is provided by nonrenewable energy sources —and none of the emerging renewable primary energy sources could exist in the absence of NNRs. NNRs Used In Primary Energy Generation Primary Peak US 2008 US Energy NNR Extraction/ Import Production Percent Year (to date)

Permanent Scarcity US Global

Coal (27%)

2008

0%

Unclear

Almost Certain Almost Certain

Natural Gas (23%)

1973

13%

Likely

Oil (35%)

1970

57%

Almost Certain

Almost Certain

Uranium (5%)

1981

78%

Almost Certain

Almost Certain

Potential Geopolitical Supply Constraints

Nearly 100% of US natural gas imports come from Canada Approximately 80% of proven world oil reserves are in the Middle East Canada, Australia, and Kazakhstan each produce approximately one quarter of the world’s annual uranium supply

NNRs Used in Industrial Agriculture Industrialized populations could not exist in the absence of industrial agriculture; and industrial 10 agriculture could not exist in the absence of NNRs. NNRs are the primary components of agricultural machinery, agricultural facilities, fertilizers, pesticides, herbicides, and fungicides.

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NNRs Used in Industrial Agriculture Industrial Peak US Agriculture Extraction/ NNR Production Year (to date)

2008 US Import Percent

Permanent Scarcity US Global

Boron

1995

0%

Unclear

Unclear

Copper

1998

31%

Iron

1953

0%

Almost Certain Unclear

Almost Certain Almost Certain

Magnesium

1943

50%

Almost Certain

Likely

Manganese

1918

100%

Almost Certain

Almost Certain

Molybdenum

1980

0%

Unclear

Almost Certain

Natural Gas

1973

13%

Likely

Nitrogen (Ammonia)

1980

42%

Almost Certain

Almost Certain Almost Certain

Oil

1970

57%

Almost Certain

Almost Certain

Phosphate Rock

1980

4%

Likely

Almost Certain

Potash

1967

84%

Almost Certain

Likely

Selenium

1969

0%

Unclear

Almost Certain

Sulfur

1981

25%

Almost Certain

Almost Certain

Zinc

1969

71%

Almost Certain

Likely

Potential Geopolitical Supply Constraints 72% of proven global boron reserves are located in Turkey 40% of US copper imports come from Chile China accounts for more than half of annual global iron ore extraction 40% of US magnesium metal imports currently come from Canada Over 50% of proven global manganese reserves are located in South Africa and the Ukraine Nearly 40% of proven global molybdenum reserves are located in China

55% of US ammonia imports come from Trinidad and Tobago Approximately 80% of the world’s proven oil reserves are located in the Middle East 100% of US phosphate rock imports come from Morocco over 50% of proven global potash reserves are located in Canada 46% of US selenium imports come from Belgium 71% of US elemental sulfur imports from Canada 68% of US zinc ore and concentrate imports come from Peru

NNRs Used in Computers and Other High Tech Electronic Devices 11

NNRs are the primary components of computers and of all electrical and electronic communication, medical, defense, and consumer products that enable modern industrial existence.

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NNRs Used in Computers and Other High Tech Electronic Devices Computer and Peak US 2008 US Permanent High Tech NNR Extraction/ Import Scarcity Production Percent US Global Year (to date) Aluminum

1980

24%

Almost Certain Almost Certain Almost Certain Almost Certain Unclear

Unclear

Antimony

1948

93%

Arsenic

1944

100%

Barite

1981

80%

Beryllium

1980

17%

Bismuth

Never Mined in the US

94%

Almost Certain

Almost Certain

Cadmium Chromium

1969 1956

0% 66%

Unclear Almost Certain

Likely Almost Certain

Cobalt

1958

81%

Almost Certain

Almost Certain

Copper

1998

31%

Europium (REM)

1984

100%

Almost Certain Unclear

Gallium

1978

99%

Almost Certain Almost Certain Almost Certain

Germanium

1981

90%

Unclear

Gold

1998

0%

Almost Certain Unclear

Indium

1966

100%

Almost Certain

Iron (Ore)

1953

0%

Unclear

Lead

1970

0%

Almost Certain

Almost Certain Almost Certain

Manganese

1918

100%

Almost Certain

Almost Certain

Mercury

1943

0%

Unclear

Unclear

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Almost Certain Unclear Almost Certain Likely

Unclear

Almost Certain Almost Certain

Potential Geopolitical Supply Constraints

51% of US antimony imports come from China 86% of US arsenic metal imports come from China 93% of US barite imports come from China 58% of US beryllium imports come from Kazakhstan Over 2/3 of proven global bismuth reserves are located in China Over 75% of proven global reserves are located in South Africa and Kazakhstan Over half of the proven global cobalt reserves are located in the Congo 40% of US copper imports come from Chile China accounts for 95% of global REM extraction China, Kazakhstan, and the Ukraine are 3 of the top 4 producers of unrefined gallium China produces a majority of the world’s germanium China is the leading gold producing nation Half of the proven global indium reserves are located in China

China accounts for 40% of global lead mine production Over 50% of proven global manganese reserves are located in South Africa and the Ukraine China accounts for 2/3 of global mercury extraction

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NNRs Used in Computers and Other High Tech Electronic Devices (continued) Computer and Peak US 2008 US Permanent High Tech NNR Extraction/ Import Scarcity Potential Geopolitical Production Percent Supply Constraints US Global Year (to date) Nickel

1997

34%

Almost Certain

Likely

Never Mined in the US

100%

Almost Certain

Almost Certain

Palladium (PGM)

2002

79%

Unclear

Plastics (Oil)

1970

57%

Almost Certain Almost Certain

Platinum (PGM)

2002

89%

Almost Certain

Unclear

Ruthenium (PGM)

2002

89%*

Unclear

Rhodium (PGM)

2002

89%*

Selenium

1969

0%

Almost Certain Almost Certain Unclear

Silicon

1979

52%

Likely

Silver

1916

67%

Never Mined in the US

100%

Almost Certain Almost Certain Almost Certain

Terbium (REM)

1984

100%

Tin

1945

80%

Titanium

1989

Vanadium

Niobium

Tantalum

Almost Certain

Nearly 40% of proven global nickel reserves are located in Australia Brazil produces about 75% of the world’s supply of niobium 46% of US palladium imports come from Russia Approximately 80% of the world’s proven oil reserves are located in the Middle East South Africa produces about 79% of the world’s platinum

Unclear Almost Certain

Almost Certain Unlikely

Almost Certain Almost Certain

Unclear

54%

Almost Certain

Unclear

1981

100%

Almost Certain

Likely

Yttrium (REM)

1984

100%

Unclear

Zinc

1969

71%

Almost Certain Almost Certain

Almost Certain

Likely

46% of US selenium imports come from Belgium China produces 65% of the world’s silicon 54% of US silver imports come from Mexico A vast majority of proven global tantalum reserves are located in Australia (36%) and Brazil (59%) China accounts for 95% of global REM extraction China and Indonesia each produce over 40% of the world’s tin 52% of US titanium sponge metal imports come from Kazakhstan China and South Africa each account for approximately 40% of global vanadium production China accounts for 95% of global REM extraction 68% of US zinc ore and concentrate imports come from Peru

* Platinum import data; specific data for ruthenium and rhodium are not available.

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NNRs Used in Emerging Technologies In addition to many of the above listed NNRs, emerging technologies often require additional “exotic” NNRs to address specialized energy storage, electric motor, and integrated circuit 12 applications.

NNRs Used in Emerging Technologies Emerging Peak US 2008 US Technology Extraction/ Import NNR Production Percent Year (to date)

Permanent Scarcity US Global

Dysprosium (REM) [Permanent Magnets]

1984

100%

Almost Certain

Unclear

Lanthanum (REM) [Batteries]

1984

100%

Almost Certain

Unclear

Lithium [Batteries]

1954

>50%

Almost Certain

Likely

Neodymium (REM) [Permanent Magnets]

1984

100%

Almost Certain

Unclear

Phosphorous [Solar Cells]

1980

4%

Likely

Almost Certain

Samarium (REM) [Permanent Magnets]

1984

100%

Almost Certain

Unclear

Tellurium [Solar Cells] Terbium (REM) [Permanent Magnets]

1960

100%

Unclear

1984

100%

Almost Certain Almost Certain

Unclear

Potential Geopolitical Supply Constraints 91% of US REM imports come from China; China accounts for 95% of global REM extraction 91% of US REM imports come from China; China accounts for 95% of global REM extraction 63% of US lithium imports come from Chile, 76% of proven global lithium reserves are located in Chile 91% of US REM imports come from China; China accounts for 95% of global REM extraction 100% of US phosphate rock imports come from Morocco 91% of US REM imports come from China; China accounts for 95% of global REM extraction 43% of US tellurium imports come from China 91% of US REM imports come from China; China accounts for 95% of global REM extraction

NNR Scarcity and Modern Industrial Existence Summary Assessment NNRs enable literally every aspect of modern industrial existence; and most NNRs, especially those that are indispensible to our industrialized way of life, are now permanently scarce both domestically (US) and globally.

We may be able to mitigate or even overcome NNR scarcity in some cases through technical innovation, substitution, conservation, recycling, efficiency improvements, and productivity enhancements. We cannot, however, possibly mitigate or overcome NNR scarcity in all or even most cases.

NNR scarcity is epidemic, domestically (US) and globally; and it is increasing both in terms of incidence and severity despite our efforts and hopes to the contrary. Our incessant quest for global industrialization—and our consequent ever-increasing demand for nearly all NNRs within an environment of increasingly constrained NNR quantities and continuously diminishing NNR quality—will overwhelm our efforts to mitigate the ultimately devastating effects of NNR scarcity.

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