The Business of Burning WMDs

Brian Hicks

Posted June 23, 2014

Not a week goes by that you don’t hear about the threat of weapons of mass destruction in the news.

It’s either us hunting the Iranians’ elusive — and perhaps nonexistent — nuclear development program or the Russians mentioning (not so subtly) that they’ve still got hundreds of warheads pointed at us — just in case we were thinking about throwing our weight around in their dealings with Ukraine.

If that fails, North Korea can always be counted on to stage another “test-firing” of one of its nuclear-capable, intercontinental ballistic missiles.

However, it’s chemical weapons, also known as the “poor man’s WMD,” that pose a more realistic threat to political stability across the world.

chemical weaponsThey’re deadly, they’re cheap, they’re relatively easy to manufacture, and they can be delivered using very primitive, portable missile and artillery systems.

Worst of all, some of the least friendly nations in the world have them.

Syrian dictator — or president, as he likes to be called — Bashar al-Assad is said to control hundreds of tons of sarin, mustard, and VX gas, with the capacity to produce even more.

The North Koreans, not to be outdone, have over 5,000 tons of blister, nerve, choking, psychoincapacitant, vomiting, and riot-control agents (fun sounding lineup), with the ability to produce as much as 4,500 tons more per year.

Russia has destroyed more than 60% of its stockpile, leaving it now with just 15,000 tons of the nastiest, deadliest chemical agents known to man.

We have no idea how much the Chinese have, but if the pattern holds, it’s likely more than everyone else combined.

Turning Weapons into Smoke

Our own stockpiles are now down 89% from their peak levels, with the main three — mustard, sarin, and VX nerve agent — mostly incinerated at facilities such as the Johnston Atoll Chemical Agent Disposal System (JACADS), located on a remote Pacific island.

Johnsoton Atoll Chemical Agent Disposal SystemThousands of miles from any major population centers, the JACADS burned these noxious chemicals, releasing the waste materials into the sky, where the atmosphere absorbed and dissipated them to harmless concentrations.

This, along with burial deep underground in specially sealed canisters, was the main method by which chemical weapons were effectively “deactivated.”

Aside from being harmful to the environment, these facilities and methods were costly, complicated endeavors to undertake.

The solution had to be modular, portable, and clean.

Disposing of Mass Death in the 21st Century

Montreal-based PyroGenesis Canada Inc. (TSX-V: PYR) already has the answer.

The company’s proprietary technology allows for the portable, highly versatile disposal of nerve agents in a way that’s so environmentally non-impacting that it can be done close to the theater of operations or storage location where the materials were recovered on portable platforms such as naval vessels.

PyroGenesis’s Tactical Plasma Arc Chemical Warfare Agents Destruction System, or Tactical PACWADS, is designed to rapidly and safely destroy a wide range of chemical warfare agents as well as their precursors (anyone who’s watched Breaking Bad will understand what a precursor is) in the field.

PPlasma Arc Waste Destruction Systemictured to the right is a Plasma Arc Waste Destruction System installed on board the lead ship of the U.S. Navy’s newest class of supercarriers, the USS Gerald R. Ford.

Alleviating the need to transport enemy chemical agents to a remote location, putting soldiers and civilians at risk of ambush or the catastrophic release of their deadly payloads, the Tactical PACWADS can be operated on site to destroy the big three chemical agents: sarin (GB), mustard (HD), and VX.

Using a 9,000°F plasma torch, the compact Tactical PACWADS reactor and associated self-contained gas cleaning equipment will allow the crews to rapidly set up two readily deployable, mobile 20-foot containers and safely destroy up to two barrels of chemical agents per day.

It’s an amazing development and a solution to a problem that is scalable and readily applicable to the tens of thousands of tons of deadly material slated for destruction around the world.

These systems can be based either on ships or out of standard shipping containers, with easy transportability to anywhere in the world.

9,000 Degrees of Market Versatility

However, it’s important to understand that destruction of chemical warfare agents isn’t the company’s main business… That’s just one application for its high-temperature plasma technology.

plasma torches

PyroGenesis’s plasma torches, which are powered by electricity and therefore produce zero carbon emissions themselves, have been employed in waste-to-energy technology as well, allowing for the transformation of refuse materials and chemicals into clean fuels.

The extremely high-temperature torches are also useful in the creation of experimental materials, including the production of fumed silica (an essential component of everything from skin creams to adhesives), the production of nanomaterials, and the production of high-tech spherical metal powders.

PyroGenesis is the sort of company aggressive traders adore because it has a firm hold on a single, widely applicable technology with giant future prospects.

They also love it for the packaging it comes in.

PyroGenesis is in the stage of its life where there’s the most to gain from future expansion and licensing deals — which are sure to be in the works given the company’s high-profile partnerships with entities such as the U.S. Navy.

It trades at $0.60 with a $40 million market capitalization.

This compact share structure is exactly what profit-seeking investors like the most, because when big news comes (it just recently made headlines by signing a contract to expand its involvement with the U.S. military, with potential involvement in Syria), it makes a major impact.

As the chemical warfare agent disposal market is only now starting to pick up, and with at least half a dozen other high-profile applications for its plasma torch technology, PyroGenesis Canada is definitely one whose time has come.

Keep a close eye on it.

Yours in wealth,

Brian Hicks Signature

Brian Hicks

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Brian is a founding member and President of Angel Publishing. He writes about general investment strategies for Wealth Daily and Energy & Capital. For more on Brian, take a look at his editor’s page.

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