Rare earths and China’s self-correcting folly – Alan Beattie (Financial Time – January 8, 2015)

http://blogs.ft.com/beyond-brics/

This week, a trade war that was supposed to tear the world of high-tech manufacturing apart ended peacefully, quietly and with few casualties.

China announced plans that would comply with a WTO decision from last year by removing export quotas and other restrictions on rare earth elements (REEs), the minerals used widely in the manufacture of electronics, computers and cars. It was another success for the US, which has not only chalked up a series of impressive wins against China in the WTO’s dispute settlement process but also (by no means a given) often succeeded in getting Beijing to implement the decisions.

So, a big victory for global governance? Huzzah for the international rule of law, and a celebratory round of Dan Drezners? Sort of. In reality, it was the free market as much as trade rules that did for China’s attempt to corner global commerce in rare earths. Moreover, in a rather choice irony, Chinese companies employed the very tricks that they use to sidestep trade restrictions by other governments to sabotage the export quotas set by their own.

By 2010, China produced 97 per cent of the world’s basic rare earth oxide production and much of the processing business. In its submission to the WTO, Beijing laughably argued that a complex system of export restrictions it had placed on its REE companies since the mid-2000s was aimed at protecting the environment by controlling mining.

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New tech-dependent nations desperate for non-Chinese REE sources – by Dorothy Kosich (Mineweb.com – November 11, 2014)

http://www.mineweb.com/

In recent years, Chinese production has accounted for about 95% of the REE global market.

RENO (MINEWEB) – The U.S. Geological Survey has released a report, which supports scientific research to determine where undiscovered/undeveloped resources of rare-earth elements may occur, as well as trends in the supply and demand of rare-earth elements domestically and internationally.

Because of the many important uses of REEs, nations dependent on new technologies, such as Japan, the United States and members of the European Union, which now must rely on Chinese REE exports, are encouraging discoveries of economic REE deposits and bringing them into production, says the Geological Survey.

“Most REEs are not as rare as the group’s name suggests,” says the new report, The Rare Earth Elements—Vital to Modern Technologies and Lifestyles. “Cerium is the most abundant REE, and is more common in the Earth’s crust than copper or lead.”

“All of the REEs, except promethium, are more abundant on average in the Earth’s crust than silver, gold, or platinum. However, concentrated and economically minable deposits of REEs are unusual,” according to the Geological Survey.

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Quebec First Nations petition province to include rare earths under uranium ban – by Henry Lazenby (MiningWeekly.com – November 6, 2014)

http://www.miningweekly.com/page/americas-home

TORONTO (miningweekly.com) – A group of Quebec- and Labrador-based First Nations would like to see the Quebec government include rare earth elements in the same moratorium currently in force for uranium.

The Quebec government had decreed a moratorium on issuing exploration, development or mining permits for uranium projects in the province on March 28, 2013, until an independent study of the impacts of uranium was completed.

The Assembly of the First Nations of Quebec and Labrador (AFNQL), which currently represented 43 tribal chiefs, said, during an assembly last month, the First Nations resolved to support the Eagle Village and Wolf Lake Algonquin First Nations in opposing Canadian firm Matamec Explorations’ proposed Kipawa rare earths project on First Nation reserve lands.

The AFNQL noted that it would communicate its position to the Bureau d’audiences publiques sur l’environnement (BAPE), which was holding public hearings this month on the uranium industry in Quebec.

The local opposition to uranium exploration and mining had all but snuffed out the provincial industry, exemplified by uranium project developer Strateco Resources in June, when it mothballed its flagship Matoush project, in the Otish Mountains, after spending more than $123-million.

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Moon exploration will reduce the shortage of rare earth metals – by Aram Ter-Ghazaryan (Russia Beyond the Headlines – October 26, 2014)

http://rbth.com/

Russian scientists are already referring to the Moon as a hub for flights to other planets. However, the main goal in exploring Earth’s satellite is to expand the production of rare earth metals.

As part of the Federal Space Program, Moon exploration operations will be launched in 2016. In 2018 the first spacecraft will be sent to the Moon to deliver comet material back to Earth. A manned flight is scheduled for 2030-2031. Future plans include the mining of rare earth metals required for the development of high-tech industries.

Looking for comet substances on the lunar south pole

Scientists from the Russian Academy of Sciences, the Moscow State University Sternberg Astronomical Institute and the Russian Federal Space Agency are participating in this Moon exploration project.

The first spacecraft to be sent to the Moon will be relatively simple. According to Vladislav Shevchenko, the Sternberg Institute’s Head of the Department of Lunar and Planetary Research, this is because the Russian space program has not carried out a Moon landing for over 40 years.

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Analysis Iron ore and rare earth metals mining: an industry under siege? – by Wayne Visser (The Guardian – October 24, 2014)

http://www.theguardian.com/us

Resource scarcity and human rights issues surrounding metals extraction, coupled with unrelenting global demand mean the industry is facing some tough realities

The good news: the number of people living in extreme poverty could drop from 1.2 billion in 2010 to under 100 million by 2050, according to UN projections. The bad news is that the flotilla of hope currently rising on the tide of economic growth in emerging countries is at serious risk of being dragged down under the waves. The reason is growing resource scarcity and the environmental disasters that could ensue.

As always, the poorest will be worst affected. The UNDP projects that, under an environmental disaster scenario, instead of reducing the population living in extreme poverty in south Asia from over half a billion to less than 100m by 2050, it could rise to 1.2bn. In sub-Saharan Africa, the numbers may rise from under 400m to over a billion. For the world as a whole, an environmental disaster scenario could mean 3.1 billion more people living in extreme poverty in 2050, as compared with an accelerated development scenario.

The message is simple: unless these booming economies – and the high-income countries they churn out ‘widgets’ for – can lighten the weighty anchor of resource consumption, we will all, sooner or later, get that sinking feeling. To illustrate the point, demand for steel – driven in no small part by a global car fleet doubling to 1.7bn by 2030 – is expected to increase by about 80% from 1.3bn tonnes in 2010 to 2.3bn tonnes in 2030. These trends raise red flags about material shortages of many metals in the future.

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RB Energy meltdown highlights tough times for lithium, rare earth firms – by Peter Koven (National Post – October 20, 2014)

The National Post is Canada’s second largest national paper.

TORONTO — As RB Energy Inc. flamed out and fell into creditor protection during the past couple of weeks, investors were shell-shocked.

Despite some start-up problems in recent months, Vancouver-based RB seemed to be in an ideal position. It was emerging as North America’s only serious lithium producer, just as demand for the metal is set to soar because of its use in electric vehicle batteries. Its management team was linked to the legendary Lundin Group, a resource conglomerate with a fantastic track record of success. Lundin companies do not just melt down like that.

But RB did. It filed for protection last Monday after its stock price collapsed and it could not raise capital under reasonable terms.

“I can tell you it’s been a long time since I’ve seen the resource capital market crash as quickly as that,” chief executive Rick Clark said. “I would say the last time was back in the ‘90s.”

There was a time when RB, formerly known as Canada Lithium Corp., had a much easier time raising cash. The company has tapped the capital markets for about $268-million since 2009, according to Financial Post data. RB also received $92-million of debt financing from Bank of Nova Scotia and Caterpillar Financial Services that was partially guaranteed by the Quebec government.

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RB Energy says TSX statement a key factor in CCAA filing – by Peter Koven (National Post – October 20, 2014)

The National Post is Canada’s second largest national paper.

TORONTO — The chief executive of RB Energy Inc. believes the lithium miner might have avoided insolvency if not for a two-sentence statement issued by the Toronto Stock Exchange.

CEO Rick Clark said in an interview the company thought it had a $70-million financing package lined up in mid-September that would have resolved its liquidity issues. But then the TSX, following its guidelines, issued a blanket press release saying it was conducting a de-listing review of the stock.

The TSX statement simply repeated what Vancouver-based RB said the day before. But the stock price collapsed as soon as it came out, and Mr. Clark said he could no longer line up financing on reasonable terms.

Instead, he elected to file for creditor protection last Monday. “We got absolutely hit in the side of the head [by the TSX statement],” said Mr. Clark, who was formerly CEO of market darling Red Back Mining Inc. Regardless, he said he does not want to blame the exchange for what happened.

The impact of the TSX announcement on Sept. 16th is undeniable. The stock plunged 25% that day, with 14.4 million shares changing hands. It then fell another 25% during the following five trading days and could not recover.

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Japan loosens China’s grip on rare earths supplies – by Sonali Paul and Yuka Obayashi (Reuters U.S. – September 4, 2014)

http://www.reuters.com/

MELBOURNE/TOKYO – (Reuters) – Japan is pushing to secure at least 60 percent of its rare earth needs from outside China within four years, as it bolsters efforts to curb its dependence on the world’s biggest producer of elements crucial in smart phones, computers and cars.

Japan aims to sign a deal as early as this month that would give it four types of light rare earths from India, and has helped fund an Australian rare earths mine and Malaysian processing plant built by Australia’s Lynas Corp.

Its search for supply security has also led to a joint venture in Kazakhstan, recycling rare earths from batteries and motor magnets, and even exploring for rare earths in the Pacific Ocean seabed. China currently produces about 90 percent of the world’s rare earths.

Japan, which sources virtually all its rare earths from China, either directly or indirectly, has been trying to find new sources of supply since its neighbor held back shipments in 2010 during a row over disputed islands and then curbed global exports to preserve its own resources.

“It is critically important for Japan to secure sources of rare earths outside of China,” said Akira Terakawa, deputy director at mineral and natural resources division of Ministry of Economy, Trade and Industry.

The Indian deal would provide 15 percent of Japan’s needs. If Lynas is able to ramp up production as agreed, Japan could be sourcing more than 60 percent of its expected rare earths demand from outside China by 2018, based on Reuters calculations from Japanese demand data and growth figures provided by a trading house which deals with rare earths.

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Vanadium: The metal that may soon be powering your neighbourhood – by Laurence Knight (BBC World Service – June 13, 2014)

http://www.bbc.com/news/

Hawaii has a problem, one that the whole world is likely to face in the next 10 years. And the solution could be a metal that you’ve probably never heard of – vanadium.

Hawaii’s problem is too much sunshine – or rather, too much solar power feeding into its electricity grid. Generating electricity in the remote US state has always been painful. With no fossil fuel deposits of its own, it has to get oil and coal shipped half-way across the Pacific.

That makes electricity in Hawaii very, very expensive – more than three times the US average – and it is the reason why 10% and counting of the islands’ residents have decided to stick solar panels on their roof.

The problem is that all this new sun-powered electricity is coming at the wrong place and at the wrong time of day.

Hawaii’s electricity monopoly, Heco, fears parts of the grid could become dangerously swamped by a glut of mid-day power, and so last year it began refusing to hook up the newly-purchased panels of residents in some areas.

And it isn’t just Hawaii.

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The 800 Pound Gorilla in the room for rare earth sustainability in North America – thorium – by Alessandro Bruno (Investorintel.com – August 3, 2014)

http://investorintel.com/

The West must deal with thorium content limits before it can hope to become rare-earths independent…

James Kennedy works closely with the Thorium Energy Alliance to promote US legislation for the commercial development of thorium energy systems and rare earths. And when he asked me to review a video where he presents a paper entitled “Creating a Multinational Platform, Thorium, Energy and Rare Earth Value Chain – a Global Imbalance in the Rare Earth Market” – it occurred to me that Tracy’s frequently referenced ‘800 lb. gorilla’ in the proverbial rare earth room was overdue for discussion: thorium.

Kennedy’s essential argument is that the rare earth imbalance is largely the result of regulations with unintended consequences: “Rare earths and thorium have become linked at the mineralogical and geopolitical level.” In other words, thorium should be considered as a rare earth mineral.

There is, in fact, a close relationship between thorium and rare earths; they often come together. In fact, monazite, was first mined to produce thorium and rather than rare earths. In the 19th century, thorium was used to make gas mantles. Later, with the development of technology that required rare earths to function, monazite started to be mined for elements other than thorium. Meanwhile, monazite itself is a by-product.

It is separates easily, through gravity and at almost no cost, in the mining of titanium or zirconium, such that the monazite can be said to be produced practically free of charge. The United States was the leading supplier of monazite – which was in the main source of rare earths – in the first decades of the rare earths industry (the post WW2 period).

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The obscure metal that could solve solar energy’s conundrum – by Carl Mortished (Globe and Mail – July 16, 2014)

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

On the fringes of global stock markets, fascination with materials continues and the latest obscure object of adoration is vanadium, a metal you may have never heard of but which is well known in the steel industry because it does the neat trick of making steel both stronger and lighter.

Add a couple of pounds of vanadium to a ton of steel and you double its strength, a formula that excites Largo Resources Ltd., a Toronto-listed miner that is only weeks away from opening a Brazilian mine that could supply almost a 10th of the worldwide vanadium market in two to three years time.

There are few sources of the metal; China is the big producer and consumer of vanadium, taking more than half of global output. South Africa and Russia currently account for the remainder. China’s hunger for construction steel laced with vanadium is expected to increase as the government grapples with poor building standards, exposed in recent earthquakes and civil engineering disasters.

Aircraft and automobile manufacturers are also falling in love with vanadium’s dual attributes of lightness and toughness. Boeing’s Dreamliner and the Airbus A380 each contain 100 tonnes of titanium-vanadium; Largo says demand for the alloy is rising by 6.5 per cent annually, despite a global steel glut.

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Glencore kicks off $2bn takeover race for Syrah Resources – by Amanda Saunders (Sydney Morning Herald – July 10, 2014)

http://www.smh.com.au/

Swiss commodities giant Glencore is understood to have made an informal approach to Syrah Resources that could value the graphite and vanadium junior at as much as to $2 billion.

Melbourne-based Syrah’s prized asset is the mammoth Balama graphite and vanadium deposit in northern Mozambique.

After the Fairfax Media revealed Glencore’s interest on Thursday, the company’s shares surged as much as 25 per cent before it dived into a trading halt before noon. When shares were halted, Syrah’s shares were up 19 per cent at $5.09. The shares have more than doubled in value since touching a 52-week low of $2 on July 10 last year.

Syrah responded promptly to the report and a share price query from the market operator on Thursday afternoon, saying, “From time to time Syrah receives informal,confidential and non-binding enquiries from various parties regarding Syrah’s interest in entering takeover discussions”.

“None of these enquiries have progressed to formal discussions or resulted in any indicative offers being received by Syrah.”

Sources say Ivan Glasenberg’s Glencore, one of the largest producers of primary vanadium in the world, is keen to exert control over the wider vanadium market. Pouncing on Syrah and ­secur­ing its Balama project would be an early strategic play to shut out fresh competition.

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REPORT: THE RARE EARTH ELEMENTS INDUSTRY IN CANADA ─ SUMMARY OF EVIDENCE – by Standing Committee on Natural Resources (June 2014)

Standing Committee on Natural Resources – JUNE 2014 – 41st PARLIAMENT, SECOND SESSION (Government of Canada report)

INTRODUCTION

In November 2013, the House of Commons Standing Committee on Natural Resources (hereafter “the Committee”) commenced a study on the rare earth elements (REE) industry in Canada. The purpose of this study was to gain a better understanding of the challenges and opportunities related to the development of REE in Canada and around the world. This document summarizes witness testimony presented to the Committee during the course of four meetings.

It is organized according to the following topics: background information on REE and their applications; REE global market, including the role of China in rare earths supply; opportunities and challenges of developing rare earth resources in Canada with a brief overview of current exploration activity; and, ongoing initiatives that support Canada’s REE industry.

PART I — BACKGROUND

A. What Are Rare Earth Elements?

Rare earth elements (REE)1 are a group of 17 metals (including scandium and yttrium), which exhibit similar properties and occur in many of the same mineral deposits. According to Christine Villemure, Director General at Natural Resources Canada, contrary to what the term “rare earths” may suggest, REE are relatively abundant in the earth’s crust.2 However, REE seldom occur in concentrations that are economically exploitable; instead, they are found together with other elements and as a result, are difficult to separate for extraction.3

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THE RARE-EARTHS ROLLER COASTER – by Alastair Gee (The New Yorker – May 24, 2014)

http://www.newyorker.com/

Starting in early 2010, a small Canadian company called Elissa Resources spent more than $1.66 million exploring a hilly scrap of desert dotted with cacti, creosote bushes, and Joshua trees, at the southern tip of Nevada. The company was looking for rare earths: obscure metals with magnetic and luminescent properties which are used in such products as high-efficiency light bulbs, smartphones, and TV screens. The metals are also of enormous value to the defense and renewable-energy industries.

To find them, Elissa Resources employees mapped the landscape and used special devices to figure out where radiation was unusually high. The firm contracted an aircraft to measure the land’s magnetism, surveyed the area from a helicopter, and drilled twenty-one holes to figure out what was down below. But, in 2013, Elissa Resources halted major work at the site. A slump in the rare-earths market has made it hard to attract the investment needed to continue the investigations.

Most of the world’s rare earths are mined in China. In recent years, amid fears that China’s control of the market could jeopardize Western strategic interests, firms such as Elissa pursued deposits elsewhere—in the United States, Kyrgyzstan, Namibia, Vietnam, Greenland, Australia, and other countries. A boom was on. “A geologist would pick up a rock, lick it, and say, ‘Oh, I’ve got rare earths,’ and suddenly you’ve got a rare-earths company,” Gareth Hatch, a co-founder of the market-intelligence firm Technology Metals Research, said. The industry acquired an air of glamour, thanks to the futuristic uses of the metals, and a moniker suggestive of preciousness.

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Throwing stones in a glass Dacha: The West’s metal vulnerabilities – by Christopher Ecclestone (Mineweb.com – April 4, 2014)

http://www.mineweb.com/

Christopher Ecclestone of Hallgarten & Company addresses supply issues the West faces with Russia as adversary.

LONDON – Some have accused the EU and U.S. of soft-pedaling on the Crimea/Ukraine issue. But might these economic powers think twice before stirring up too much of a ruckus? The EU is particularly vulnerable to Russia cutting off natural gas exports and the U.S. has to play nice with Russia to keep getting cheap uranium supplies.

According to the US Energy Administration, in 2011 the United States mined nine percent of the uranium consumed by its nuclear power plants. The remainder was imported, principally from Russia (50%), Canada, and Australia. As uranium bulls will ceaselessly inform you the supply situation is tight and if it wasn’t for those pesky Russians the price would be a lot higher.

We usually do not make common cause with the tin-foil-hatted but would beg to agree with the uranium bulls. It is a truism that the unwinding of the Soviet stockpiles have beggared the global uranium mining industry and that the great day will be when an end to this attrition is seen.

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