US Pentagon Explores Possible Rare Earths Plant in Australia


U.S. Looks to Australia for Rare Earths

Source: MetalMiner

China’s dominance of the global rare earths market is well-documented, a fact the U.S. defense sector has grappled with in light of the elements’ use in a variety of high-tech capacities (including military applications).

In that vein, the Pentagon announced late last month that it has engaged talks with Australia regarding the possibility of hosting a rare earths processing plant in the country, Reuters reported.

According to the report, China accounts for more than 80% of global processing capacity of rare earths, a list of 17 elements that includes 15 lanthanide series elements (plus yttrium and scandium).

Ellen Lord, the Pentagon’s under secretary of defense for acquisition and sustainment, was quoted as saying that the U.S. is exploring several options to expand its rare earths footprint, of which Australia presented “one of the highest potential avenues,” Reuters reported.

Given the U.S. (and the rest of the world’s) dependence on China for rare earths, the U.S. has held back on imposing tariffs on the elements, even as it has levied hundreds of billions of tariffs on Chinese industrial products and ordinary consumer goods.

Lynas Corp Signs MOU with Western Australia City

Lynas Corp, the Australia firm that holds the title of world’s largest rare earths producer outside of China, last month scored a victory when the Malaysian government opted to extend the miner’s license to operate in the country.

The decision came after many months of uncertainty regarding the prospects of renewal, as the Malaysian government expressed concerns about waste disposal at the firm’s operations.

Although the government extended Lynas’ license, the renewal came in at a term of six months, shorter than the usual renewal period. Lynas reported receipt of the operating license renewal Aug. 22.

More recently, Lynas announced Sept. 6 that it had signed a memorandum of understanding with the Western Australia city of Kangoorlie-Boulder for “the review and due diligence of potential sites” for its new cracking and leaching plant.

“We are very pleased to announce this MOU with the City of Kalgoorlie-Boulder,” Lynas CEO Amanda Lacaze said in a prepared statement. “Kalgoorlie has a rich mining history and continues to work with industry to develop the region and its communities. Lynas already employs graduates from the WA School of Mines which is located in Kalgoorlie and we look forward to continuing this partnership.

“Access to infrastructure and a skilled workforce makes it an attractive investment destination and with this MOU we can further assess the suitability of potential sites in Kalgoorlie for our Cracking & Leaching plant.”

In other Lynas news, the company announced Australian conglomerate Wesfarmerswould not continue to pursue a potential takeover bid initially announced in 2018.

Wesfarmers issued a proposal to purchase Lynas for $2.25 per share in March, conditional on several factors that included the renewal of the rare earths producer’s Malaysian operating license.

However, Lynas announced Aug. 22 that Wesfarmers did not intend to progress with its proposal.

“Wesfarmers remains focused on delivering value to its shareholders through disciplined capital allocation within our divisions and when considering new investments,” Wesfarmers Managing Director Rob Scott was quoted as saying.

In April, Lynas’ board rejected a $1.1 billion takeover bid from Wesfarmers.

BAMM Announces West Virginia Martinka Rare Earth Mine: Coal-Based Rare Earth Said To Be First In What Will Be The Largest Rare Earth Mine Portfolio in the USA

The diversified new energy technology company, Battery and Mobility Materials, Inc. (“BAMM”) has entered into an agreement to lease and operate a the Martinka coal based rare earth element mine in West Virginia.

According to Mike Luther, Chief Executive Officer of BAMM, “Over the past 24 months, we studied rare earth element bodies around the world. We decided that coal based rare earth is the best strategic option for our company. The Martinka mine has a massive resource body; it was originally a 5,957 acre underground coal mine. There is a tremendous amount of rare earth bearing waste material, including overburden. Martinka “produces” a continuous supply of rare earth elements in the acid laced water that flows through rich coal and waste material. There is also a substantial amount of rare earth material in the 12 sediment ponds on the property. In effect, the Martinka mine is like a “natural machine” that produces a steady flow of rare earth elements. The Martinka mine rare earth elements were first characterized as part of an early study undertake by the US Department of Energy National Energy Technology Laboratory. As I recall, the Martinka mine was number 2 on the list in relation to rare earth elements.”

Luther added, “The Martinka mine is located in close proximity to West Virginia University. Neither BAMM nor Martinka has a relationship with West Virginia University. We believe that West Virginia University has the leading research and technology associated with the extraction of rare earth elements from coal. At present, the treatment and reclamation cost for Martinka runs about $1 million per year. The appeal of Martinka is the fact that the rare earth elements are hosted in water and sediment. There is no requirement for hard rock mining. BAMM is actively evaluating additional coal-based rare earth mines in West Virginia, other parts of Applachia and around the USA. The key to making the commercial economics work is scale. Uniquely, a good portion of the coal-based rare earth elements are low in uranium and thorium. Moreover, the “American” rare earths lack the complexity featured in the Australian rare earth feedstock that is giving Lynas so much trouble. Truly, American coal-based rare earth feedstock would solve the “Lynas problem” in Malaysia. Our group is in discussions with a number of parties about potential. In the near-to-intermediate-term, our goal is wok work with technical experts in the USA to establish an on-site concentrate concentration system at Martinka. From there, we will look to hand off the rare earth concentrate to a Chinese processor. We have discussed potential opportunities with Shenghe Resources and China Minmetals, among others. In the near-term, there is no reasonable separation option other than China. Based upon our discussions, there is a tenable and highly attractive global solution to the rare earth dilemma by working with China. We will provide more comments about this in the future. One last point, is worth noting involves the fact that coal-based rare earth elements are “clean” and serve to clean up mine sites. We are excited about how new technology demand for rare earth elements could help fund the cleanup and closure of existing coal mines in the USA. This is highly complimentary to the Bloomberg effort to address the coal mine problem in America.”

Benjamin Spiegel, notable merchant banker and investor from Redwood Capital is an early player in the coal-based rare earth elements sector. Spiegel has a distinguished track record as a investor in mining, industrials and real estate. We understand that Benjamin Spiegel is deeply interested in the coal-based rare earth sector.

The Martinka Coal Company’s Tygart River Mine was a subsidiary of Peabody Energy. The mine site is located six miles southeast of Fairmont, West Virginia in the community of Powell. The mine began operation in March 1974 and ran continuously until December 1995. The underground mine area encompassed 5957 acres and consisted of 10 continuous miner units and 2 longwall units.

Reject from mining the Lower Kittanning coal seam was disposed of in three coal refuse areas that were developed, which totaled 220 acres of combined refuse fill. All water generated from these refuse areas was collected and pumped to a central treatment plant where hydrated lime was added to adjust the pH and convert the iron. A flocculent was then added to increase the settling rate of the precipitated iron. The clarified water was sent to a final polishing pond before discharging into the Tygart River. The underground mine water was collected underground and then pumped to the surface via three vertical pumps to the Guyses Run Treatment facility. The underground mine water was of sufficient quality that it required no chemical treatment. This water was sent directly through two polishing ponds and then discharged into Guyses Run, which then flowed into the Tygart River. The pH of the mine water prior to its shut down was 7.8 and the iron at the discharge point was 0.23ppm.

This story is developing and more details will follow. Among other things, we are keen to see the rare earth composition based upon testing at the Martinka site. Mike Luther indicated that BAMM will be releasing information soon.

US Battery Installs to Accelerate Beyond 2020; New Risks Emerge


Felix Maire Roman Kramarchuk

Jul. 30 2019 — Almost 10 GW of utility-scale and grid-connected battery storage will be operating in the U.S. by 2023, S&P Global Platts Analytics forecast in its latest U.S. Power Storage Outlook.

A combination of dropping costs and diversification of use cases points to accelerating storage uptake, with annual storage investments set to increase tenfold from under $0.3 billion in 2019 to around $3 billion in 2023. However, new policy and technology risks are emerging.

Battery capacity and projects in ISO connection queues

Click here for full-size chart

State policies will remain instrumental to this multi-GW deployment in the coming years. In 2018, New Jersey, Massachusetts and New York joined California and Oregon in enacting state-level storage targets. New Jersey and New York now have the two most ambitious targets: 2 GW by 2030 and 3 GW by 2030, respectively.

However, even states without dedicated policies are seeing increasing interest from storage developers. Utility-scale battery capacity in regional transmission organization (RTO) and independent system operator (ISO) interconnection queues as of May 2019 almost tripled levels seen in June 2018, reaching over 40 GW of capacity, though the fate of many of these projects is less than certain.

The largest capacity increase was in California, supported by storage mandates, and in ERCOT (a market area that covers Texas) where generation margins are at record low.

The New York battery storage market is warming up, supported by a $350 million incentive program from the New York State Energy Research and Development Authority(NYSERDA) finalized in June that will support both large-scale and small-scale installations. Several developers have this year entered the interconnection queue for NYISO, which covers New York State, positioning themselves for future RFPs.

Large number of developers eyeing NY market

Just in May, an additional 1 GW of utility-scale battery storage joined the ISO queue, with 75% located in downstate New York, after the April publication of the draft NYSERDA incentive program. In addition, ConEdison in New York launched on July 15 its RFP for 300 MW of bulk storage dispatch rights contracts.

At the federal level, storage is seeing support with the introduction of bipartisan bills in the Senate and House to add standalone storage to the list of ITC-eligible technologies. In addition, Senator Collins Heinrich introduced the Better Energy Storage Technology (BEST) Act to accelerate storage cost reduction with $280M funding following the Department of Energy’s solar PV SunShot model.

The use-cases for battery storage are starting to diversify. Early installations mostly provided frequency regulations, for example in the PJM and CAISO markets, situated on the east and west coast, respectively. However, newer installations are coming with longer storage duration. These will layer on multiple revenue streams as no single service – be it provision of capacity, energy arbitrage, spinning reserve – provides sufficient revenues to break even. The provision of peaking capacity with time-shifting solar PV generation is likely to become a key storage usage, particularly in the southwest and southeast regions.

The scale of projects and procurements is also increasing. APS announced a plan to install 850 MW by 2025, Florida Power and Light a 409 MW co-located with solar PV, and NV energy announced 1.2 GW of new solar PV and battery storage.

Lithium-ion has eclipsed all other technologies in terms of new deployments. Platts Analytics expects the technology will continue to lead in the short- to medium-term. Prices have plummeted in the past years as manufacturing capacity increased, driven by the expectation of a rapid electric vehicle uptake.

However, raw material prices, fire protection and potential import tariffs are some of the key risks to future price reductions identified in the report. Lithium supply will have to ramp up quickly in the coming years to respond to booming electric vehicle and stationary storage battery demand.

Safety concerns have increased with the fire at an APS facility in April, and the 23 recent fires at battery facilities in South Korea, which saw exponential growth in battery storage in 2018.

Meanwhile, rising tensions between the US and China opened the door to a 25% tariff on battery imports from China, though US President Trump and Chinese President Xi Jinping agreed at the G-20 summit to hold off on new tariffs and to proceed with trade negotiations.

Rare Earths Filtered From Phosphate Mine Waste

In recent tests US start-up Precision Periodic, which has developed a mining filtration system, extracted 80% of the total rare earths from phosphate mine waste in a five-minute, single pass

Rare earths filtered from phosphate mine waste
Precision Periodic conducted rare earth extraction projects for Florida Industrial and Phosphate Research

The project for the Florida Industrial and Phosphate Research Institute had the aim of capturing, extracting and separating rare earth elements (REE) out of both phosphoric acid and the resulting waste.

Precision Periodic, which is a University of Central Florida incubator company, has developed a proprietary nano-filter for extracting and releasing multiple REEs, precious metals, heavy metals and/or radioactive elements out of acidic liquids. It is both reusable and scalable for different size applications.

With the Thor nano-filtration system, the test team was able to capture 40-60% of the REEs and radioactive elements in a five-minute, single pass-through from wet process phosphoric acid, and 80% of the REEs in a five-minute, single pass-through from sulphuric acid leached waste.

“The successful test projects proved that the Thor nano-filtration technology could be a game-changer for US production of its own rare earth elements supply,” said Brian J Andrew, CEO of Precision Periodic.

“The phosphoric acid contains 150ppm of total rare earths. Based on our extraction capabilities, we could extract 75 grammes of total rare earths out of every 1,000 litres of phosphoric acid from a phosphate mine.

“This equates to one Florida phosphate mine being able to produce 230 metric tonnes of total rare earths per year, which would supply an estimated 25% of the annual US Military needs.”

Florida Industrial and Phosphate Research Institute provided two different source liquids for the test projects. The first was the wet process phosphoric acid, which contained radioactive elements, and the second being a sulphuric acid leach liquid of the sludge waste. The Thor nano-filtration system captured 45-55% of the radioactive elements, which exceeded the goal to establish the waste as viable for other uses.

The REE filter is currently available for partnership projects.

US and Australia team up against China’s dominance in rare earths

Japan also joins bid to lessen Beijing’s ability to wield minerals in disputes

Lynas’ rare earth mine at Mount Weld, Western Australia: These minerals are not as rare as advertised, but China has a near monopoly on processing and refining them. 

SYDNEY — An Australian rare-earth producer has enlisted an American partner to help it chip away at China’s dominance in supplying minerals that are crucial to making smartphones, missiles, batteries for electric vehicles and a long list of high-tech products.

Lynas, the world’s only major rare-earth producer outside China, has signed a deal with Texas-based Blue Line to set up a separation facility in the U.S. Operations could begin in 2021.

“In fact, the only heavy rare earth separating plants in the world are located in China,” Lynas CEO Amanda Lacaze said in an interview with Nikkei. “But heavy rare earths are essential.”

Japan is also expanding its cooperation with Lynas, thus creating a three-nation alliance in the sector that parallels the Asia-Pacific region’s security landscape, where the U.S., Japan and Australia are allied to confront China’s military expansion, an industry source noted.

China has used its rare-earth dominance as a weapon in previous trade disputes and has signaled that it could do so again in its current fight with the U.S

Rare earths, a group of 17 vital elements, are actually not so rare; they have been discovered in various parts of the world other than China, including Australia and Brazil. Mining operations do not pose a big problem, but this does not hold true for the processing needed to produce purified rare earth materials.

Chinese players account for 85% of the global production of high-purity rare-earth elements; Lynas produces the remaining 15%.

While Chinese companies carry out both the upstream and downstream processing in China, Lynas has been mining rare earths in Australia but processing them in Malaysia because of concerns about the radioactive waste that the process generates.

Lynas in May decided to alter this arrangement and teamed up with Blue Line to build a separation plant in the U.S. Unlike the company’s plant in Malaysia, the Texas facility will be able to separate dysprosium, an element essential in the production of batteries for electric vehicles.

Dysprosium is especially difficult to extract, and its production has been left to Chinese companies. Lynas’ move to build a separation facility in the U.S. will alter the global playing field.

The possibility of China blocking supplies of rare earths to the U.S. has prompted President Donald Trump and his administration to start expanding the country’s cooperation with Australia.

The Oceania country was among the first to follow the U.S. lead and bar Huawei Technologies from providing equipment for fifth-generation wireless communications due to security concerns.

Now Washington and Canberra are closing ranks over rare earths and other key minerals. In December, the U.S. Geological Survey and Geoscience Australia signed a preliminary deal to support joint research and development of minerals deemed critical to the U.S. economy.

Lynas’ strategic move is clearly in line with Canberra’s strategy concerning economically critical minerals.

China once tried to acquire Lynas. In 2009, state-owned China Nonferrous Metal Mining sought to purchase a majority stake in the Australian company, an attempt foiled by the Australian government.

Meanwhile, Lynas has been beefing up its relations with Japan as well. In 2010, supplies of Chinese rare earths to Japan came to a halt after Tokyo nationalized the Senkaku Islands, Okinawa Prefecture, angering China, which also claims the islands.

Hard-pressed for the vital minerals, Japan turned to Lynas. In 2011, Japanese trading house Sojitz and the Japan Oil, Gas and Metals National Corporation provided $250 million in capital and lending to help Lynas boost production. The Australian company promised to supply rare earths to Japan in a stable manner.

Lynas now supplies 30% of Japan’s rare earths, and Japan is Lynas’ largest customer.

It racked up roughly $260 million in sales in the year to the end of June 2018.

Lynas’ Texas plant will not begin operating until 2021, which means China will be able to use its dominance of the sector to strike back against Trump’s tariffs and moves to deprive Chinese companies of the technology they need to survive.

Since May, when Chinese President Xi Jinping made an inspection tour of a key rare-earth production center, prices of dysprosium and other key rare-earth elements have climbed.

“China is using its dominance in rare earths to effectively pressure the world’s major consumers,” said Hikaru Hiranuma, a research fellow at the Tokyo Foundation for Policy Research.

For decades, China has been tightening its grip on the global rare earth market. It has received help from major consumer countries with rare earth mines. These countries send ores mined at home to separation facilities in China that can purify the materials for industrial use.

Since China has been one of the few countries willing to tolerate the industry’s radioactive and environmental hazards, it has come to dominate refining and transforming rare-earth ores into valuable metals, magnetic powders and other high-value products. As a result, Beijing has gained a weapon in its trade battle with the U.S.

In a related move, Northern Minerals, another Australian company involved in rare earths, is considering a change in its traditional approach of exporting its rare-earth ores to China for processing. It is now weighing a plan to build a new separation plant in Australia.

Blue Line Corp. CEO Jon Blumenthal on the impact of U.S. trade tensions with China on the rare earth market.

The cooperative would be exempt from antitrust laws in an attempt to protect it from mass government-backed production in China, according to the Wall Street Journal. Although it would be privately funded, Secretary of Commerce Wilbur Ross would need to secure a charter for the business, the Journal reported.

Truth or Consequences: Trump Has Exaggerated the Threat of China’s Monopoly on Rare Earths

Originally published on, the story below characterizes the “Trump China Rare Earth Threat” as something inconvenient in contrast to a full supply interruption (tantamount to a national security fiasco). The Editor of disagrees with the contention of the story. The argument in the narrative below is that China export reductions would lead to production increases in Japan. There is one problem with the Japan processing alternative. It simply does not exist. To our knowledge, there is no rare earth processing in the country of Japan. If any reader has a different understanding, we would be grateful for the facts. In the meantime, take a look at the story below. The USA-China trade war is a real dilemma with tantalizing possibilities, none of which look promising for America. Benjamin Spiegel, Senior Associate at Redwood Capital is concerned about the intermediate-term supply chain disruption that might occur if China reduces or stops exports.

According to Spiegel, “Redwood Capital is deploying capital in the rare earth sector. We are particularly interested in NdPr. All one has to do is look at the EV production plan for major automotive companies over the next few years. There is not enough NdPr available in the supply chain to support global EV production that has been announced. If the USA antagonizes China and global NdPr supplies get tight, permanent magnets will be in short supply and that means EV’s will not get motors….the supply chain vulnerability is very real. If Lynas can sort out the uranium and radium challenges, we like the Company as an alternative to China. In fact, Lynas is the de facto production for Japan given the Company origins and effective control levied by Sojitz and Japan Oil, Gas and Metals National Corporation (Lynas lenders).

We understand that Spiegel is also bullish on Neo Performance Materials, a company that has rare earth processing facilities in Estonia.

The Editors Monday, July 8, 2019

As its trade war with the United States goes on, China in recent months has raised the possibility of weaponizing its control over 80 percent of the world’s supply of rare earths, minerals that are used in a wide array of important industrial and consumer products. In response, Washington wants to partner with other countries to help develop their mineral reserves to diversify the global supply chain, and even boost its own domestic supplies. But while that may sound sensible on paper, it is based on an unrealistic portrayal of the threat posed by China’s near-monopoly supply of rare earths, says Eugene Gholz, an associate professor at the University of Notre Dame with expertise in industrial supply chains. WPR recently spoke with him about the reality of the global market for rare earths, and why the Trump administration may have other reasons for exaggerating the threat posed by China. The following transcript has been lightly edited for length and clarity.

WPR: How is it that China came to control such a large share of the world’s supply of rare earths? Was it geological good fortune, or were there other factors at play?

Gholz: Definitely not purely geological. The observation that rare earths aren’t actually that rare—they’re about as common as copper or lead in the earth’s crust—is very commonplace now. But it’s actually not that helpful, because in most places, rare earths don’t appear in concentrated form. They’re very diffuse. But there are still commercial concentrations in a lot of countries besides China; Australia and the United States are the major ones that are currently commercially producing rare earths.

China wound up as the near-monopoly supplier 10 years ago. It has much less of a monopoly today than it did then, but it ended up that way due to a number of issues, the most important of which is that rare earths are often found with other materials when you mine them. So, the largest rare earth mine in the world, in China, is really an iron ore mine that produces iron ore in large quantities and has rare earths as byproducts. Most of the fixed costs are absorbed by the iron ore operation, which makes it a quite low-cost place to produce rare earths on the side.

It’s not a hard mining operation. The challenge is the purification chemistry—the next step in the supply chain—with a lot of protected intellectual property and trade secrets. Having the exact chemistry for a particular deposit, to get very high-purity rare earths out of it, takes a lot of effort. That leads to a few countries being good at this, and that has to match up with a good supply of the material. Lately, that’s been in China, but there’s lots of expertise in processing elsewhere.

WPR: So, what would actually happen if China followed through on its threats of export controls? What kinds of disruptions might we see?

Gholz: I think we’d see an annoyance more than anything else. In part, it would depend on the details of what China did. If it tried to do something very narrow and targeted, like cut off rare earths exports to the U.S., it would have very minor effects. The biggest use of rare earths materials that are directly imported to the U.S. is actually in oil refining. It’s just used to make the refining process a little more efficient. In the past, when the price of rare earths has gone up, oil refiners have said, “We’re just not going to use this particular refining additive until the price goes back down.”

If the Chinese government wanted to squeeze the most high-profile rare earth products, it would presumably try to restrict, say, rare earths magnet exports to the U.S., because the magnets are what goes next into the supply chain for electric vehicles, wind turbines, aircraft and missile actuators, radar emitters—a whole series of things. The challenge to China is if it is trying to focus its export disruption on the U.S., other countries, notably Japan, make rare earths magnets and could expand their production. So, if China stopped exporting rare earths magnets to the U.S., rare earth elements would find their way to Japan and Japanese companies would turn those rare earths into magnets and sell them to American companies. So, it’s difficult for China to make a concentrated disruption.

WPR: Based on what you’re saying, are U.S. efforts to boost domestic production of rare earths and diversify its suppliers based on an exaggerated sense of the threat that China poses in this regard?

Gholz: I certainly think it is based on an exaggerated sense of the threat. I think there’s a lot of alarmism and a lack of confidence in markets, businesses and entrepreneurs to deal with any move by China. It’s based on the idea that government understands things better than individual people seeking profit opportunities, and it comes from a protectionist mindset. There’s talk about the government investing meaningful subsidies in various stages of the supply chain for rare earths in the U.S. and talk about regulatory changes. There are a number of other initiatives, like relaxing permitting requirements or changing rules for mining rare earths on public land—those are very much in the conversation.

A lot of this is based on the belief that the constraint is on the material coming out of the ground. I think that’s generally a misreading of the industry. There’s been a mineral glut in past years, and the reason there aren’t more mines is that opening more mines wouldn’t have been profitable. If China disrupts exports in some way, and suddenly there’s unmet demand and prices go up, other mines would be profitable. There are other mines that are already permitted and ready to go, or existing non-Chinese mines could expand their production. But there are political interests who are committed to reducing regulations, and they see an opportunity linked to fears about rare earths. Even if it’s not actually going to solve the rare earths issue, it’s part of a broader campaign to deregulate.

WPR: Are there other things going on here that bear mentioning?

Gholz: There’s also an initiative within the Trump administration to use Title III of the Defense Production Act to subsidize capacity expansion for producing [rare earth] magnets. It’s a law on the books in the U.S. that allows the government to invest in creating or expanding production capacity for national security reasons. The companies that are actively producing in the industry have tended to be very cautious about this kind of government investment, because they’re sensitive to the possibility of creating a glut and going out of business if too much production capacity is created. They’re afraid the government is going to put them out of business—that by thinking that it is expanding capacity, the government is actually going to destroy existing capacity.

This fits a pattern in which the Trump administration seems inclined to use government action in trade, whether it’s tariffs or subsidies. To do that without passing new legislation, they need to trigger language in existing law that refers to national security. So, the more that the administration can create a situation where there’s at least a fig leaf—if not public agreement—that there’s a national security issue, the more leeway they have to use existing laws to implement protectionist policies. If you scratch the surface one level deeper, there’s a reason why the administration talks about rare earths as a potential national security vulnerability. Independent of whether it actually is a vulnerability, it’s part of creating the idea that, for national security reasons, the government should take some action through subsidies.


America Get Serious About Coal-Based Rare Earth Elements: DOE Seeks Proposals For “Scaling Up” Processes To Improve REE and CM Recovery From Coal Resources

The U.S. Department of Energy’s (DOE) Office of Fossil Energy (FE) has issued a notice of intent (NOI) for a funding opportunity announcement (FOA) focused on recovering rare earth elements (REE) and critical materials (CM) from domestic coal resources, using novel and conventional extraction, separation and recovery processes.

DE-FOA-0002003, process scale-up and optimisation/efficiency improvements for REE and CM recovery from coal-based resources, will support FE’s Rare Earth Elements programme. The National Energy Technology Laboratory (NETL) will manage these projects. It is anticipated that the FOA will target two areas of interest (AOIs).

Firstly, the production of REEs and CMs – transitioning and scale-up of novel extraction/separation concept development into bench-scale facility REE/CM production. Specifically, this AOI will focus on further development or scale-up of novel REE and CM extraction and separation concepts, leading to production of REEs and CMs in bench-scale facilities.

Secondly, production of REEs and CMs – transitioning and scale-up of conventional extraction/separation processes from bench-scale to pilot-scale facility REE/CM production. Specifically, this AOI will focus on further development or scale-up of bench-scale, conventional REE recovery processes, leading to the production of REEs and CMs in pilot-scale facilities.

The FOA is anticipated to be issued the second quarter of fiscal year 2019. Prospective applicants to the FOA should begin considering developing partnerships, formulating ideas, and gathering data in anticipation of its issuance. No applications will be accepted through the NOI, and all the information it contains is subject to change.

Luxfer Holdings PLC to Acquire Neo Performance Materials Creating Billion Dollar Global REEs/Metals Business

Former Molycorp Subsidiary Brings Oaktree and Other Major Institutional Investors Into Global Rare Earth Marketplace

Luxfer Holdings PLC (NYSE: LXFR) (“Luxfer”) and Neo Performance Materials Inc. (TSX: NEO) (“Neo Performance Materials” or “Neo”) today announced the signing of a definitive agreement under which Luxfer would acquire Neo Performance Materials for US$612 million* in cash and stock. The transaction accelerates Luxfer’s strategy to become a leading global manufacturer of highly-engineered advanced materials for high end applications. Completion of the transaction, which was unanimously approved by each company’s Board of Directors, is subject to shareholder approval for each company and customary regulatory clearances and closing conditions.

Headquartered in Toronto, with corporate offices in Colorado and Beijing, Neo Performance Materials is a global leader in the innovation and manufacturing of rare earth and rare metal-based functional materials used in many of today’s advanced technologies. Neo has reported sales of US$454 million and Adjusted EBITDA of US$69 million for the twelve months ended September 30, 2018. Neo’s operating model has generated high free cash flow conversion with strong margins and low capital expenditures. In addition, there is significant additional capacity within their nine manufacturing facilities to support growth.

Transaction Rationale

The acquisition of Neo accomplishes several strategic goals toward enhancing shareholder value. The addition of Neo:

“Neo Performance Materials significantly enhances our global leadership in the innovation and manufacturing of rare earth and rare metal-based functional materials, which are essential inputs to high-growth, future-facing industries,” stated Alok Maskara, Chief Executive Officer of Luxfer. “Neo’s Magnequench segment is an industry leader in rare-earth powders used to manufacture magnets for performance micro motors and other critical applications, while the Chemicals and Oxides segment complements Luxfer’s own zirconium-based chemicals business. We warmly welcome Neo Performance Materials’ skilled employees and leadership and look forward to establishing a common high-performance culture focused on meeting the needs of our customers.”

Geoff Bedford, Chief Executive Officer of Neo Performance Materials, said, “The combination of Luxfer and Neo creates a global leader of highly-engineered advanced materials which are critical to many of today’s macro global trends including those promoting energy efficiency and environmental sustainability. Luxfer’s strategy is complementary to Neo’s in that we both have focused on deep customer relationships, strong product development capabilities, cost-competitive manufacturing and global reach, which has allowed us to uniquely position ourselves in our respective markets. This combination will enable our businesses to reach the next level as an important part of a larger, more diversified company. We look forward to this transaction and believe our employees, partners, shareholders and customers around the world will benefit greatly as a result.”

Transaction Details and Synergies

The transaction will be effected via a Plan of Arrangement pursuant to section 182 of Business Corporation Act (Ontario). Upon completion of the transaction, shareholders of Neo Performance Materials will receive US$5.98 in cash and 0.395 Luxfer shares for each common share of Neo Performance Materials. Post transaction, current Luxfer shareholders will own approximately 63% of the combined company on a pro forma basis.

Luxfer has arranged US$375 million in committed financing in a syndicated term loan B to fund the cash portion of the purchase price, fees and expenses, and refinance existing debt.

The transaction is expected to realize at least US$15 million of cost synergies, largely from the elimination of duplicative public company costs and sourcing benefits from vertical integration of rare earths. In addition, integration of Luxfer’s zirconium chemicals business with Neo’s Chemicals and Oxides unit is expected to lead to growth synergies.

The two largest shareholders of Neo, which are affiliates of Oaktree Capital Management, L.P., have entered into a voting and support agreement for the transaction, which includes an agreement to sign a lock-up for the newly issued Luxfer shares upon closing. Members of the Boards of Directors of Luxfer and Neo have also entered into voting support agreements for the transaction. At close of the transaction, Oaktree will own approximately 24% of Luxfer ordinary shares outstanding. Upon closing, it is anticipated that some members of the current Neo Board of Directors will join Luxfer’s Board.

The transaction is expected to be completed during the second quarter of 2019, following regulatory clearances, shareholder approvals and satisfaction of closing conditions.

Pro forma Financial Performance

On a pro forma basis, the combined entity had US$947M million in revenue and Adjusted EBITDA of US$148 million on a trailing twelve-month basis. Also, the combined company will continue to benefit from a strong balance sheet, with modest pro forma net leverage of approximately 2.0x.

Luxfer will provide forward-looking guidance for the combined company upon closing of the transaction and expects to maintain its target of 8-10% increases in EBITDA annually through continued internal performance improvements, deal-related synergies and revenue growth.

Jefferies Group LLC acted as exclusive financial advisor to Luxfer, while Barclays Capital Canada Inc. acted as financial advisor to Neo.

Global 17 Plans 2019 Launch For Will Scarlet Rare Earth Mine

The Will Scarlet mine contains the largest known AMD deposit of coal-based rare earth elements (REEs) in the USA. Drilling of the 14 acre Will Scarlet REEs precipitate pond was completed in May 2018. Drilling conducted by mining professionals with the assistance of staff under the direction of Rick Honaker at University of Kentucky. Material testing is presently underway at the University of Kentucky.

After developing some of the most successful coal mining businesses in North America, Jason McCoy is putting the finishing touches on a business plan for Global 17’s wholly-owned Will Scarlet rare earth mine. McCoy and his management team hired University of Kentucky to assist with drilling and sample testing in the Spring of 2018. Preliminary results were encouraging enough to subject the samples to testing at SGS SA laboratories. At this juncture, Global 17 has drilled out less than 1% of the 3,000 acre Will Scarlet mine resource. Although the results are subject to further review, preliminary numbers suggest this small portion of Global 17’s Will Scarlet mine holds $300 million of rare earth and critical minerals. By extrapolation, the Global 17 may be sitting on a mother lode holding $2 to $3 billion of rare earth elements. Sources indicate that the Will Scarlet Mine could prove to be one of the largest rare earth element mines in the USA.

The Will Scarlet REEs deposit is particularly attractive due to the fact that most of the REEs are suspended in a precipitate.

Particularly interesting is the fact that Global 17’s Will Scarlet Mine is a coal-based rare earth mine. A large portion of the rare earth element bearing feedstock is a sludge-like material that formed during the acid mine drainage process. This precipitate type of material is rich with rare earth elements. Notably, the material does not require blasting or crushing. The Will Scarlet feedstock is “process ready”. According Gregory Inggs, Global 17’s head of international sales, the Will Scarlet feedstock is rich with both light and heavy REEs. Inggs added “There is a tremendous amount of interest in the Will Scarlet REEs from domestic and international sources. This summer, we hosted a Chinese delegation for a mine tour with favorable results. As word spread about Will Scarlet, more inquiries arose. Another major Chinese rare earth producer requested that we send samples. At this point, we are working on production of samples for evaluation by REEs companies who want to bid for product.

According to Jason McCoy, “Despite interest arising from rare earth element producers in China, Australia and other parts of the world, Global 17 wants to find a way that a large percentage of Will Scarlet rare earth elements stay in the USA. Global 17 has reached out to existing rare earth producers, including MP Materials about the idea of processing. We are examining a number of alternatives, including some advanced technology at leading universities in the USA. We are quite keen to complete work on the flow sheet, develop the engineering plan and undertake construction of our pilot plant during the 2019-2020 period.”

It sounds like Global 17 has some exciting plans.

Fundamental shifts for rare earths following an electrified automotive industry

BMW i3 charging. Author: Kārlis Dambrāns.

December 10 (Renewables Now) – Global consumption of rare earths is expected to exceed 130 kt in 2018, according to a new report by metals and minerals market research company Roskill.

The rare earth elements (REEs) represent a suite of 15 elements known as the lanthanides and include yttrium, which are naturally concentrated together during geological processes and are inherently extracted as a package. Rare earths are used in a variety of high-tech and advanced material applications, typically offering increased efficiency and performance compared to alternatives.

Lanthanum-based nickel-metal-hydride (NiMH) batteries and neodymium-iron-boron (NdFeB) permanent magnets have both experienced double-digit growth in recent years related to demand from the new energy sector, especially the uptake of electric, plug-in hybrid and hybrid electric vehicles (EVs, PHEVs & HEVs: collectively xEVs).

The growing demand for NdFeB magnets in wind turbines and xEV drivetrains has made magnets the leading rare earth application ahead of catalysts (lanthanum-based fluid catalytic cracking and cerium-based auto catalysts) as of 2016. Roskill estimates magnets to account for over 25% of demand in 2018, while catalysts have fallen below the 25% mark in 2017. Batteries have seen the highest growth-rate in 2018 and account for just less than 10% of rare earth demand but are facing growing replacement by lithium-ion batteries, which is suppressing their growth potential.

Neodymium has been crowned king

The electrification of the automotive industry is redefining the fundamental supply and demand balances of rare earths. Because of the improved efficiency in converting battery energy into torque, rare earth magnets have become the formulation of choice in this generation of xEVs. An increase in the consumption of high-efficiency magnets used in the drivetrain of xEVs will underpin strong growth in rare earths over the next decade.

Neodymium and praseodymium (NdPr) are the key rare earths used in NdFeB magnets and a growing demand will shift the natural imbalance of rare earths further away from the high-volume supplied lanthanum and cerium. Roskill estimates the neodymium supply and demand balance to have moved into equilibrium as of 2017 and neodymium is forecast to remain in a tight market throughout the next decade as the global supply-side looks to keep up with xEV growth. There are, however, efforts globally to relieve the high-surplus lanthanum and cerium imbalance by substituting these for a portion of the neodymium composition in lower quality magnet applications.

All roads lead to China

Rare earth supply is dominated by China, producing around 80% in 2018. Lynas in Australia is the second largest producer of rare earths and the leading producer outside of China, having joined the supply chain in 2013 at a time when China accounted for over 95% of global production. Rare earths from Lynas may have offered a source for raw materials that circumvented China, but the Chinese have also invested heavily in developing its downstream processing and manufacturing industry.

Much of the rare earth magnet manufacturing capacity has moved to China, with only a handful of producers remaining elsewhere. As a result, new rare earth producers Rainbow Rare Earths and Northern Minerals already joining the supply chain in 2018 and those projects advancing are all looking to China for off-take partners.

In September 2018, the US backpedalled rare earths out of the finalised trade tariff list on Chinese imports, realising the reliance on Chinese processing, refining and manufacturing capacity for rare earths and its products. Unless there is an investment in downstream production capacity, much of the new rare earth production entering the market will most likely be processed in China.

Lynas Corp To Idle Malaysian Rare Earth Facility Amid Continued Government Inquiries

Lynas Corp is planning to temporarily shutdown production at its rare earths plant in Malaysia after failing to secure regulatory approval to increase annual production levels from local authorities. This latest regulatory hurdle occurs just as a Malaysian parliamentary committee is due to release a high profile report on the Australian-listed miners’ radioactive waste management practices and its impact on the environment. Lynas said on Tuesday the temporary shutdown and associated activities would potentially reduce productions volume of NdPr, a substance widely used in the electronics industry, by about 400 tonnes. It said the calendar year limit on the volume of material that Lynas can process in Malaysia would be reset on January 1, enabling production to resume.  Amanda Lacaze, Lynas chief executive, told shareholders at the company’s annual meeting in Sydney that 400 tonnes of NdPr was worth about A$16m in terms of gross revenues. “As it is now late November, and we have not received that approval, we are prudently planning for a temporary shutdown of production in December,” she said.  Shares in Lynas fell by 2 per cent to A$2 in early morning trading on the ASX.  The Lynas plant in Kuantan is one of the few suppliers of processed rare earths outside of China, serving customers in Japan, Europe and North America. Rare earths, a group of 17 elements, are widely used by the electronics and oil and gas industries.  Dylan Kelly, analyst at CLSA, said the bigger issue for Lynas was the pending release of the Malaysian parliament’s report, which has raised fears that Lynas could face new regulatory hurdles in Malaysia. The parliamentary committee which has drawn up the report is expected to hand it to Malaysia’s minister for the environment later today. Lynas has been the subject of complaints by some local people and environmental activists since it opened its plant in 2012.  Mr Kelly said he expected the report would make few adverse findings against the company, based on a resoundingly favourable public hearing attended by Lynas executives on November 11th.  “In our view we see this event as a positive catalyst for the stock as it clears the ire of political risk and achieves a larger public relations win in espousing their environmental record,” he said.

European Commission Report: Raw Materials ‘Megatrends’ Point to Looming Global Supply Risks

“A smartphone might contain up to 50 different metals” all of which provide essential properties to the final product, the European Commission said in its latest Report on Critical Raw Materials and the Circular Economy, published in January 2018. [Shutterstock]

This article is part of our special report The global race for raw materials.

Markets for raw materials have recovered from the 2008 financial crash, fuelled by the continued digital transformation of the economy and the rapid deployment of green technologies. Is the world on track for a repeat of the resource boom seen in the early 21st century?

The global fight for natural resources was nearing an all-time high when the European Commission
first laid out an EU strategy for raw materials, back in 2008.

“A strong and unforeseen surge in demand” driven essentially by double-digit growth in China, had led to a tripling of metal prices between 2002 and 2008, the Commission said at the time.

China, the world’s de facto sole supplier of rare earth metals, took advantage of its monopolistic position to impose restrictions on exports, prompting Japan to start stockpiling in fear of a supply crunch.

At the European level, those concerns resulted in the establishment of a “raw materials diplomacy” to secure supplies from abroad – including legal action at the WTO when necessary – a push for resource-efficiency inside Europe, and the creation of a list of critical raw materials to monitor potential supply risks.

Those fears were quickly swept away by the financial crisis, which depressed the global economy for many years.

But ten years later, the fundamental economic trends that fuelled EU worries at the time are still there. If anything, those trends have intensified, driven by the continuous digitialisation of the economy and the transition to renewable energies.

“Irreplaceable” raw materials

“It’s already happening,” said Maroš Šefčovič, the European Commission’s vice-president for the Energy Union, when asked about fears that raw materials prices could start rising again.

“All the focus now in the European Commission is to reduce dependency on fossil fuels,” he told EURACTIV in an interview.

“This is why we are looking at access to raw materials with increased scrutiny,” he added, saying the objective was to avoid trading dependency on imported oil and gas with dependency on imported raw materials.

“I really think that, when it comes to the issue of dependency, we could end up in a situation where raw materials become the new oil,” he warned.

To illustrate his point, Šefčovič likes to produce one statistic about the materials necessary to produce a 3 megawatt wind turbine. Manufacturing one of those requires 335 tonnes of steel, 4.7 tonnes of copper, 1,200 tonnes of concrete, 3 tonnes of aluminium, 2 tonnes of rare earth elements as well as zinc, he says.

“For me that is really illustrative of the volume of raw materials you need for the green transition,” he told EURACTIV.

Critical raw materials “are irreplaceable in solar panels, wind turbines, electric vehicles, and energy- efficient lighting” which are essential for the energy transition, the European Commission said in its latest Report on Critical Raw Materials and the Circular Economy, published in January 2018.

Everyday consumer products in the telecoms sector are also highly exposed to raw materials price fluctuations. “A smartphone might contain up to 50 different metals” all of which provide essential properties to the final product, the EU executive remarked, pointing to the importance of critical raw materials for high-tech products.

And the majority of these primary raw materials are produced and supplied from non-European countries, the report pointed out:
Source: European Commission

Nowadays, industry people say supply risks are driven mainly by emerging demand for new products such as electric cars.

“Raw materials will be essential for manufacturing the products of the future. They form the basis of modern societies, our cities, digitalisation and the European energy transition,” said Roman Stiftner Secretary-General of the European Mineral Resources Confederation (EUMICON).

“Megatrends such as digitalisation and the decarbonisation of transport and production are resulting in new demand for raw materials, in terms of volume and of complexity,” EUMICON said in its raw materials charter, published earlier this year.

Other megatrends identified by EUMICON include increased wealth and global population growth. Global GDP is ten times higher than 50 years ago, and the world’s population has doubled. A further 3 billion people are expected to join the middle-class between 2010 and 2030, and all of them will want cars and smartphones.

Meanwhile, urbanisation, digitalisation, the low-carbon transition and the switch to electricity as the main source of energy for industry are further accelerating developments, it says.

“Electricity demand is rising, while increased production of wind and solar energy requires a greater quantity of a different mix of raw materials,” EUMICON pointed out, wondering whether the world has entered “a new age for metals and minerals”.

To be sure, the digital revolution that was already underway ten years ago has accelerated and branched out into new areas, creating excitement around things like robotics, smart cities, industry 4.0, electric vehicles, autonomous driving, and artificial intelligence, to name a few buzzwords.

On the manufacturing side, concepts have evolved. The European Commission’s resource- efficiency agenda of 2011 has morphed into a more ambitious circular economy strategy, which places recycling at the centre of attempts to close raw material loops and keep valuable resources inside Europe.

New risks, new solutions

However, recycling has its limits, even under the most optimistic scenarios. “The overall demand for raw materials is growing, and recycling alone cannot supply the market,” EUMICON said, citing aluminium as a case in point.

And “since recycling efforts will not be sufficient to feed the demand, supply of primary raw materials is irreplaceable,” it argues, calling for “new solutions” to establish “a future-proof raw materials policy”.

This includes exploiting Europe’s own geological deposits as well as securing access to raw materials on global markets to strengthen the future resilience of European industry.

But is Europe – and indeed the world – better equipped to deal with those global challenges today than it was ten years ago? From a technological point of view, maybe yes. But from a global trade perspective, definitely not.

Under President Trump, the United States has taken a hostile stance against Europe and China on trade, launching attacks on all fronts, ranging from steel to cars and food, raising the spectre of a new global trade war.

China itself has long pursued unilateral policies on access to raw materials, cutting deals with resource-rich African countries in return for cheap loans and infrastructure.

This makes the current trade environment more volatile than it was ten years ago, under a more accommodating Obama administration and a less assertive China.

“This time around, governments seem to be taking a more assertive, and in some cases, pre- emptive stance,” according to the Centre for European Policy Studies (CEPS), a think-tank.

“Witness, for example, China’s disputes on rare earth elements or President Trump’s Mineral Order at the end of 2017. This new attitude may pose new challenges for EU trade policy,” CEPS wrote in a policy paper published in February.

A future ‘Made in Europe’?

Faced with those challenges, Europe has also taken a more assertive stance, launching WTO disputes against Chinese export restrictions on raw materials such as graphite, cobalt, copper, lead and chromium.

In his latest State of the Union speech, Jean-Claude Juncker proposed a new ‘Africa-Europe Alliance’ that hopes to tap “the full potential of economic integration and trade,” with an objective to leverage up to €44 billion of investments into the region by 2020.

At home, the European Commission has targeted an increase in the recovery of key raw materials as part of its Circular Economy Strategy put forward in 2015, placing the emphasis on recycling and reuse with a view to “closing the loop” of product lifecycles. Supporting innovation in European recycling technologies is also part of that plan.

But EUMICON says technological solutions, although necessary, won’t go far enough to meet the challenges Europe is facing.

“A complete approach to sustainability requires us to consider economic, environmental and social sustainability together,” EUMICON said, stressing that “all three aspects need to be addressed with equal focus” in order to ensure a future that is “Made in Europe”.

What it boils down to is the importance of strengthening raw material value chains in Europe at a time when the international trade order is being challenged.

“The EU will need to develop a proper thinking how to put raw materials in the centre of its industry strategy, since we will be facing a new global race for raw materials in the future,” said Gilbert Rukschcio, managing partner at Pantarhei Advisors, a consulting firm based in Austria.

“Global megatrends such as digitalisation and the energy transition will also force Europe to act on this field,” Rukschcio said.

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Could Afghanistan Be The Key To Solving the USA Rare Earth Shortfall

Erik Prince, chairman of the Prince Group, LLC and Blackwater USA, holds up a picture showing the affect of a car bomb while testifying during a House Oversight and Government Reform Committee hearing on Capitol Hill October 2, 2007 in Washington DC. The committee is hearing testimony from officials regarding private security contracting in Iraq and Afghanistan. (Photo by Mark Wilson/Getty Images) (Getty Images)

The founder of the notorious, and now defunct, Blackwater, has been making headlines for trying to privatise the Afghan war. What has gone unreported are his plans as “Trump’s advisor” to extract the country’s immensely rich mineral wealth.

Erik Prince, the founder of the private military company Blackwater, now known as Academi, has trained his sights on mining natural resources in war-torn Afghanistan, according to multiple sources and Afghan officials.

Details from Afghan officials and conversations with two sources knowledgeable about Prince’s movements in Kabul say he is looking into opportunities to mine Afghan minerals and visited the country in early 2018 and September to explore these possibilities.

Prince, who is the chairman of logistics firm Frontier Services Group, had pitched a plan to privatise the Afghan war and mine the country’s minerals to the White House last year.

His proposal included finding rare earth minerals in some of Afghanistan’s most volatile regions, allowing the United States to source valuable lithium for batteries, along with other deposits, and provide jobs to Afghans.

Prince and his associates met key figures in the Afghan mining ministry in January 2018, an Afghan government official with knowledge of Prince’s schedule told TRT World.

Team4RMC—an Afghan security company that was assisting Prince—requested a meeting for him with Afghan Mining Minister Nargis Nehan to discuss his plans to invest in the country, and described him as a “current advisor” to President Trump.

Prince and his associates, including Frontier Services Group head in Afghanistan, Shahin Mayan, met officials at the Afghan Ministry of Mines on 13 January.

Mining Minister Nargis Nehan was out of the country, so they met a deputy minister and other officials.

Team4RMC claimed Prince was also meeting President Ashraf Ghani, Chief Executive Abdullah Abdullah and other high-level officials.

In late 2017, according to a Kabul-based source and Afghan mining expert, who wishes to remain anonymous for fear of safety and losing his job, officials from the Department of Commerce and United States Geological Survey working with the United States embassy in Kabul, visited the country to investigate ways in which minerals could be found and mined.

The Afghan mining expert tells TRT World that the Trump administration officials sought access to the resources map archive, researched by Soviet geologists in the late 1970s and 1980s and by American geologists after 2001, to determine the quality of the minerals and see samples of them.

The Soviet mineral data charts are far more extensive than the US efforts, according to an Afghan mining expert who has been researching the issue for over a decade and has documented the various local and foreign attempts to exploit the country’s resources.

This, the expert says, could be because the Soviets progressed further with their mining plans; they extracted uranium samples from Khwaja Rawash mountain in Kabul, exploited oil and gas from the country’s north in Amu Darya and coal in Baghlan province.

There’s no evidence that Prince met Ghani or Abdullah, but if he did it would be significant: the New York Times reported in March that Ghani was angry with Prince for meeting his rival Atta Mohammad Nur in Dubai in December 2017.

When I contacted Prince in June, his spokesman said that he “currently had no mining interest in Afghanistan” and denied having any company presence in Kabul.

However, the Kabul-based mining expert—with direct knowledge of the company’s operations— confirms that Frontier Services Group had established an office in the Wazir Akbar Khan area of Kabul, with Mayan leading the company in Afghanistan.

According to TRT World’s source in Kabul, Prince has so far adopted a three-pronged strategy to build trust with Afghans and convince them to work with him.

First, he is attempting to work with Chief Executive Abdullah Abdullah and his political party.

Second, he is trying to collaborate and gain the trust of tribal elders and political leaders including Atta Mohammad Nur, and make connections with ethnic groups and influential Pashtun leaders, as well as supporting political candidates in the 2019 presidential election.

Finally, he wants to introduce himself to the Afghan people through the Afghan media including a major TV interview with Kabul-based, Tolo News, in September.

Prince’s private security record shows that he thrives financially in places of insecurity.

In Afghanistan, his ability to extract resources will depend on paying off the right warlords and government officials as well as building the most brutal militias to wrestle control of minerals from insurgent groups such as the Taliban and the Islamic State (Daesh) which make huge amounts of money from illicit mining.

The US State Department, when asked for a statement on Prince’s involvement in Afghanistan, declined to comment directly about it, saying that, “Afghan mineral rights are an Afghan issue,” and suggested I speak to the Afghan Ministry of Mines with any questions.

An Afghan Ministry of Mines and Petroleum spokesperson, Abdul Qadeer Mutfi, tells TRT World, “We are currently in the process of amending our minerals law and will be open to receiving proposals that meet our needs and fit the legal framework.” He also says the Afghan government is committed to keeping an “open and accountable extractives sector”.

Another spokesperson, Bhavana Mahajan, told me that the Afghan government hadn’t yet “received anything official” from Prince about his mining plans though the Ghani government was “open to doing business and exploring partnerships.”

The Pentagon has expressed opposition to Prince’s plan to privatise the Afghan war but has made no official comment about his desire to exploit its resources.

A United States Geological Survey study in 2010 estimated that untapped Afghan minerals—including copper, iron ore, rare earth elements, aluminium, gold, silver, zinc, mercury and lithium—are worth between $1 trillion and $3 trillion. Prince’s priorities according to mining experts are lithium, gas and gold.

It is a tantalising but dangerous prospect that could ease Afghanistan’s over-reliance on foreign aid provided Afghans get to reap the benefits.

In February 2018, USAID hosted 80 private business interests in Kabul to explore Afghan resources but USAID refused to disclose who attended the event despite my repeated requests.

President Donald Trump had expressed interest in exploiting Afghanistan’s vast, largely untapped mineral wealth to offset the expenses of the long war, the longest in US history, which has cost the United States over one trillion dollars.

Trump’s interest in Afghan mining and potential economic gains increased after separate meetings last year with Ghani and Michael Silver, the CEO of American Elements, an advanced metals and chemicals production company.

Trump and Ghani agreed in September 2017 to allow US companies access to Afghanistan’s rare earth minerals. Three senior aides of Trump met Stephen A. Feinberg, the billionaire owner of the mega military contractor DynCorp International, last July to explore mining options, the New York Times reported.

Erik Prince, chairman of the Prince Group, LLC and Blackwater USA, holds up a picture showing the affect of a car bomb while testifying during a House Oversight and Government Reform Committee hearing on Capitol Hill October 2, 2007 in Washington DC. The committee is hearing testimony from officials regarding private security contracting in Iraq and Afghanistan. (Photo by Mark Wilson/Getty Images)
Erik Prince, chairman of the Prince Group, LLC and Blackwater USA, holds up a picture showing the affect of a car bomb while testifying during a House Oversight and Government Reform Committee hearing on Capitol Hill October 2, 2007 in Washington DC. The committee is hearing testimony from officials regarding private security contracting in Iraq and Afghanistan.

Trump is now pushing for direct peace talks between the Taliban and the Afghan government while encouraging US-backed, Afghan troops to withdraw from vast parts of the country.

Afghans are suspicious of any foreign companies aiming to exploit their resources. The arrival of Prince on the scene could further raise tempers in Afghanistan.

Prince is infamous in Afghanistan and elsewhere in the Muslim world because of Blackwater’s atrocious record in Iraq, Afghanistan and Pakistan. His contractors killed 17 Iraqi civilians in Baghdad in 2007 and Prince has been involved in building a mercenary army for the UAE.

Strong networks, weak alliances

Trump’s White House reportedly considered in 2017 establishing a global network of privatised spies organised by Prince and the Blackwater founder is working with the Chinese government to secure its resources in African and Asian nations.

Prince and his family have a long connection to the Republican Party, they’ve been big donors for years, and he considered a US Senate run in 2017, while his sister, Betsy DeVos, is Trump’s Education Secretary.

Prince is under scrutiny for meeting a senior Russian fund manager allied with Russian President Vladimir Putin in Seychelles in January 2016 and is accused of lying to Congress about it.

President Trump rejected Prince’s plan to privatise the Afghan war, but he has continued advocating this year for the privatisation of the Afghan conflict.

The Taliban announced that they also opposed Prince’s plans, as has the Ghani government.

The New York Times recently reported that Prince visited Kabul in September to discuss his plans to privatise the war and exploit the nation’s minerals. The story stated that Ghani had repeatedly refused to meet Prince despite repeated requests to do so. Prince was said to be building political alliances with Ghani’s opponents to secure access in Afghanistan.

Prince has urged Washington to appoint an American “viceroy” to run the war and argued that “until those plans are enacted there will not be any economic improvements for the people of Afghanistan.”

The Afghan mining industry has remained relatively small for decades due to ongoing violence, insecurity and corruption. The Taliban earns large amounts of money from illicit mining, along with the drug trade, but it benefits very few civilians.

The Kabul mining source says that the mining industry is currently valued at $1 billion annually with 25-30 commodities being extracted. Countless more commodities are in the country but exploration and extraction are minimal.

Prince and his associates are attempting to enter the Afghan resources market at a time of intense insecurity in the country. The Afghan Ministry of Mines is a notoriously corrupt government body where there is no transparency around its decisions to appoint contracts to favoured bidders.

Prince’s company is unwilling to reveal its plans publicly because mining resources in a war zone is controversial, always occurs without community consent, and inevitably worsens violence in the areas targeted for exploitation.

The Ghani government recently signed large contracts with Afghan and foreign companies in a veil of secrecy to exploit resources in some areas controlled by insurgents.

Opponents of privatising Afghanistan’s resources, such as Integrity Watch Afghanistan and international NGO Global Witness, have expressed concern that without major governance changes these contracts will only worsen violence and entrench the power of warlords.

In a joint opinion piece by the two groups in January, they wrote that the Trump administration and Ghani government risked echoing a colonial past.

“For Afghans, whose ancestors fought against imperialism just as Americans did, that is a recipe for outrage,” they said.

During my two trips to the country to investigate the resources industry, in 2012 and 2015, it was nearly impossible to find any civilians in Kabul or in the countryside who supported its growth. They all feared worsening violence if anything was extracted because of corruption, looting and the formation of militias around the mines. Ordinary Afghans are rarely consulted about mining plans in their areas and mining contracts are never transparent.

An hour from Kabul, the people living near the Aynak mine – one of the largest copper deposits in the world, which has been leased to a Chinese company – have poor education and little access to water.

During a 2015 visit, the residents of Davo village near the mine told me that they had been promised primary and high schools, new roads, electricity, and a large mosque.

“Our expectations went up, but in the end, nothing was delivered,” Mullah Mirjan, a community leader told me at the time.

Lynas Corp. Malaysia Review Day 1: What Happened Depends Upon Who You Ask

Editor’s Note: According to “pro-Lynas” reports, the Company made it through Day 1 of the Malaysia Review unscathed. According to the vocal critics, the situation is more complicated than meets the eye. In the interest of full disclosure, Global REEs Venture is publishing both sides of the story. Below is a favorable story to Lynas Corp. To learn the perspective of the critics, please see Lynas Malaysia Review Day 1, Part II. Mike Luther, MD & Editor, Global REEs Venture

Lynas unscathed by first Malaysian review hearing

Lynas boss Amanda Lacaze is increasingly confident about Malaysia's review of the company's rare earths refinery.

Lynas Corporation appears to have emerged unscathed from the first major hearing in the Malaysian government’s review of its rare earths refinery, sending its share price to a three-month high.

Malaysian media and Australian equity analysts attending Sunday’s five-hour hearing reported that numerous Malaysian government agencies endorsed Lynas’ track record of compliance with rules and regulations.

Malaysia’s Star Online publication said such endorsements were made by the nation’s Department of Environment, the Atomic Energy Licensing Board, the Malaysian Investment Development Authority and the Department of Occupational Safety and Health.

CLSA analyst Dylan Kelly said the events reinforced his opinion that the review would ultimately provide a boost to Lynas’ credibility.

“Two CLSA staffers attended the long-awaited public hearing of the government review committee into Lynas’ Malaysian facility. Overall, we found it to be positive for the company, with five government agencies attesting to a glowing performance,” he said.

“Overall, each agency gave a positive, if not a glowing review of the company and confirmed its complete compliance with strict government regulations.”

The prospect of the review sparked a 45 per cent slide in Lynas shares between May and October amid fears it would be led by parliamentarians hostile toward Lynas, which ships rare earths from Western Australia to Malaysia for processing into higher value products.

Hostile parliamentarians Wong Tack and Fuziah Salleh attended Sunday’s hearing, but neither has a leadership role on the committee, which Lynas says is now “completely comprised” of academics and scientists rather than politicians.

Lynas shares jumped 10 per cent to $2.38, their highest price since July.

Mr Kelly said he expected Lynas shares would soon test the $2.89 they were fetching in the days before the Malaysian election in May.

“We reiterate to investors this business is not at risk of closure and we expect the share price to return to pre-election highs once the committee’s report is filed on 27 November,” he said in a note.

China Pledges Bigger Quotas For Rare Earth Mining and Exports

China controls the bulk of the world's supply of rare earths, vital metals that determine the fortune of global electronic industries. Photo: Weibo via DFIC

China controls the bulk of the world’s supply of rare earths, vital metals that determine the fortune of global electronic industries. Photo: Weibo via DFIC

China stresses no intention to exploit its monopoly of strategic metals

NOVEMBER 8, 2018 5:19 PM (UTC+8)

Beijing has again sought to refute rumors about its plans to exploit its stranglehold on the global supply of rare-earth metals. It also denies any intention to slash the mining of the 17 chemically-similar elements out of its ore deposits as well as their exports to major overseas markets.

The Chinese Ministry of Industry and Information Technology has pledged that the country’s planned mining and output of  rare-earth minerals will continue to rise. It further states that global manufacturers of magnets, catalysts, alloys and electronic devices can rest assured that there would  never be any policy-driven curb on supplies.

Beijing has taken a reassuring tone after Reuters speculated last week that the country had capped its rare-earth minerals production to 45,000 tons in the second half of this year, citing data from Dutch market research firm Adamas Intelligence.

Reuters noted that the reduction was meant to ensure a fat markup for Chinese miners and exporters.

In response, Xinhua quoted the industry and information ministry as saying earlier this week that China would raise rare-earth mining quotas for 2018 from 105,000 tons to as much as 120,000 tons and the melting quota from 100,000 tons to 115,000 tons.

That said, the Xinhua report gave scant details about the remaining quotas for the rest of the year. And even where there are no restrictions on exports, government-issued permits are required in order to be able to sell such strategic metals overseas.

Rare-earth elements are hailed as the primal, base materials for virtually everything electronic in modern day manufacturing. The products dependent upon them range from microchips, hard disc drives, smartphones and other portable gadgets to LCDs and plasma screens. They are also indispensable in the making of key alloys as well as the manufacturing of fuel cells and Nickel-metal hydride batteries.

In the mid-1990s, China consolidated its control over the global rare-earth market and before long the last US mining and processing plant for rare earths closed in 2002 because it was unprofitable. Making use of its virtual monopoly, China began imposing export quotas in 2006, and during a diplomatic spat over the Senkaku Islands in 2010, China began limiting exports to Japan, a major user of rare earths for high-tech goods.

As early as in 2012, the US, EU, and Japan confronted China at the WTO about rare-earth export and production restrictions, which were dismissed by China citing environmental concerns arising from over-exploitation.

Nonetheless, a monumental discovery of a “huge rare-earth trove” under the seabed of the Japanese economic zone off the Minamitori Island, a remote Pacific island some 2,000 km southeast of Tokyo, may have the potential to turn Japan, a global dynamo in electronic research and manufacturing, from an importer of the precious metals to a self-sufficient producer capable of quenching the global demand as well.

Read more:

Japan-China relations strained over rare earths find

Discovery could smash China’s rare-earths stranglehold


University of Kentucky Commissions Pilot-Scale Plant to Extract Rare Earth Elements in Heart of Coal Country

Rare earth elements research with Rick Honaker.

LEXINGTON, Ky. (Nov. 7, 2018) — Americans use rare earth elements (REEs) every day — without knowing it. In fact, they are crucial to society. Rick Honaker, professor of mining engineering at the University of Kentucky, knows all about these fascinating elements and the modern electronics they make possible.

REEs are a series of 17 chemical elements found in the Earth’s crust. “On a periodic table, they are typically the lanthanide series, which is the horizontal row at the bottom of the periodic table, plus scandium and yttrium. All of those elements are extremely important for everyday applications,” Honaker said.

For example, europium is a color-producing phosphor used in video screens, including computer monitors and plasma TVs. Neodymium is a powerful magnet used in smartphones, televisions, lasers, rechargeable batteries and hard drives. Due to their unique chemical properties, REEs are essential components of technologies spanning a range of applications, such as communication systems, transportation, health care and national defense.

Demand for REEs has risen steadily. Worldwide, electric vehicle production is expected to grow to 30 million cars annually by 2025. “There’s about five kilograms of rare earths in every electric vehicle, and we expect electric vehicle production is going to exponentially increase, almost doubling the amount of rare earths that we produce today.”

The problem? Approximately 90 percent of the world’s REEs are currently produced and manufactured in China. Now, is the time for the U.S. to find an economically feasible solution.

That’s where Honaker comes in.

In 2017, the U.S. Department of Energy (DOE) selected Honaker’s pilot-scale project to move onto a second phase of research in an effort to recover these elements from coal and coal byproducts. The Department of Energy (DOE) invested $6 million in the project and partners contributed an additional $1.5 million over two and a half years for a total of $7.5 million.

Honaker recently launched a pilot-scale processing plant aimed at recovering REEs from coal and its byproducts in Webster County. “We’ll start off producing a concentrate mix, and we’ve been successful in the lab — in a continuous form — actually producing a 99-percent pure rare earth product. So, we’ll be doing that, but we’ll also be taking that one step further and actually producing rare earth concentrates.”

If successful, the process would provide a domestic source of REEs. You might be asking, why is Kentucky leading this endeavor? One of the largest sources of rare earth elements in the United States is the Fire Clay coal seam in Eastern Kentucky. “Since coal is a major economic source in parts of our state, providing a means of recovering an important byproduct adds economic strength and viability to the coal industries,” Honaker continued. “So, that’s why Kentucky is interested in developing this, as well as the fact that the Commonwealth is a pretty large manufacturing state.”

Honaker has no doubts they will be able to achieve recovery. So, when asked what the most challenging part of this research will be, he replied, “Economics. Trying to be able to produce it even as a byproduct, and to be economical doing it, is probably our most significant challenge.”

Overall, Honaker remains optimistic, because he has an incredible team of researchers and students behind him.

“The training opportunities that we have are tremendous, and that brings a lot of satisfaction, because that’s really what we’re here for — to educate and to develop technology. I mean, how many times do you have an opportunity, as a student, both as undergraduate and graduate, to be involved in such a meaningful project?”

Institutions and investigators involved in the project include, Josh Werner and Wencai Zhang (University of Kentucky); Roe-Hoan Yoon, Gerald Luttrell and Aaron Noble (Virginia Tech); and Qingqing Huang (West Virginia University).

The project is scheduled to be complete in March 2020. Until then, Honaker and his team will be “very busy.”

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Rare Earth Elements Pilot Plant
Rare Earth Elements Pilot Plant
Rare Earth Elements Pilot Plant
Rare Earth Elements Pilot Plant
(Left to right) Rick Honaker, a professor and chair of mining engineering, talks with Assistant Research Professor Wencai Zhang, doctoral student Alind Chandra and postdoc Honghu Tang.

UK is the University for Kentucky. At UK, we are educating more students, treating more patients with complex illnesses and conducting more research and service than at any time in our 150-year history. To read more about the UK story and how you can support continued investment in your university and the Commonwealth, go to: #uk4ky #seeblue

Rare Earth Element Supply Limbo: Malaysia Review Panel To Hold Lynas Corp. Public Hearing November 11

Published:  |  Modified:

The executive committee to review the operations of Australian mining company Lynas Corporation rare earth processing plant will be holding a public hearing session at Bukit Gambang Resort City at 9am on Nov 11.

In a statement, the Energy, Science, Technology, Environment and Climate Change Ministry said the public hearing session will be conducted to engage with all stakeholders, including Lynas Malaysia, NGOs, government agencies, environmental experts, public health experts, as well as radiation experts.

“The public is invited to personally hear explanations given by all stakeholders,” read the statement issued through the ministry’s corporate communications unit.

Online pre-registration is required to attend the public hearing, which opens today and closes at midnight of Nov 9.

According to the ministry, participants are also required to be properly dressed and are forbidden from bringing any banners, posters, or other dangerous items. For those who are unable to attend, the proceeding will be streamed live on the ministry’s Facebook page.

Save Malaysia Stop Lynas (SMSL), an advocacy group against Lynas’ rare earth processing plant in Kuantan, had last month said it was disappointed with the Pakatan Harapan government’s decision to extend the Australian company’s residue storage licence.

SMSL claimed that Lynas was producing toxic waste, but the company denied this, stating that the byproduct it produced was safely managed and can be “returned to the environment” through radioactivity dilution and dispersion.

Lynas’ Malaysian operations have been under scrutiny by the country’s new government over concerns that its six-year-old plant that processes rare earth used in industrial magnets is harmful to the environment.

Putrajaya has since set up an executive committee to review operations of the Lynas plant and gave it until the end of this month to submit a report with recommendations for the government.

China Launches Crackdown on Rampant Smuggling, Illegal Production of Rare Earths

By Ke Baili

A mining site for rare earth metals is seen in Baotou, the Inner Mongolia autonomous region, on March 18. Photo: VCG
A mining site for rare earth metals is seen in Baotou, the Inner Mongolia autonomous region, on March 18. Photo: VCG

China has launched another crackdown on the country’s rampant smuggling and illegal production of rare earths, as authorities try to get a better grip on an underground industrial chain that has hamstrung their efforts to set world prices.

The Ministry of Industry and Information Technology (MIIT) said a one-month special inspection was launched on Tuesday, aiming to stamp out illegal mining, excess production, environmental violations and smuggling of rare earths, according to the state-controlled China Securities Journal. The notice also called on the media to help report wrongdoers and expose crimes.

Sometimes dubbed “Industrial MSG” in China — referring to the flavor intensifier monosodium glutamate common in Chinese cuisine — rare earth metals are a group of 17 elements used in smartphones, wind turbines, hybrid-car batteries, and many other high-tech products. China is responsible for 90% of global production, according to the Ministry of Commerce, and this virtual monopoly has caused concern in the U.S. and Japan, both major importers of the metals.

China supplied 78% of U.S. imports of rare earth metals in 2017, according to Trade Map data. The U.S. is sensitive to this dependence — rare earth metals were removed from the latest list of Chinese products the U.S. had slapped tariffs on in September.

Strict production quotas, intended to help control prices and reduce the polluting industries’ environmental impact, have incentivized a thriving shadow industry existing alongside state-approved operations. This shadow industry encompasses the whole supply chain — from mining and extraction, to final export through smuggling over the border. In 2011, 120% more rare earth metals were smuggled out of China than were exported legally, according to the Association of China Rare Earth Industry, complaining that the country, despite its dominance over the supply, could not set prices.

Ensuring that local governments are complying with central directives is a key problem, and is the focus of both the latest inspection and the last major one launched in late 2016. Smuggling had led to more rare earths being exported at lower prices, according to the notice issued that year by the MIIT. In September, Jiangxi province, a major rare earth producer, launched its own four-month investigation into illegal mining and smuggling.

Japanese traders said in 2010 that China temporarily blocked exports of rare earths amid a diplomatic row over the use of disputed waters in the South China Sea, during which a Chinese boat captain was detained. Rare earth prices spiked in 2011 after China ratcheted up export curbs, citing environmental concerns. Three years later, the World Trade Organization ruled against China, saying that such export curbs were not justified. China removed them in 2015, but can still partially control prices through production quotas.

These quotas recently became the topic of controversy, with the MIIT denying a report that alleged that it had cut production quotas for this year.

An Oct. 25 report from Reuters said that China had limited production in the second half of 2018 to the lowest level in five years, citing Netherlands-based Adamas Intelligence. The MIIT said Monday that this claim was “not consistent with the facts,” and China had in fact increased its production quota for the whole of 2018 by 15,000 metric tons (16,500 U.S. tons) from the year before, according to the China Securities Journal.

The MIIT said the reason the quotas for the second half of the year were set so low was because the quotas in the first half of the year took up a greater proportion of annual production. The original Adamas report had acknowledged that quotas had increased in the first half of 2018, but had said most of this increase was simply legitimizing existing black-market production, rather than an actual hike in output.

The Adamas report also claimed that the legitimized black-market production was mostly consumed domestically, and therefore didn’t add to exports, arguing that tightened quotas would probably lead to higher prices.

China exported nearly 40,000 metric tons of rare earth metals from January to September 2018, 3.9% more than the same period a year before, according to customs data.

Contact reporter Ke Baili (

China Refutes Reports About Rare Earth Element Export Reductions

A senior official with the Association of China Rare Earth Industry (ACREI) denied Tuesday the country was limiting its rare earth output and argued quotas for the second half of the year appeared lower because the first half quota was for a larger portion of the total annual quota.

The source, who spoke on condition of anonymity, told the Global Times that media reports were just “hyping up” the situation.

He was referring to a Reuters report on Oct. 25, citing data from Dutch market research firm Adamas Intelligence, that said Beijing was curbing domestic production of the elements, used in electric vehicles and electronic devices including phones and computers.

The country raised the annual quota for rare earths (REEs) mining for 2018 to 120,000 tonnes from 105,000 tonnes, which according to the industry official is the highest level since 2006, when it began setting a quota for production of the elements.

China is the largest producer of REEs and its de facto monopoly has long been flagged as a risk for advanced manufacturers in developed nations. Countries, including the US — which meets 60 percent of its rare earth needs with Chinese supply — took Beijing to the World Trade Organization earlier this decade to force the nation to ease export restrictions.

Sources indicate NdPr Prices Could Rise By 50% Due To China Supply Cuts

Editor’s Note: Mike Luther, Editor and MD of Global REEs Venture indicates “Whether news about tightening rare earth exports from China is speculation or a real provocative action, it is abundantly clear that the global rare earth shortage is a crisis in-the-making.  In light of massive growth in EV production, wind turbines and other new energy devices, rare earth consumption is poised for explosive growth.  Chronic global rare earth shortages coupled with China dominance is the elephant in the room.”This problem has been a long time in coming. This morning I took another look at the 2010 New York Times article about rare earth elements entitled Amid Tension, China Blocks Crucial Exports to Japan. Some eight years later, a New York Times story told the same story with How Rare Earths (What?) Could Be Crucial in a U.S.-China Trade War.  Lynas Corp., one of the few non-Chinese rare earth producers is facing a very real threat of nationalization, closure or substantial regulation for its plant in Malaysia.  The situation is underscored and exasperated by the 2019 National Defense Authorization Act, which prohibits the U.S. Department of Defense from acquiring rare earth magnets – along with certain tungsten, tantalum and molybdenum products – from China, Russia, Iran, and North Korea.  According to Ryan Castilloux of Adamas, a firm that tracks the rare earth industry, prices for one key rare earth mineral, PrNd Oxide, could increase by 10% to 50% within the next 12 months, and is on track to double in price within next five years as demand outpaces supply, Castilloux said.

China rare earth cuts scare global manufacturers

October 25, 2018 at 11:30 JST

LONDON/HOUSTON–The Chinese government is limiting domestic production of rare earth minerals in the second half of the year, a move likely to crimp international exports and send prices for the critical materials soaring, according to data from Adamas Intelligence.

China is by far the world’s largest producer and consumer of rare earths, a group of 17 elements used to make electric vehicles and consumer electronics. The move is already forcing manufacturers to scour the globe for alternative supplies.

For the second half of 2018, China’s quota for rare earth separation and smelting has been cut 36 percent, an attempt to better control the market, according to Adamas, a research firm that closely tracks the rare earths industry.

China’s decision to limit domestic rare earth production to 45,000 tons for the second half of 2018–the lowest in more than five years–provides only enough supply for China’s domestic buyers, according to Adamas.

The semiannual quota had risen to 70,000 tons in the first half of 2018, 40 percent higher than the first half of 2017. But that move was largely seen by analysts and electronics manufacturers as a step to legitimize black market production, with Chinese manufacturing consuming most of that supply.

While China is likely to attend to its own needs before exporting, increased exports would require the country to draw on already-low inventories of neodymium (Nd), prasesodymium (Pr) and dysprosium (Dy), used in electric vehicle motors, said Ryan Castilloux of Adamas.

Prices for one key rare earth mineral, PrNd oxide, could increase by 10 percent to 50 percent within the next 12 months, and is on track to double in price within next five years as demand outpaces supply, Castilloux said.

Chinese exports typically supply around 80 percent of the globe’s rare earth needs, about 156,000 tons annually. Still, exports tend to oscillate wildly from month to month.

In September, for example, rare earth exports jumped 15 percent from August levels, despite slipping earlier in the year, according to Chinese government data.

The Chinese Ministry of Industry and Information Technology and the Ministry of Natural Resources did not respond to faxed requests for comment.

China’s export reticence and market dominance has spooked manufacturers, including Japanese electronics maker Panasonic Corp., which said it is moving to find fresh supply.

“We have been diversifying our procurement channels, building partnerships with our suppliers and working to reduce the use of rare earths,” Panasonic said in a statement to Reuters.

The U.S. military is worried about China’s dominance of the rare earths market, calling it a “significant and growing risk,” according to a Pentagon study released earlier this month.

Australia’s Lynas Corp. is the only significant producer of rare earths outside of China through its processing plant in Malaysia. But last month a Malaysian politician said that plant should be closed, denting the company’s stock and further unnerving the rare earths market.

Research into rare earth alternatives has come up largely empty, leaving manufacturers beholden to the specialized minerals just as demand for batteries for electric vehicles and other products that use the materials is soaring.

A typical Toyota Prius, for example, uses 25 kilograms of rare earths, compared to 1 kg in a typical combustion-engine vehicle.

China Reduces Rare Earth Output; Price and Availability Expectations Uncertain

China cutting rare earth output, unnerving global manufacturers
Reuters,Barbara Lewis, Ernest Scheyder

LONDON/HOUSTON (Reuters) – The Chinese government is limiting domestic production of rare earth minerals in the second half of the year, a move likely to crimp international exports and send prices for the critical materials soaring, according to data from Adamas Intelligence.

China is by far the world’s largest producer and consumer of rare earths, a group of 17 elements used to make electric vehicles and consumer electronics. The move is already forcing manufacturers to scour the globe for alternative supplies.

For the second half of 2018, China’s quota for rare earth separation and smelting has been cut 36 percent, an attempt to better control the market, according to Adamas, a research firm that closely tracks the rare earths industry.

China’s decision to limit domestic rare earth production to 45,000 tonnes for the second half of 2018 – the lowest in more than five years – provides only enough supply for China’s domestic buyers, according to Adamas.

The semi-annual quota had risen to 70,000 tonnes in the first half of 2018, 40 percent higher than the first half of 2017. But that move was largely seen by analysts and electronics manufacturers as a step to legitimize black market production, with Chinese manufacturing consuming most of that supply.

While China is likely to attend to its own needs before exporting, increased exports would require the country to draw on already-low inventories of neodymium (Nd), prasesodymium (Pr) and dysprosium (Dy), used in electric vehicle motors, said Ryan Castilloux of Adamas.

Prices for one key rare earth mineral, PrNd Oxide, could increase by 10 percent to 50 percent within the next 12 months, and is on track to double in price within next five years as demand outpaces supply, Castilloux said.

Chinese exports typically supply around 80 percent of the globe’s rare earth needs, about 156,000 tonnes annually. Still, exports tend to oscillate wildly from month to month.

In September, for example, rare earth exports jumped 15 percent from August levels, despite slipping earlier in the year, according to Chinese government data.

The Chinese Ministry of Industry and Information Technology and the Ministry of Natural Resources did not respond to faxed requests for comment.

China’s export reticence and market dominance has spooked manufacturers, including Japanese electronics maker Panasonic Corp, which said it is moving to find fresh supply.

“We have been diversifying our procurement channels, building partnerships with our suppliers and working to reduce the use of rare earths,” Panasonic said in a statement to Reuters.

The U.S. military is worried about China’s dominance of the rare earths market, calling it a “significant and growing risk,” according to a Pentagon study released earlier this month.

Australia’s Lynas Corp is the only significant producer of rare earths outside of China through its processing plant in Malaysia. But last month a Malaysian politician said that plant should be closed, denting the company’s stock and further unnerving the rare earths market.

Research into rare earth alternatives has come up largely empty, leaving manufacturers beholden to the specialized minerals just as demand for batteries for electric vehicles and other products that use the materials is soaring.

A typical Toyota Prius, for example, uses 25 kilograms (55 pounds) of rare earths, compared to 1 kilogram (2.2 lbs) in a typical combustion-engine vehicle.

Additional reporting by Makiko Yamazaki in Tokyo, and Tom Daly and Beijing Newsroom; Editing by Bill Berkrot
Our Standards:The Thomson Reuters Trust Principles.

A Clarion Call: China Can’t Control the Market in Rare Earth Elements Because They Aren’t All That Rare

Editor’s Note: The story below was published in early 2018. We decided to re-publish the story because it makes an extraordinarily good point. The story replays the worn-out phrase “rare earths are not rare”. We are as tired of hearing that as anyone. However, the story does a good job in stating the fact that rare earth scarcity is really about processing. The plain truth of the matter is that, right or wrong, China took the “dive” and made the effort to process rare earth elements just as the USA’s Molycorp was entering a period of decline. Today, China is the de facto rare earth producer for the world. The country is paying the price from an environmental perspective. Based upon our visits to China, the country is doing a good job with the environmental issues. There is still work to be done, but we are optimistic. Moreover, the Chinese know the environment cannot be cast aside. The key point we want to make is the fact that the USA and other countries have access to rare earth elements. Indeed, the elements are scarce on a volumetric material level. However, the rare earth material exists on American soil in ample quantities. The key issue is processing. In relation to other economies, America is spending a pittance on the effort to process rare earth elements. Worse, America is spending next-to-nothing on new technology. Oddly, the only party in the United States spending money on rare earth processing technology is the U.S. Federal Government. There is mounting interest and activity at the State level too.  We understand good things are in the works in North Dakota, West Virginia, Illinois, Kentucky and other states.  However, where is industry? American industry seems to have lost its soul. Where are the leaders who have vision? Ford Motor Company, a business that has every reason to be spending money on rare earth elements is nowhere to be found. When Henry Ford was alive, he had vision and took risks in order to innovate.  I have fond memories about Ford’s work to improve the rubber tire, including the creation of rubber tree plantations in Brazil. It is too bad that Steve Jobs is no longer alive. What on earth would he have done about the rare earth problem? When Polaroid Corporation was at its peak, the Company was the largest patent holder in the world. We can thank Edwin Land for Polaroid. The rare earth elements are in America and most everywhere else. China is not the problem. The solution is called “processing”.  Before you move on from this article, look at the image above.  America towers above every country in the world with economic resources. Surely, we can do better with rare earth elements. We close this commentary by making a call to all entrepreneurs…this is a clarion call. HELP! (The comments above are purely those of Mike Luther, Editor & MD of Global REEs Venture.)

Rare earth elements are often produced as byproducts of other mining operations.
Photo by China Photos / Getty Images

James Vincent, The Verge

If you need to know one thing about rare earth metals, it’s that they’re crucial to modern technology, helping power everything from MRI machines and satellites to headphones and nuclear reactors. If you need to know two things, it’s that despite their name, they’re not at all rare.

This second fact is crucial when putting recent headlines about these 17 oddly named elements in proper context. Last week, many publications covered the news that a Japanese team of scientists had found a huge trove of rare earth elements off the coast of the country’s Minamitori Island. Some 16 million tons were estimated to be lurking in the deep-sea mud, enough to meet global demand on a “semi-infinite basis,” said the researchers.

This news was positioned as having great geopolitical significance. China currently produces more than 90 percent of the world’s supply of rare earth materials (the exact figure tends to fluctuate year-by-year), and in the event of a conflict, said reports, it could jack up prices for the West and its allies, or even shut them out altogether. In this eventuality, the Minamitori hoard would be a lifeline. “It is important to secure our own source of resources, given how China controls the prices,” Professor Yutaro Takaya Waseda, who led the Japanese research team, told The Wall Street Journal.

But experts say the narrative here is wrong. Despite appearances, the Minamitori find is not as significant as headlines have implied. And although China seems to wield great power over this critical global supply chain, the truth is that the country can’t just bring the West to its knees by limiting the export of rare earth elements. We know this pretty conclusively because it tried this in 2010, and it didn’t work out. In both cases, the overlooked factor is just how difficult it is to produce rare earth elements, compared to how easy it is to find them.

An aerial view of Minamitori Island taken in 1987. The rare earth ores were discovered in the seabed near the island.
Image: Wikimedia Commons

The name “rare earth” is a historical misnomer, stemming from that when they first discovered, they were difficult to extract from surrounding matter. The USGS (United States Geological Survey) describes rare earth elements as “moderately abundant,” meaning that although they’re not as common as elements like oxygen, silicon, aluminum, and iron (which together make up 90 percent of the Earth’s crust), they’re still well dispersed around the planet.

The rare earth element of cerium, for example, is the 25th most abundant on Earth, making it about as common as copper. But unlike copper and similarly well-known elements, such as gold and silver, rare earths don’t clump together in single-element lumps. Instead, because of their similar chemical composition (15 of the 17 rare earth elements occupy consecutive places on the periodic table), they bond freely with one another in minerals and clays.

As the academic David S. Abraham explains in his book The Elements of Power, this makes for a grueling extraction process. To create rare earths from the ore that contains them, this material has to be dissolved in solutions of acids, over and over again, then filtered, and dissolved once more. “The goal is not so much to remove rare earths from the mix as to remove everything else,” writes Abraham.

Rare earth ore goes through these steps hundreds and hundreds of times, and for each new mining location, the concentration of the acids used has to be recalculated in order to target the specific impurities in the soil. To top it off, the whole process produces any number of nasty chemical byproducts and is radioactive.

The whole process is “expensive, difficult, and dangerous,” says former rare earth trader and freelance journalist Tim Worstall. He tells The Verge that, because of this, the West has been more or less happy to cede production of rare earths to China. From the 1960s to the ‘80s, the US did actually supply the world with these elements; all extracted from a single mine in California named Mountain Pass. But in the ‘90s, China entered the market and drove down prices, making Mountain Pass unprofitable and leading to its closure in 2002.

Worstall says there are many reasons production moved overseas. Some of these are familiar: cheap labor costs and a willingness to overlook environmental damage, for example. But there’s also the fact that rare earth production in China is often a byproduct of other mining operations. “The biggest plant there is actually an iron ore mine which extracts rare earths on the side,” says Worstall. This means that, unlike the Mountain Pass mine, producers aren’t reliant on a single product. “If you are trying to only produce rare earths, then you’re subject to the swings and roundabouts of the market.”

Global production of rare earth oxides from 1950 to 2000.
Image: USGS

All this looks like it gives China immense power over the market, but the truth is the world is benefiting at China’s expense. Proof of this came in 2010 when China did actually start limiting rare earth exports because of a dispute with Japan. This threat to the supply chain caused prices to rise, and so investment flowed into new and old rare earth mining projects. Meanwhile, consumers of rare earths like Hitachi and Mitsubishi altered their products to use less of each substance.

In other words, when China tried to take advantage of its monopoly and limit supply, the rest of the world picked up the slack. As a think tank report on the fallout from the 2010 incident put it: “Even with such apparently favorable circumstances, market power and political leverage proved fleeting and difficult [for China] to exploit.” Markets responded and “the problem rapidly faded.” (Money even flowed back into Mountain Pass for a while, although the company in charge, Molycorp, collapsed in 2015 when rare earth prices fell back to 2010 levels.)

So what does all this mean for last week’s news? Well, mostly that it’s not as important as it might first appear. There are plenty of other sources for these elements, and ways to circumvent China’s control of the global supply. Worstall, writing for The Continental Telegraph, points out that last week’s find is nearly identical to one announced by some of the same Japanese scientists in 2011, and he tells The Verge that although the sea bed is most likely home to many rare earth elements, there’s still the challenge of processing the stuff and actually getting it out of the sea and into a usable form.

In a paper describing the Minamitori find published in Nature Scientific Reports, the Japanese suggest a hydrocycle could use centrifugal forces to quickly separate out a lot of the unnecessary materials in the sea mud. But this method is unproven.

“Nobody has ever done it before, and no-one has proved it can work at an industrial scale,” says Professor Frances Wall of the Exeter University’s Camborne School of Mines. Wall tells The Verge that the Japanese team are doing “some nice work,” but says a huge amount of research has yet to be done before the seabed becomes a reliable source of these important elements. “There have been literally hundreds of exploration projects [that have found rare earth metals] and they’ve not been able to go forward through production because they can’t prove they’ll make any money,” says Wall .

Worstall sums up the situation by saying “in mining, there are just two things: dirt and ore. Your back garden contains dirt, because it would cost more to extract the rare earths from it then you would make selling them on. The moment it costs less to extract those rare earths, that dirt becomes ore. But what have the Japanese have found? At the moment, it’s still dirt.”

Bio-fishing’ for rare earths: Peptides as Biosorbents</h3?

How protein fragments can be used for the recycling of electronics waste


Dr. Lederer, Franziska

According to a recent study, strategic raw materials can be recovered using peptides (center). In order to produce these protein fragments for each target material (orange), the HZDR junior research group BioKollekt applies bacteriophages – viruses specialized in infecting bacteria (left). Attached to a carrier material (right) the peptides fish the desired metal out of a solution.

Without important key elements such as copper or rare earth metals, the electronics industry would grind to a halt and electricity would cease to flow. End-of-life products like discarded energy-saving lamps, mobile phones and computers could provide an important secondary source for these valuable elements; however, they are difficult to recover. Unless, that is, small protein fragments are used to ‘fish’ them out – a technique described by researchers at the Helmholtz-Zentrum Dresden-Rossendorf (HZDR) and the TU Bergakademie Freiberg in an article published in the specialist magazine Research in Microbiology.

Nowadays, non-functional energy-saving lamps and old mobile phones can be safely disposed of in special collection bins at supermarkets and other locations, from which they are transferred to smelters where individual components can be salvaged. There are, however, still no economic technologies for recycling the more valuable materials such as the rare earths terbium, yttrium and lanthanum, which are often present in small concentrations and bonded with other components. “By the year 2020, we should be in a position to salvage 25,000 tonnes of fluorescent powder from discarded energy-saving lamps in the European Union alone,” says HZDR biologist Franziska Lederer.

Exotic-sounding compounds such as yttrium oxide, lanthanum phosphate, cerium magnesium aluminium oxide and barium magnesium aluminium oxide, which contain traces of terbium, cerium, europium and other rare earths, are finely dispersed in the powder. The rare earths themselves, which are essential for manufacturing plasma screens, wind turbine generators and electric motors for hybrid cars, have been mined almost exclusively in China in recent years. Export restrictions can therefore adversely affect key technologies on our continent.

The junior research group BioKollekt, which Franziska Lederer has been heading since 1st October 2018 at the Biology Department of Helmholtz Institute Freiberg for Resource Technology (HIF) – a member institute of HZDR – is therefore working on new technologies that can be used to extract rare earths from the fluorescent powder of discarded energy-saving lamps and other similar sources. These methods can also be used to extract important metals such as copper and gold from the tailings of mines or to sort and reuse plastics.

Franziska Lederer models these techniques on viruses that specialize in infecting bacteria. The shell of these tiny ‘bacteriophages’ consists of about 4,000 proteins. Molecular biological methods have been developed to attach short protein fragments to them. These fragments (peptides) are between eight and 16 protein building blocks in length. There are many different sorts of peptide, which means that Franziska Lederer is able to use a billion bacteriophages in her research, each of which has different peptides. Molecular biologists refer to such a collection as a ‘library’.

“The peptides can form small pockets into which certain mini-structures are able to fit,” she explains. A case in point is the rare earth element terbium. Franziska Lederer brings her bacteriophage library into contact with a pure terbium compound which is attached to a solid surface. The surface is then washed, but the bacteriophages and the terbium compound that is a perfect fit for their peptide pockets remain attached.

Reproduction to the point where the perfect fit is found

In a second run-through, the researchers then refine the conditions so that only those bacteriophages with a peptide pocket for which the terbium compound is a perfect fit remain attached. They then analyze the section of the genome of these bacteriophages that contains the blueprint for the peptide. Using this blueprint, Franziska Lederer then concocts the appropriate peptides for the terbium compound.

The peptides are now attached to particles of a magnetic material. If these particles are mixed with the fluorescent powder of energy-saving lamps in a solution, they then attach themselves to the terbium compounds therein. The researchers now use a magnet to ‘fish out’ the particles together with the rare earths. After removal of the terbium compounds, the particles with the peptides can be reused on the next cycle. “With this method, we can obtain specific peptides for various rare earths as well as important metals such as copper, gold and some platinum metals, allowing us to extract the respective substances from highly dilute and complex solutions,” explains Franziska Lederer.

The inventors of the phage display method were awarded the Nobel Prize for Chemistry in 2018. But long before that, Franziska Lederer had received the bacteriophage libraries from the group of the Nobel laureate George Smith at the University of Missouri. As other scientists have hitherto only used the phage method for biological processes such as the production of antibodies, HZDR researchers are veritable trailblazers in the recycling of metals.

Peptides can also be attached to styrofoam beads. The beads float to the surface in a water container with the valuable metals attached and can easily be skimmed off. With such methods, valuable ores can be obtained from mine tailings in which traces are still to be found.

“It may be that we can also isolate peptides that specifically bind certain plastics,” says Franziska Lederer speculatively. Plastic waste frequently ends up being incinerated because it contains a mixture of different plastics. However, the peptides grown by the HZDR research group may one day be able to sort through this mixed waste and thus facilitate real recycling. “Our research is still in its infancy, and a practical application will take some time. We aim to use our innovative technology platform to significantly improve recycling.”

China Report: The USA Is Vulnerable To Rare Earth Supply and China Is Watching; Waiting…

The United States will speculate on China’s rare earth threats (shares)

Note from Mike Luther, Editor & MD of Global REEs Venture - Our sources in China spotted the story below in the China press. The report suffers from a weak translation and for that we apologize. Subtle references are exceedingly important and often the message is "lost in translation".  However, it should be clear from below that China believes that Trump is playing favorites (with the likes of Russia). Moreover, China policy-makers know that the USA is entirely dependent upon China for REEs. The situation is all-the-more tricky in light of the possibility of Lynas' Malaysia REEs plant shutting down. 

According to the report, the Pentagon has 
separately listed rare earths and “energetic 
materials” that are extremely important for 
ammunition and missiles. China's aggressive 
industrial policies have hampered US defense 
technology, involving military solar cells, 
aircraft LCDs, and rare earth elements. Reuters 
previously mentioned that the US Department of the Interior's report released in December last year 
showed that 20 of the 23 key mineral resources 
used by the United States depend on imports from 
countries such as China.

The words “China”, “Chinese” or “Beijing” appeared 232 times in the report, while “Russia” only 
appeared once. The report emphasizes that "China isthe single or even sole supplier of some specialty 
chemicals used in ammunition and missiles." The 
report also mentioned that the US domestic printed circuitboard manufacturing industry is struggling 
under the fierce competition in the global market. "Since2000, the US global production share has dropped by70%." Today, Asia produces 90% of the world'sprinted circuit boards, half of which are 
concentrated in China. As the advanced printed 
circuit board manufacturing industry migrates overseas, the United States may lose control of the 
source of electronic product production.

It can be seen from the above main contents. In addition to the printed circuit board (chip door) that promoted the stock price of Lenovo Group during the National Day, it also highlighted the issue of China's rare earth threat. This issue has been repeated for several years, but the author believes that this is the pride of China and the oil in the Middle East. China has rare earths. We have to take the initiative to get security. The threat of re-selling the United States is nothing more than pressure on China to increase exports, but in the past we all sold it and we did not see them thank you.

Therefore, the author believes that the strengthening of China's rare earth management is in line with national interests. For the United States to speculate on the rare earth threat theory, in the window of economic friction, it is a bit of a prestige. In the world of true and false card houses, or they are more to use this to talk more weight, increase the suppression of China, but also to obtain more power from their home country.
But no matter what, there is no need for any 
purpose. Seeing this threat theory, as China, I am happy inside. For the stock market, related conceptstocks are also happy. Of course, this discussion 
is limited, and it is better to follow up on it. Itis not appropriate to be overly optimistic. It is 
advisable to follow up the relevant dynamic situation first and then adjust the corresponding 
operation strategy.

Europe Preparing To Spend Billions In Battery Race With China, Akshat Rathi

One in every 20 European workers is in the automotive industry. The EU is worried that if it doesn’t catch up on battery technology, those jobs are at risk.

“We know very clearly that the future is electric,” Maros Sefcovic, energy vice president of the European Commission, told the Financial Times (paywall). “You cannot develop new models or high-quality cars if you do not master the skills, innovation, and research link with batteries.”

That worry is not unfounded. Based on planned and existing production plants, 80% of global capacity for lithium-ion batteries is likely to be in Asia, and mainly in China.

Planned and existing lithium-ion battery production capacity

To play catchup, the EU last year launched a “battery alliance.” According to the Financial Times, it offers five kinds of funding:

Individual EU countries will be allowed to fund 100% of research, as long as they involve some cross-border projects. The EU’s Horizon 2020 research fund has set aside €200 million for battery projects; €800 million is available to finance building demonstration facilities; regions looking to promote the industry can apply for the €22 billion regional funds available; and the European Fund for Strategic Investment is available from the European Investment Bank to co-fund the billions of euros needed to build an EU equivalent of Tesla’s “gigafactory” in the Nevada desert.

That’s a lot of billions on offer, and European battery makers will need every euro of it. Northvolt, a company started by former Tesla employees, needs $5 billion to build a gigafactory in Sweden. And there are three other groups looking to build gigafactories: French battery company Saft has partnered with Siemens, Solvay, and Manz; Umicore wants a factory to make battery materials in Poland, and Germany battery maker Varta is likely to announce a collaboration with US carmaker Ford. Asian companies are getting in the game in Europe, too: South Korea’s LG Chem and Samsung are looking to build gigafactories in Poland and Hungary, respectively.

Even if all those projects come through, China, with its huge lead in both battery and electric car manufacturing, is likely to remain on top for at least the next decade, according to Benchmark Minerals.

That said, Europe’s entry in the battery race will have other benefits. The continent’s scientific and engineering expertise could push battery innovation in new directions. More solidly, its regulations could help clean up the raw-materials supply chain. For example, the most powerful lithium-ion batteries require a lot of cobalt, which often comes from conflict zones like the Congo. Europe’s regulations could push for better recycling of lithium-ion batteries, which in turn could lower the expected demand for cobalt and other materials.

And Europe’s ambition on batteries is also necessary to hit ambitious climate goals. Last week the UN published a report showing that, without drastic emissions cuts, the world could lose as much as $500 trillion by 2100—and electric cars that use renewable electricity offer the least carbon-intensive alternative to current gasoline-powered cars.

Some companies aren’t waiting for Europe to catch up on battery-making capabilities, though. In July, BMW said it plans to source $4.7 billion worth of batteries from Chinese maker CATL.

For The USA A Stronger Defense-Industrial Base Starts With Congress

30-Day Lithium Price Chart

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About Us

A Consortium of Rare Earth Element and Critical Material Producers & Customers

We are dedicated to advancement of science, commercial business and investment within the rare earth element and critical material sectors.

Global REEs Venture, Inc. (GRV) is a Delaware Corporate (USA) that is owned by investors and companies engaged in the rare earth element and critical materials industry. It is the objective of GRV to help the rare earth element and critical materials sector to function in a balanced, economically sound and environmentally friendly manner.

An top priority is establish a basis where political and commercial organizations around the world work arm-in-arm with China to diversify mining and processing of rare earth elements and critical materials. Specifically, the goal of GRV and its associates is to move rare earth element and critical material production to an appropriate proportion according to market demand and operation on a worldwide basis.

GRV intends to work with industry and government bodies to establish “best practices” for mining and production in a way that is environmentally friendly. Such efforts will include maximizing material sourcing through recycling, including novel processing techniques for processing mine tailings and residue from abandoned mines.

GRV intends to work closely with multinational corporations that utilize rare earth elements and critical materials to establish a sensible manner to ensure long-term price stability for rare earth elements and critical materials.

GRV is interested in the Lanthanoids, Yttrium (39)and Scandium (21) plus other Critical Materials that occupy the Periodic Table.

–Guided by Market, Technology and Financial Innovation

–Green International Supply Chain as a Link

–Aiming to Stabilize the International REEs Supply Chain

Contact: Mike Luther,


Periodic Table of Elements
Periodic Table of Elements

Below is the list of Critical Materials as published by the the US Government pursuant to Executive Order 13817 of December 20, 2017.  Click the element name for a Producer List and Description.

aluminum (bauxite) rare earth elements
antimony cerium
platinum group metals
the rare earth elements group
graphite (natural)

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