The Anchor House, Inc.

By Clint Cox

October 25-27 marked the third occurrence of the Conference with the longest name in the rare earth industry—Infocast’s Critical & Rare Metals Summit III:  Rare Earths Outlook: Strategies for Managing Rare Earths and Lithium Supply Risk.

The Conference couldn’t have come at a better time and place for the industry, with all of the questions and confusion over quotas, pricing, product availability, and newfound international political posturing. It was fantastic to gather and contemplate the current state of our favorite section of the periodic table – the rare earth elements (REE)!

With Washington DC as the backdrop, and about 100 participants from the government, end-users, junior exploration companies, investors, universities, and media, we began the Conference on Monday afternoon.

Although other rare metals were covered at this Conference, I will only be writing about the rare earths in the synopsis.

DAY ONE

Reka Sumangali of Lux Research spoke about solar, batteries, energy storage and wind in a talk entitled, “Global Demand Projections for Clean Energy Technologies”.  The most interesting point that she raised is that $4.5 trillion of products are dependent on rare metals (rare earths and other rare elements such as gallium, tellurium, etc.).  I’m not sure how Lux calculated this stat, but it makes for a powerful quote!  Sumangali also stated that Electric Vehicles usage will double in 5 years, but in China usage will not be as popular because China subsidizes gasoline (providing less incentive to drive an E-Vehicle.  She also described some of the challenges that each of the clean energy technologies face.

Eric Noyrez, COO of Lynas Corporation, spoke eloquently about REE prices in “Rare Earth Metals Supply & Price Outlook”. Noyrez is forecasting 2010 supply to be at 114,800 tonnes (t) with demand to weigh in at 136,100t (the shortfall here being 21,300t).  By 2014, he predicts that supply will be 169,800t while demand will be 190,100t (a difference of 20,300t). One of my favorite quotes of the Conference came from Noyrez when he stated that, “The prediction of prices is a sure way to be wrong”.

Robert Mackay, President, CEO & Director of Stans Energy Corp., presented his “Survey of Rare Earth Resources of Former USSR States”.  Mackay gave a history of Russian deposits, and spent a fair amount of time explaining his company’s plan for Kutessay II in Kyrgyzstan. He did mention that their company was the first to get a new mining license after the recent coup.

DAY TWO

Bart Gordon, US Representative and Chairman of the Committee on Science and Technology, gave the Congressional Keynote Address to kick off day two.  He explained that he had first learned of rare earth from the New York Times. He then went on to speak of the possibilities of R&D, exploration, recycling, substitution, loan guarantees, and the power of bringing people together to look at the rare earths issue – both within our country and between allies. It was an honor to have him at the event.

James Bacchus, Chairman of the Global Trade & Investment Practice Group at Greenberg Traurig, LLP; Former Chairman of the Appellate Body of the World Trade Organization (WTO); and Former Member, US Congress, followed Gordon with a riveting description of what the WTO can accomplish.  Bacchus detailed the laundry list of ways that countries engage in protectionism including tariffs, taxes, quotas, non-tarriffs and technical regulations.  He told us that there are 153 countries in the WTO and that it is a powerful tool that can directly affect change. One other point that was made was that no member of the WTO is required to exhaust their natural resources for the benefit of the world.

Diana Bauer of the Critical Metals Task Force from the US Department of Energy gave an update of the progress being made with the DOE’s Critical Metals Task Force (which, we were informed, is still finalizing the DOE’s Critical Materials Strategy).  Bauer listed the elements they are targeting as lanthanum (La), cerium (Ce), neodymium (Nd), europium (Eu), terbium (Tb), dysprosium (Dy), and yttrium (Y). Their topics for strategy include:

• Information
• Financial Incentives
• Research & Development
• Education & Training

After Bauer spoke we moved on to a series of panel discussions. The first was broadly called “International Developments”, and included brief talks from:

• Robert Mackay (Stans Energy)
• Seppo Nurmi (from the Delegation of the European Union)
• Satoru Okubo (JOGMEC)
• Atiq Sediqi (Afghanistan Ministry of Mines).

Nurmi spoke about the comprehensive raw materials strategy that the EU began looking at in 2008.  He also stated that cerium (Ce) is abundant, but that there are shortages in La, Dy, Tb, and Nd.  He stressed the need for more rules to ensure a level playing field.

Okubo elaborated briefly on the four-pronged approach that the Japanese are taking to securing REE supply moving forward:

• Exploration overseas
• Recycling
• Researching alternatives
• Stockpiling

Sediqi described rare earth-bearing carbonatite occurrences in Helmand Province and pegmatite fields in the Northeast of the Afghanistan. For more see http://www.mom.gov.af.

The next topic was “The Clean Energy Boom and Critical Metals Demand”.  The moderator was Keith Delaney from the Rare Earth Industry and Technology Association (REITA) and the panelists were:

• Edward Becker (General Motors LLC)
• James Greenberger (National Alliance for Advanced Technology Batteries)
• Taylor Robinson (Northern Power Systems)
• Michael Wozniak (General Electric Company)
• Brian Wynne (Electric Drive Transportation Association)

Delaney introduced the topic with a short presentation, and then we got various bits of info from the group.

Becker updated us on the Chevy Volt and the process for sourcing materials and parts for the vehicle.

Wozniak gave some great detail on the various forms of lighting that are both available now and those being developed.  When referring to supply issues for REEs, he did state that, “Any disruption could be critical”.  In a later discussion with Wozniak, he also stated that there are substitutes, but these are lower performing non-rare earth containing materials–customers and governments are shifting towards products with RE.

Mark Smith, CEO of Molycorp (our lunch sponsor) spoke just before lunch. He had just spent 5 days in China with senior government officials, and had a number of points to make from that trip:

• China will not completely embargo the US & EU
• Cutbacks on quotas will continue
• China is trying to eliminate illegal mining
• China is very transparent about industrial policy – they are trying to get manufacturing to move to China
• China needs technology
• Reducing the environmental footprint is a priority
• China knows that costs will go up

Smith also advocated for a cooperative relationship with China instead of an adversarial one.

Smith also listed his 7 “Imperatives for Success” for the REE industry:

1.    Diversity of supply

2.    Greater international cooperation and coordination

3.    Environmental stewardship in the production of REEs

4.    REE knowledge infrastructure needs to be rebuilt

5.    New applications for REEs

6.    Emergence of vibrant recycling industry

7.    More honesty about the basic facts of REE resources and production

I liked his quote, “Bad data breeds bad decisions”.  You can take that one to the bank!

(Part 2 will be coming this week…)

By Clint Cox

The short answer is “Yes.”

The longer answer involves delicious cheese, beautiful scenery, an incredibly gracious host, some remedial knowledge of Soviet history, a trip to Estonia, and some choir practice!

We arrived in Tallinn on a beautiful day in Eastern Europe:

After we arrived, we drove several hours to a small community near the Gulf of Finland, in Northern Estonia. On the way we stopped to see an old castle, have lunch, and witness firsthand the before and after of windmill technology:

No rare earths in that first one, but it certainly served its purpose well! The second one is a 3-megawatt windmill by WinWinD. The discussion of rare earths in wind turbines provided an excellent segue for our guide and host, David O’Brock (CEO of AS Silmet), to explain Estonian oil shale to us as we drove along – quite fascinating. It is amazing what energy independence can do for a country!

We also learned that Estonians love choirs – almost everyone sings in, or has sung in a choir there. Apparently, a giant choir singing historical Estonian songs played a role in their move toward independence. This might be good for all of us – less talk, more singing!

That night we dined on wild boar and Estonian cheese. Delicious! The next morning we arrived in Sillamäe, home of AS Silmet, on the far North-Eastern edge of Estonia:

I have been hearing about Silmet for years in the context of the rare earth industry. It was an old Soviet production facility. One of the things that surprised me the most from our visit is that Silmet is primarily a niobium (Nb) and tantalum (Ta) shop, with the rare earth elements (REE) processing being a part of this larger operation.

O’Brock was very considerate to let us see a bunch of their products and take pictures of metals and oxides in various forms. We had a bit of fun with this, and he was extremely patient.

Here is the most niobium I have ever held in one hand:

Seriously, I broke a sweat and almost dropped it – which may say more about my lack of effort in the weight room than the weight of niobium!

Here is some Nb oxide with a chunk of refined NbNi metal alloy as well:

Later, we were able to visit what I might call “the money rack” – where they place their most recently completed niobium metal ingots. When you request some Nb, you can slice a chunk off of this metal equivalent of an exotic cheese wheel:

In addition to niobium, they also deal in tantalum, which they refine in their seven electron beam furnaces.

Not to be neglected, Silmet processes light rare earth elements (LREE) as well, and there were plenty of the rare earth oxides on hand to be examined. Here is some neodymium (Nd), which is primarily used in high-strength permanent magnets:

Here is the suite of the first four REEs in their full rainbow glory:

After spending a bit more time in the offices learning about the history and business of Silmet, we were taken on a tour of the facilities with Tiit Vau, the Commercial Director of Silmet.

The grounds were beautiful, and it reminded me a little of a college campus:

We first toured the niobium and tantalum facilities. Although many of the buildings are old and a bit run down, much of the technology is cutting edge, and they produce some excellent material.

We finally arrived at the rare earth production facility:

Mr. Vau was a fantastic guide, as he happily showed us the various stages of rare earth production, and answered a considerable number of questions. My favorite part of the tour was the solvent extraction (SX) circuit – 157 mixer/separators finely tuned to perfection! This is what a mixer/settler looks like:

Now imagine 157 of these magic stainless steel boxes lined up in rows, all impeccably pH-balanced, with precise chemical controls. It’s truly a sight to behold!

At the end of the production line (on the bottom of the 6-story building), we found some one-tonne slings:

This may look like a lonely bag relegated to a dark corner, but I assure you that this is one of my favorite things to see in the industry – product in a bag!

After seeing how they made various REE oxides, Mr. Vau took us up to the roof so that we could get a good view of the rest of the complex:

That night we returned to Tallinn for another fine meal, and a stroll around old town. Tallinn has a very colorful history, and we thoroughly enjoyed its old-world architecture:

There is much ado made about the fact that China controls the rare earth market, and for good reason. However, there is current production of rare earth elements by AS Silmet in Estonia, and it was a great pleasure to visit their facilities.

Very special thanks to David O’Brock (and his wife), Tiit Vau, and the wonderful people of Estonia!

By Clint Cox

We landed in Stockholm with expectations so great that we could almost taste the gadolinite! [Note: NEVER taste gadolinite -- don't try it at home, and don't try it in Sweden. But if you're going to taste something in Sweden, try the pancakes!]

A view of Stockholm:

The almost-epic journey included planes, trains, boats, and buses. On each leg of the trip I imagined that most of my fellow travelers must be seeking the rare earths as well.

Surely there would be spectacular hordes of samarium-seeking, terbium-tweaking, praseodymium-peeking, even gadolinium-geeking crowds jostling for just a peek at the original rare earth mine!

The boat awaits!

We docked at Vaxholm thinking that the mine would be close enough to walk to.

Nope.

The Vaxholm Garrison is supposed to house an exhibit about the Ytterby Mine (it doesn’t). The Garrison is where the discoverer of the first REE-bearing mineral was stationed:

It is worth mentioning that NOBODY we spoke with in Vaxholm had any idea what we were talking about when we mentioned the mine which was the birthplace of rare earth elements (REE), and I don’t think it was just the language barrier… Maybe we just needed to get closer!

We managed to get a bus number that would take us the 15 minutes to Ytterby.

After the final bus stop, we took out our trusty iPhone with its fantastic mapping ability, and followed a long, meandering path through the sparsely populated, but beautiful Swedish countryside:

We began (rightfully) to suspect that our fear of massive crowds of rare earth tourists might be unwarranted.

As we got closer, the street names were beginning to look eerily periodic:

By the time we arrived near our destination, we held out hope that an elderly Swedish woman tending her garden across the street could verify if we were, indeed, in the right vicinity.

My Swedish is far below subpar. I know one word — “gruva”, which I think means “mine” — although it might mean “a nice place to send a couple of Americans so that you can get back to gardening”, as the elderly Swedish woman looked at us quizzically before pointing across the street a the somewhat hidden entrance:

It was the original Ytterby Mine, birthplace of the rare earth elements!

There were no crowds.

No jostling for position just to get a glimpse.

No souvenir shops.

Just a couple of self-proclaimed rare earth geeks on a nice quiet street with a small path up the small hill marked by two stones. Such was the humble beginnings of the elements that have changed our world and transformed modern society.

Welcome!

Get giddy with gadolinite!

From the plaque at the entrance to the mine:

The enthusiastic amateur geologist, Lieutenant Carl Axel Arrhenius stationed at the Vaxholm Garrison was in the habit of looking through dumps at Ytterby after

making interesting finds — and in 1787 he found an exceptionally heavy black broken rock…

From that “exceptionally heavy black broken rock”, Professor Johan Gadolin identified the first of the rare earths in 1794. The mineral? Gadolinite!

At the entrance to the old mine site, there is a plaque placed in 1989 by the ASM that declares the site “An Historical Landmark”.

I was a bit surprised that the mine looked like a simple quarry not much bigger than the average racquetball court. There was some evidence of a shaft (long-since filled in), and the mine itself was filled with vegetation.

Closeup of the rock wall:

We then walked up and around to the top of the mine and found a stunning view of the Swedish archipeligo:

It has taken the rare earths over 200 years to make the journey from this humble mine in Ytterby, Sweden, to the computer screen on which you may be reading this story.

See this GREEN? That’s thanks to terbium (Tb) phosphors in your computer screen!

See this RED? That’s europium (Eu)!

It was worth the wait.

Our world is now brighter, larger, smaller, faster, more efficient, and increasingly more fantastic because of the rare earths.

Kudos to the Swedes!

And thanks!

By Clint Cox

The recent reduction of Chinese rare earth export quotas is a BIG deal.

It’s a HUGE story that reflects the unpredictable nature of this market.

The industry is being shaken.  There will be clear-cut winners and losers.  It may takes weeks and months before things settle.

I just wanted to acknowledge this event, as it will undoubtedly take its place in the long list of rare earth market shaping moments.

Wow.

Later this week I’ll take a stroll back to the beginning of rare earth time…

Dr. Anton Chakhmouradian teaches alkaline and carbonatitic systems at the University of Manitoba.  I believe that his research is both top-notch and absolutely critical for the furthering of our understanding of rare earths in various geologic settings. This interview was conducted by submitting questions to Dr. Chakhmouradian which he answered and returned on 3 May 2010.

How complex is the study of REEs compared to base metals or precious metals?

I think, in mineral exploration, every sector targeting a specific type of resource has its own complexities and challenges. The greatest one for people involved REE exploration, be it companies or academics, is the lack of public awareness, at least at the same level that gold, diamond or base-metal exploration sectors are accustomed to.

One can easily strike a bilateral conversation about gold or platinum with a person off the street, but mentioning neodymium or bastnäsite in that conversation will probably draw a blank stare. This, for the lack of a better word, public ignorance ultimately translates into less support for what I do relative to someone working on platinum, for example, even though the economic impact of these different resource types is probably comparable. Besides, there are purely subjective factors at work here, like the historical role of gold as an inflation hedge, which further amplify the differences between exploration for precious metals and rare earths.

On the technical side of things, the stats are fairly self-explanatory. There are over 250 rare-earth minerals out there, but only about 30 minerals that contain essential Au or Pt. (This is not counting the minerals that contain REE or precious metals substituting for other elements.) So, the mineralogical and chemical diversity alone makes REE research a highly specialized area. On the other hand, REE are much more abundant than any of the precious metals, which means they are easier to detect and track down to the source when it comes to geochemical survey, for example. But, by and large, like I said, every mineral exploration sector has its share of problems.

What are some of the misconceptions about exploration for REEs?

There are many misconceptions, most of which stem from ignorance, the point I have made before. Where should I start? Well, just the lack of understanding of what REE are and what they represent geologically is the source of much confusion and misinformation.

High-profile scandals and spectacular failures in some other areas of mineral exploration, that have enjoyed greater visibility and have been publicized to a much greater extent – like the diamond sector, have cultivated a refined and well-informed generation of entrepreneurs and investors. No one in the right mind would support a diamond project targeting basalts or granites. Unfortunately, the REE sector has a long way to go before it reaches the same level of finesse. For example, just recently, I came across a release claiming that assays from some property returned high values of gold, silver, platinum and other rare earths – and that is coming from a company that is supposed to be advising people on their resource investments.

One of the most common misconceptions is that high TREO numbers equal good ore potential. The problem is that many rock-forming and accessory minerals are capable of incorporating REE, sometimes in significant amounts. Suppose you leave your kids $100,000 in the will – a very round number, right? But what if you have ten kids… or twelve? I have seen a number of carbonatites with overall high TREO values, in which REE are dispersed through a dozen different minerals rather than being concentrated in a single “ore” mineral, and none of those dozen would be abundant enough to get anyone’s adrenaline going. This is what many people do not realize: carbonatites and most alkaline rocks are such unusual beasts that enrichment in REE is actually normal for these rocks.

In some geological settings, more than 50% carbonatites contain >3,000 ppm REE. The catch is to find one with a single REE mineral, which would contain REE at economically viable levels. Secondly, that mineral has to be amenable to processing. For example, over 60% of all proven REE reserves in Russia are “locked” in apatite in the huge alkaline intrusions at Kola, which contains up to 80,000 ppm TREO. However, none of those REE are extracted, even from the Khibiny apatite that is mined and processed for phosphate.

Beyond Kola, there are large deposits of REE-bearing apatite in eastern Siberia, southern Mongolia, South Africa and other places, but technologists are yet to prove that nitric acid leaching of phosphate ore is competitive relative to bastnäsite mining. Then there is eudialyte and several other minerals that may potentially serve as a source of REE, but their economic future is yet uncertain.

What possibilities do you see unfolding in rare earth geological research over the next decade?

First of all, I see some major breakthroughs in our understanding of how and where REE concentrate. With the equipment we have at our disposal these days, we can identify any of the common REE minerals in ten seconds by zapping it with a laser beam, and detect any of the REEs in any sample at the sub-ppm level with a micron-scale resolution. Apart from their obvious practical importance (for resource evaluation, metallurgical studies, etc.), these developments enable us to correlate specific types of REE mineralization with specific rock types, geological processes and tectonic settings more accurately than ever before.

Hopefully, we are going to reach the point soon where our cumulative knowledge could be put together into an integrated model for REE deposits based not only on the type of host rock (which is essentially the extent of our current understanding), but also such parameters as mantle dynamics, tectonic regime, paleogeographic factors, etc. For some deposit types, we are only beginning to unravel the complexities of their origin. Secondly, the recent revival of industrial interest in rare earths has given a boost to field-based research in most parts of the world, which has led to, and will undoubtedly lead to more, exciting finds and, perhaps, even discovery of new deposit types. In Manitoba alone, we have described four new carbonatites in the past decade, three of which host REE mineralization.

Where in the world would you look for rare earths?

Carbonatites and alkaline rocks enriched in REE occur in a variety of tectonic settings, and any of them, provided the right climatic conditions, can develop an REE-enriched weathering carapace. This basically means that a rare-earth deposit can be found literally anywhere on any of the six continents.

There are many other factors at play here which will determine whether it is practical to look for a mineral deposit in this particular corner of the world or another. Let’s say, a fortuitous concatenation of circumstances produces a large carbonatite body in a rift setting with primary monazite, apatite and pyrochlore, which then weathers into a thick lateritic carapace hosting millions of tons of REE- and Nb-rich ore ready to be scooped up. But then circumstances take a turn for the worse and the rift is flooded by sea water. Obviously, several hundred meters of marine sediment deposited on top of our REE-Nb deposit will make it difficult to find and greatly diminish its value.

Then, of course, there are all sorts of political, economic and social factors that might attract or, on the contrary, deter potential investors and entrepreneurs should a commercially viable deposit be found, and have to be carefully thought through beforehand. For all these reasons, I would limit my exploration efforts to the well-exposed parts of North America, including both cratons and younger orogenic belts, as well as understudied investor- and mining-friendly countries with diversified geology, such as Kenya.

What has been the biggest surprise in your study of the REEs?

The greatest surprise of all was that no one has so far attempted to look at the “big picture” of REE transport and concentration, or even systematize the existing knowledge in such a way that some general trends and patterns would emerge. We have a better understanding of where and why different rocks containing leucite form than why some carbonatites are REE-rich while others are barely different from marbles, even though leucitic rocks are not nearly as economically important as carbonatites. But this just means that there is a lot of work to be done, so it was a good surprise.

How do you characterize a carbonatite?

I would like to give you an informal definition of carbonatite, if I may, simply because I have not formed a solid and inclusive scientific definition of my own yet, whereas the one given in the dictionary just does not cut it, in my opinion. Here it goes: Carbonatites are the most mineralogically and geochemically extraordinary rocks of diverse origin and often turning up where you least expect them.

What is the biggest challenge to overcome when looking at REE deposits?

I would say the greatest challenge one has to deal with when looking at a potential REE deposit is tying in microscale observations (things like replacement of one REE mineral by another or chemical variations within a single mineral grain) with large-scale parameters such as resource distribution, grade variations, tectonics, etc. Anyone who has seen a typical REE-mineralized rock will understand what I mean. There are exceptions, of course, but these exceptions are mostly among low-grade deposits which can be easily modeled, like the Lovozero loparite horizons, for example.

It takes a team of professionals with decades of cumulative experience to figure out the micro-macro connections and, ultimately, make the right call. Few other mineral commodities present the same range of mineralogical-technological problems as rare earths. For example, palladium refining is probably every bit as tricky as the extraction of individual lanthanides, but the bulk of palladium mining is restricted to magmatic copper-nickel ores and does not have to deal with problems like radioactive byproducts.

What is the most exciting thing going on in REEs today?

The recent revival of interest in rare-earth mineral deposits offers an unprecedented opportunity to advance our understanding of these deposits and beyond. By “beyond” I mean all the things that do not have any direct implications for exploration, but are important for figuring out how the Earth works.

Knowing what controls the distribution and transport of such an important group of elements as REE opens up all sorts of possibilities for studying any igneous, metamorphic or sedimentary system. For example, we have been looking at ways to discriminate true carbonatites from carbonatite look-alikes and come across some really interesting geochemical observations completely overlooked by metamorphic and sedimentary petrologists before us.

The REE boom is also exciting because it brings us to places that we would otherwise not go, and we bring along new research tools that simply were not available to our predecessors decades ago. I am really fortunate to be part of these ongoing activities, and just wish I had more students to handle the increasing amount of workload!

Have you noticed any increased interest in REEs over the past year?

Yes, I think so.  It seems like 2009 was the best year so far in terms of many new companies getting into the game, old properties getting revisited and re-assessed, and new options cropping up, as well. Very few people had heard of Clay Howells or Kutessay before, and now someone will be working on both of these and many others, which is great. It is about time we steal some of the spotlight from PGM and diamonds! Mind you, I am not a business person and therefore cannot comment on how healthy the REE business is at the moment, but my dilettante impression is that it is all going very well.

What advice would you offer to a young geologist who is interested in the rare earths?

The same advice I give to every one of my students: read the literature and follow what other people in this field are doing, and do not limit yourself to technical reports or papers in Economic Geology. Look at papers describing speciation of REE in fluids and chemical variation of specific REE minerals, experimental studies simulating natural systems, explore foreign literature – look at graphs and tables, if you cannot read the language. It can be difficult at first to navigate a maze of technical terms and diagrams, but there is no way all this information can be neatly packaged and spoon-fed to you by your mentor, and most of it is relevant – you just never know when you are going to need it!

Special thanks to Dr. Chakhmouradian for helping me to understand a number of issues regarding the rare earths!

Dr. Anton Chakhmouradian teaches alkaline and carbonatitic systems at the University of Manitoba.  I believe that his research is both top-notch and absolutely critical for the furthering of our understanding of rare earths in various geologic settings. This interview was conducted by submitting questions to Dr. Chakhmouradian which he answered and returned on 3 May 2010.

Where did you receive your education?

My alma mater is St. Petersburg State University, the second largest school in Russia. For my master’s and doctoral degrees, I studied in the Department of Mineralogy. The Russian postsecondary education used to be very different from the North American. For one thing, so many young people of my generation were interested in geology that each specialized department within the Faculty of Geology (Mineralogy, Paleontology, etc.) was graduating several students every year. With the collapse of the Soviet Union, that interest has dwindled due to the shrinking job market for geologists, and many of my former classmates have ultimately chosen alternative careers, but others have stuck with geology and don’t regret it.

When and how did you get interested in the rare earths?

I was fortunate that way because several of my former profs were involved in the study of the famous Kola alkaline province from the 1950s through the 80s, so I, too, “got hooked”. Both of my thesis advisors were great mentors who passed their knowledge and passion for geology and alkaline rocks on to me. For my thesis, they encouraged me to re-examine the perovskite mineral group, which included loparite, the principal source of rare-earth metals for the Russian industry to this day. Basically, I have been working on rare-earth minerals since 1992 when I first visited Kola and the Lovozero Mountains, where loparite has been mined for the past 60 years.

Was there a particular person or project that was pivotal in your studies?

There was no single person that I can definitively credit (or blame) for my choice of a career path. In addition to my advisors, whom I already mentioned, I should definitely acknowledge my other mentors and senior colleagues who nurtured that interest and contributed to my development as a scientist, including Roger Mitchell, Anatoly Zaitsev and Rudy Wenk. And, as far as the pivotal project goes, it definitely was my PhD dissertation on the Kola perovskites. These minerals are an important repository for REEs, but, besides that, they commonly occur in rocks hosting all sorts of REE mineralization, like carbonatites and nepheline syenites. Some contain apatite loaded with light REEs, others garnet with Y and heavy REEs, others something else yet, like REE carbonates, monazite, or loparite. Every project I have been involved in taught me something new about REEs, helping me fine-tune my methodology and find new exciting avenues of research.

How important is the study of rare earths?

To just say that it is important would be somewhat of an understatement. In a lot of ways, REEs are to us now like aluminum was to people of the late 1800s. Few scientists realized the real value of aluminum at the time, but can you imagine the aerospace, automobile and even the packaging industries of today without this metal?

What is your specialty within the study of REEs?

I am a mineralogist/geochemist by training, so my professional interests revolve around the various types of REE mineralization that we find in rocks of alkaline affinity. Although many great minds have worked in this field, many key issues of REE geochemistry and mineralization remain unresolved. Why, for example, some carbonatites are loaded with bastnäsite, whereas others contain REEs barely above the background levels? Why is heavy REE mineralization prevalent in alkali granites, but so rare in carbonatites?

I bet, every company and exploration geologist would like to find the practically implementable answers to these questions, but it is generally academics, who have the time and instrumental capabilities to dedicate themselves to such long-run goals. REEs are not the only type of resource that interests me. I also work on niobium, tantalum, titanium, zirconium and uranium-thorium minerals. Anyone interested can look at my research “portfolio” on my website:

http://umanitoba.ca/geoscience/faculty/arc/

Where have you explored for REEs?

Because I am not an exploration geologist, I have never really explored for REEs, in the conventional sense of that word, anyway. Exploration requires weeks and months of reconnaissance and fieldwork, which would leave me essentially no time for teaching, student supervision, public outreach and many other activities that are part of my current job. I like my job too much to trade it for full-time REE exploration. I have, however, consulted for a number of companies.

Whenever possible, I try to get out there and see the rocks, touch, scratch and sample them myself rather than using someone else’s material. To me, nothing is like this first-hand visual experience.

What are some of the most interesting sites that you have studied?

I have seen and worked on many carbonatite and alkaline localities in the Northern Hemisphere and they are all interesting and special in their own individual ways. I find it difficult to rank them in any way, because each of the sites I have visited had something special about it, and it may not necessarily have been anything to do with its economic potential.

To this day, for example, I am very partial to the Murun alkaline complex in eastern Siberia, even though it would be a boring place to explore for REEs. There are some beautiful carbonatites and really exotic silicate rocks at Murun, but they are generally poor in REEs. My wife Katya, who is also a mineralogist and carbonatite expert, found a few specs of burbankite in these carbonatites, but that was it. Nonetheless, I hold this place very dear to my heart because of its rugged beauty, its unique gemstones, and other things that I connect to at some conscious or subconscious level.

Geologically, the most complex and, therefore, interesting of all the places I have been to are probably the alkaline and carbonatite complexes of Kola Peninsula. Places like the giant Khibiny and Lovozero intrusions in central Kola have been explored and studied by hundreds of people, but there is probably still enough work for many more generations of scientists to come.

The most geologically challenging, least explored and, hence, most fun to work on are the recently discovered carbonatites in central Manitoba.

How do you decide how to collect samples?

Optimally, I would like to have some understanding of the place where I would be sampling and its rocks beforehand. If any material collected by my predecessors is available for study, that is ideal. I would look at some rocks and thin sections and try to relate what I see under the microscope to what I read about the place and its geology in the literature.

Coming to the field equipped not only with the right tools but also with knowledge gives you a great edge and allows you to conduct sampling in a systematic fashion. When you are in a completely unfamiliar place, choosing the right sampling strategy can be a difficult task. I’d say there is no unified approach to sampling. It all depends on what you are actually sampling (bedrock, loose material of unknown provenance, drill core, etc.), as well as on your maneuverability and scope of your fieldwork. Is your goal to sample methodically one large outcrop, or you will be moving from site to site? Is there any evidence of intense weathering, metasomatism or metamorphic overprint in the rocks you are sampling? What types of analysis do you have in mind for this material?… You have to have clear answers to all these and many other questions before you can work out the right sampling strategy – right for this particular place and the very specific goals you are trying to achieve.

The only generalization I can make is that your samples have to represent the geology of the sampling site as accurately as possible. Also, I teach my students that, if you want to do a thorough job as a researcher or consultant, maintain a meticulous written and photographic record of what you are sampling. I spend as much time as I can at an outcrop, looking at the same rocks, contacts and structures from different vantage points, jotting down my notes, snapping lots of pictures and trying to come up with some plausible story for how this all formed while, hopefully, enjoying a cup of tea fresh off the campfire.

What kind of scientific equipment do you use to research REE samples?

In my research, I use a wide range of analytical techniques, from the “old-fashioned” immersion oils and X-ray powder diffraction to things like Raman micro-spectroscopy, which allows you to rapidly identify minerals based on how they interact with laser light – whatever gets the job done.

Step one is always petrographic analysis using polarizing microscopy, but it is never enough just by itself because it does not let you distinguish between optically similar minerals and does little for grains smaller than 50 microns.

I teach my students to follow up the petrography with energy-dispersive analysis, back-scattered-electron imaging and Raman micro-spectroscopy to make sure they’d be able to point at any grain in their rock and say what that is.

Depending on the task at hand, available budget and degree of my interest, I can then decide if any advanced, and generally more expensive, work needs to be done. For example, I often use stable-isotope analysis because it helps distinguish carbonatites from other rock types; to figure out the distribution of REEs in my samples, I use laser-ablation mass-spectrometry, and so forth… There is an instrument to tackle almost any problem one can think of. And, like I said, the problem does not have to be of practical nature – I am a scientist, after all, and sometimes “get carried away” in what I do.

If my work on a project turns up something of purely academic interest, I sometimes decide to pursue the new research lead at my own expense. For example, I once did some work for Avalon and stumbled across an unusual mineral which was of no economic value to anyone, but had a very unusual chemistry. So, I asked Don Bubar for his permission to use their material for study, and it turned out to be a new mineral that my colleague Luca Medici and I described in the European Journal of Mineralogy a few years ago.

What advantage does the equipment give you?

It is as essential as an acoustic aid to a hearing-impaired person, only in so many more ways and at many different levels. It gives you the advantage of knowing – not guessing – but knowing exactly what type of rocks and minerals you are dealing with, what their composition is, and everything else you will ever need to know.

The basic equipment, like a petrographic microscope, is well worth an investment, while other, more expensive instruments like an electron microprobe may not be affordable, but should still be at an arm’s length when you need them.

Just one example: Eu is about one hundred times more expensive than Ce. Variations in Eu content in ore minerals such as monazite can be as much as one order of magnitude, which means a tonne of ore can be worth hundreds of dollars or thousands at the same TREO grade. You won’t be able to say if it is hundreds or thousands unless you “go analytical”.

Anyone working on such complex types of mineral resources as rare earths should develop a network of willing and expert collaborators in academia to have access to the equipment and analytical expertise.

More next week…

By Clint Cox

Today the US Government Accountability Office (GAO) publicly released its eagerly anticipated report entitled “Rare Earth Materials in the Defense Supply Chain”.

Although there are no colossal revelations in the report, it is a fascinating read and shows the thorough nature of the GAO. In putting together the report, they contacted:

• Department of the Interior
• Department of Commerce
• Department of Energy
• Department of Defense
• Various members of industry and academia

They go through a number of issues in the report, including a look at key rare earth processing steps (emphasis mine):

• Mining rare earth ore from the mineral deposit
• Separating the rare earth ore into individual rare earth oxides
• Refining the rare earth oxides into metals with different purity levels
• Forming the metals into rare earth alloys
• Manufacturing the alloys into components, such as permanent magnets, used in defense and commercial applications

When simplified, the above list gives us the following stages of rare earth products:

• Ore
• Oxides
• Metals
• Alloys
• Components

There are different players involved at each of the above stages, and many smaller stages between—so the complexity of what the GAO is undertaking here (an understanding of REEs in the defense supply chain) is no small endeavor.

When looking at rebuilding the supply chain, the following statement is made:

Based on industry estimates, rebuilding a U.S. rare earth supply chain may take up to 15 years and is dependent on several factors, including securing capital investments in processing infrastructure, developing new technologies, and acquiring patents, which are currently held by international companies.

15 years seems optimistic to me, but I’m all for rolling up some sleeves and getting to work!

It is also clear from this report that other agencies have recently researched, or  are currently researching the rare earth issue, including:

1. DOD study to be completed September 2010
2. Air Force’s Materials and Manufacturing Directorate internal report 2003
3. Army’s Armament Research Center informal efforts to understand dependency on REEs
4. Naval Surface Warfare Center informal efforts to understand dependency on REEs
5. Navy considered funding Mountain Pass in 2006 under Title III program
6. Department of Commerce roundtable
7. The Office of Science and Technology Policy in the Executive Office of the President interagency meeting recently
8. Department of Energy R&D projects
9. Department of Energy strategic plan for REEs being developed

This report is critical because it outlines the efforts underway by our government to understand important topics surrounding the rare earths.  The government is a powerful force, and it can have a profound impact on the industry as a whole.  That there is so much interest from the government is phenomenal — how it plays out will be worth watching!

Now we wait for everyone’s response!  Like a great soap opera – how will the media respond?  How will the different agencies work together?  Will this affect the current legislation being considered by Congress (HR4866)?

If you’ve missed the rare earth show up until now — there still may be plenty of action to come!

By Clint Cox

It was stated at the Technology and Rare Earth Metals for National Security and Clean Energy (TREM) Conference in Washington DC on March 17-18, that there are two modes of energy policy in Washington:

1. Complacency
2. Panic!!!

This may prove true for the rare earths as well. Please don’t misunderstand, the Conference was filled with intelligent and fantastic conversations, but the mood has changed and it is now clear that this issue is beginning to gain some favor in Washington DC.

Now for some highlights!

Dudley Kingsnorth of IMCOA had plenty of insight to share with the audience. At one point, he spoke about the importance of the pilot plant phase for rare earth exploration companies. Pilot plants are built in order to establish the flow sheet and according to Kingsnorth are required to:

• Generate samples for customer approval as basis for sales contracts
• Demonstrate technical viability
• Provide data for bankable feasibility study
• Generate data for environmental impact statement

The real shocker that Kingsnorth revealed didn’t seem to garner much fanfare, but is critical to this discussion and should change the tenor of discussion: Rest of world (ROW) demand has been lower than exports since 2005. In other words, all the hype about China shutting off the rest of the world isn’t necessarily backed by the facts. At this point, the Chinese export quotas have easily accommodated the demand by the rest of the world for material outside of China. This opens up other discussions, but may change the character of some of the arguments being made.

Constantine Karayannopoulos of Neo Material Technologies Inc. offered some great perspective as president and CEO of a company that operates facilities within China. He pointed out that China has one strategy in the rare earth business – employment growth. Provincial governments are judged on job growth.

His final points for the audience were:

• Reduce red tape
• Research & development (R&D) are indispensable

Paul Werbos, the Research Program Director of the National Science Foundation, reinforced Karayannopoulos’ last point. Werbos emphasized that R&D can have a dramatic effect, and he pointed out that new cross-disciplinary research might maximize the probability of breakthrough designs.

Gareth Hatch of Dexter Magnetic Technologies explained some of the issues surrounding new wind turbine capacity and its demand for neodymium (Nd) oxide moving forward. For instance, he pointed out that demand for Nd in wind turbines might reach 2,950 tonnes by 2013.

Peter Dent of Electron Energy Corporation stated that samarium-cobalt is a $300 million industry and that ferrites (magnets based on iron technology) still retain a 90% share of the entire market.

Sheeraz Haji of Cleantech Group LLC spoke of the revolution in financing for green technologies, as the percentage of venture capital that goes into green tech has risen from less than 2% in 2003 to a predicted 27% in 2010. Wow! That is significant. He pointed out that 72% of global cleantech investment is happening in Asia / China. This is very startling.

Haji also stated that Walmart is demanding energy usage, water usage, and waste data from suppliers.

Steven Duclos of General Electric Global Research had some fantastic perspective on REEs and strategic materials. He showed a criticality diagram which displayed the supply and price risk associated with individual elements and their potential impact on General Electric.

He is very aware of the effect of supply issues, and suggested that parallel paths must always be taken because you don’t know which path will be successful.

One of the great charts that he used showed the elements used to make incandescent lamps, fluorescent lamps, white LEDs, and White OLEDs. The surprise? No rare earths at all in the white OLEDs.

David Sandalow, the US Assistant Energy Secretary for Policy and International Affairs, had much to say regarding rare earths.

“It goes without saying that diversified sources of supply are important for any strategic material. So too are substitutes and strategies for re-use and recycling. If rare earth metals are going to play an increasing role in our economy, we need to pursue those strategies. And there’s every reason to believe that rare earth metals could play an increasing role in the global economy as the world transitions to clean energy.”

To address the availability of REEs and other strategic materials, Sandalow suggested a three-part approach:

1. Globalize supply chains for strategic materials
2. Develop substitutes
3. Promote recycling, re-use and more efficient use

He also announced the proposed development of a strategic plan:

“To help address these concerns, I am today announcing that the Department of Energy will develop its first-ever strategic plan for addressing the role of rare earth and other strategic materials in clean energy technologies. The plan will apply the approaches described above and draw on the strengths of the Department in technology innovation. We will build on work on these topics already underway, including in DOE’s national labs, and work closely with colleagues from other agencies throughout the U.S. government. We will solicit broad public input, including from the stakeholders and experts here in this room.”

Sandalow mentioned that there was lots of work underway already, and that there were no firm timelines yet in place.

His talk was well received by the audience, and we look forward to hearing more.

Full Metal Jacket, a panel discussing rare earths from the Pentagon’s perspective, addressed the complexity of assessing the both the Big Picture and specific needs. Some of the issues raised during the panel were:

• Looking at both civilian and military uses for REEs
• The DOD doesn’t buy rare earths – it buys tanks, ships, guns, etc.
• There is no national strategy on REEs thus far
• They are looking at cradle to grave issues with materials

Mark Smith of Molycorp Minerals pointed out on the producer’s panel that it is hard to find qualified people with REE skills.

Congressman Mike Coffman spoke about HR4866 – a new rare earth bill that he had just introduced the day before. From the bill:

A bill to reestablish a competitive domestic rare earths minerals production industry; a domestic rare earth processing, refining, purification, and metals production industry; a domestic rare earth metals alloying industry; and a domestic rare earth based magnet production industry and supply chain in the United States.

Many people in the audience have been watching this closely, so it was great to have Congressman Coffman talk about this with us in person.

Cindy Hurst gave a good talk on the history of China and the rare earth industry. She has written a paper entitled “China’s Rare Earth Elements Industry: What Can the West Learn?”.

We spent the afternoon of the second day in breakout sessions that were both fascinating and illuminating, as this diverse group of participants was able to discuss and debate these issues together.

Special thanks to Dr. Gal Luft and Yaron Vorona for putting together one of the best rare earths conferences I’ve been to!

By Clint Cox

My first rare earth conference of the year was an investment bank conference in Australia in Early February – since then it has been an endless barrage of rare earth conference mania!

The SME, Phoenix, February 28-March 3

The Society for Mining, Metallurgy & Exploration (SME) had three technical sessions that included the REEs—one session on March 1, and two on March 3.  At the conference, there were almost 5000 attendees and over 600 booths. The sessions were well attended, and there was also a cocktail party for the rare earth community.

Here is a brief look at the three sessions:

Geology VI: Strategic Minerals and Materials: Harder, Better, Faster, Stronger.

James Hedrick’s talk was entitled “Rare Earths in Defense Applications”.

Cheryl Seeger gave a talk about REEs Missouri called “Mineralogy and Geology of the Southeast Missouri Iron Metallogenic Province“.

Geology IV: Rare Earths: Extraction, Application and the Market.

Ed McNew presented an excellent talk on processing named, “Mineralogical Considerations in the Processing of Rare Earths Ores to Concentrates“.  This talk was chock full of images that showed quite clearly some of the issues surrounding the processing of the REEs. He also discussed many of the instruments used in identifying minerals and their critical properties for processing.

Les Heymann gave one of the best talks I have ever heard on evaluating rare earth deposits in “The Valuation of Rare Earth Deposits”.  He described the difference between Light Rare Earth Element (LREE) projects and Heavy Rare Earth Element (HREE) projects, and the issues of balance that pertain to both. He concluded that NPV is a good way to evaluate REE deposits.

Stan Trout gave a really informative talk entitled “Rare Earth Permanent Magnets: Raw Materials, Magnets and Opportunities”. Trout is one of the leading experts in the field,  but he is also a professor so he has gotten very good at communicating the complexities of the subject in a fun and very informative fashion.

Dudley Kingsnorth was unable to attend the conference, but he graciously allowed me to give his talk, “Rare Earths: Facing New Challenges in the New Decade”, in his absence.  As usual, Kingsnorth’s presentation was replete with fantastic charts—including an update of the legendary “Dudley Chart”. He also had several slides explaining the 10 steps to commercial rare earths production.

Geology V: Rare Earths: Geology & Exploration

Don Ranta presented “Exploration and Evaluation of the Bear Lodge Rare-Earth Project, Wyoming”, giving the audience a useful update on progress being made at Bear Lodge in Wyoming.

Harmen Keyser did an excellent job detailing the rare earth project at Bokan Mountain in his talk, “The Bokan Mountain REE-U Deposit, Prince of Wales Island, Alaska”.

Dr. Anthony N. Mariano gave an illuminating two-part presentation entitled “REE Deposits on a World Level – Real and Potential: Parts 1 & 2”.  In this talk he touched briefly on historic resources and minerals, as well as potential for future deposits around the world.

In addition to these sessions on REEs, there were also several other talks given on rare earths in other sessions, including two by Mark Smith of Molycorp Minerals LLC, and one by Jim Kennedy of Wings Enterprises.

A link to some of the presentations is found here:

http://www.smenet.org/rareEarthsProject/

PDAC, Toronto, March 7-10

For the first time I have been to the PDAC, the weather in Toronto was actually quite nice in March!  There were about 22,000 attendees and about 1000 exhibitors.  The size of this conference is staggering.

Two years ago I wandered the exhibit halls trying to find anyone who cared about rare earths.  I didn’t find many.  This year “rare earth” was the watchword.  What a difference!

Rare earths arrived at the PDAC in style with two cocktail parties (each attended by over 100 people), one power breakfast (standing room only), one exchange forum session, and one technical session (jam-packed, with folks waiting outside).

The number of junior exploration companies looking at this space has exploded.  Boom.  Seriously — there are now hundreds of hopefuls, but very few who know what they are doing.  Rare earth geologists (the very few that there are) are now experiencing celebrity status.

The hooplah is overshadowed by hype, but the hype is most certainly bypassed by the ballyhoo!

How long this will last is anybody’s guess, but it’s fairly entertaining for now.

More to come on the TREM in Washington—lots happened here, so I want to spend a little more time on it.

By Clint Cox

“Do NOT go into the bush!”

We received this warning a number of times before we stepped foot at Mount Weld.  People die out in the bush — an Aboriginal had recently died in the area.  We flew into Laverton from Perth for our visit, and Laverton is hundreds of kilometers from anywhere (730 km to Perth, 930 km to Ayers Rock).  So why, in mid-summer at 40 degrees C (104 F), would anyone want to visit Laverton (population ~500)?  To see some rare earths, of course!

So, welcome to Laverton:

Traveling on this short adventure were several Lynas employees, several analysts, Dudley Kingsnorth, and yours truly. I think there were nine of us on the plane.

After we landed, we drove the short distance to Lynas’ Laverton office, which is a house on a nice quiet street.  At the office we received our steel-toed boots (very comfy, by the way), hardhat, day-glow vest, and some water.  We had a look at the mine site diagram below.  What the diagram doesn’t communicate is how large the site is — those ore grade piles are fairly massive.

We then listened intently to the safety orientation.  Drink lots of water, know where the rally point is, stay with your Lynas-appointed guide, and whatever you do, “Do NOT go into the bush!”

Got it!  Let’s go see Mt. Weld!

The mine is a bit of a distance out of Laverton, so it offered us the opportunity to see this incredibly dangerous bush in all it’s splendor:

[But it's so beautiful... maybe I could go in there for a just minute... I won't go far... soooo beautiful...]

Australians must think that Americans are suckers for kangaroos (we are!) — for just as we pulled up we were greeted with what has become (for me) the mandatory encounter with Australia’s most famous bouncing beast!

“Cue kangaroo!”:

After identifying the emergency rally point and becoming familiar with the emergency water location, we drove the short way to see what we had come for — the pit at Mt. Weld:

It is impressive!

It is 51 meters to the pit floor, and the contents have been placed all around the pit in orderly piles of overburden, topsoil, and ore.  The Southern Zone is found at right in the picture above.  This is where they have found some HREE mineralization mixed with the LREE.  The ore body itself begins below the reddish overburden.

Just for the record, there is no mountain at Mt. Weld — and not because they have blasted it into oblivion.  It has been flat here for the duration of recorded history.

Dr. Anthony N. Mariano says that he first discovered the supergene monazite mineralization at Mt. Weld from core samples in 1980.  And Mt. Weld was certainly known earlier than that.  It is fascinating to think that the rare earths have been known here for 30 years, but they’re just now finding their way out of the ground!  Mining, like the geological events that make it possible, seems to move slowly.

Pictured above are Eric Noyrez and Al, the surveyor. They are standing near the Southern Zone on the pit floor.  Mr. Noyrez is the recently appointed COO for Lynas.  From the December 10 press release:

The Directors of Lynas Corporation Limited (ASX: LYC) are delighted to announce that Eric Noyrez has been appointed as the new Chief Operating Officer of Lynas.

Eric has extensive senior management and board level experience in major multinational industrial and chemical companies. He also has detailed knowledge of the international rare earths industry.

It was extremely helpful to have Mr. Noyrez on the tour — he offered many anecdotes and insights from his time at Rhodia managing their rare earths division.

After spending a bit of time in the pit looking at the mineralization, we headed back up to the surface to gaze at the money rock.

773,000 tonnes of ore is stockpiled at surface according to grades ranging from 8-26% REO.   The picture above is of the 8% stockpile, whereas the picture below (with analyst for scale) is the 26% stockpile.  These numbers may seem high, and they are, but keep in mind that they Lynas won’t recover all of that in their process — no REE mine does.

Pictured below is an ore sample from the 26% stockpile.  It is very soft, and can be easily broken by smashing them against each other. Notice the powdery mineralization coming off in my hand!  Unfortunately, all I have is this picture and my memories [sad violin music playing in the background], as this is the first rare earth site I have ever been to where they wouldn’t allow me to collect samples.

After spending some time at the ore piles, we drove 1.5 km to the site of the concentrator.  The concentrator consists of three cement structures: unloading (where the trucks deposit the ore), the ball mill (where the ore is ground to specification), and the flotation facility (where the finely ground ore is upgraded).  The end product of the concentrator will be a 40-42% REO concentrate which will then be shipped to Malaysia for separation into individual elements.

These structures were mothballed, and construction ceased, when Lynas had funding issues last year.  These funding issues have been resolved, and Lynas now has the money necessary to proceed.

Pictured below is the current structure for the ball mill:

Pictured below is the structure for the flotation plant:

Overall, it was a great trip.

Lynas has accomplished something very few REE companies can claim — they have built a mine and pulled REE ore out of the ground.

It is real.

Now we await the completion of the concentrator at Mt. Weld and the separations facility in Malaysia.  The concentrator should be pretty straightforward, but the separations facility is a very complex operation, to say the least.  Lynas is planning to build the largest processing plant for rare earths in the world, and are currently targeting Q2 2011 for its completion.  This seems to be a very aggressive timeline, but we will watch with great interest.

Special thanks to Matthew James for arranging the trip and being a great host, Dudley, Eric, John, Tony, Geoff, Al, and everyone else that made the trip a success!