Grade is not King for the production of Critical Rare Earths

TRESCjpgMission: We need to focus on the building of a Total Rare Earth Supply Chain (TRESC) outside of China.

The ongoing saga of bringing Molycorp’s Mountain Pass facility into cost-efficient production demonstrates that a deposit’s grade alone is not a sufficient nor, I think, even a necessary metric for success in the rare earth sector.

It cannot be overemphasized that it is, and always has been, obvious that there is not just one unified market governing all of the global transactions in rare earths. There are in fact divergent markets not only for the individual rare earths but also for certain, end-use defined, combinations of them. Therefore the idea of valuing a rare earth deposit by calculating a “basket” price based on the total “value” of the individual rare earths present in the ore body is misleading in the extreme, because it is usually done as a gross valuation calculated from “posted individual prices” and from the amounts of each rare earth element determined to be present in the deposit. The fabrication of the final form in which each rare earth or combinations of rare earths are sold, and the differences in cost of separating, purifying, and compounding them are ignored in “basket prices” even though such costs markedly reduce the initial value of the individual rare earths in the deposits. The value of the typical “ore concentrate” in the feasibility studies I have seen is thus, in my opinion, typically too high, and the discounts stated as given by traders and refiners are often understated.

Analysts working for professional investors seem to have belatedly recognized these facts and are moving the goal posts to reflect the (actual) separation of the rare earth markets into three basic markets, those of the light rare earths, the light rare earth elements (LREEs); the mid-range rare earths, called the SEGs (Samarium-Europium-Gadolinium); and the heavy rare earth elements (HREEs). These divisions are, in fact, man-made, because nature doesn’t provide us with rare earth bearing deposits that respond to chemical or physical separation processes by simply dividing into the above categories or being easily divided into them by further processing.

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The three rare earth markets really identify the rare earths by their relative abundance in nature. The first four rare earths, lanthanum, cerium, neodymium and praseodymium, the LREEs, typically constitute the majority of the world’s largest and highest grade rare earth rich deposits. I have put together the following chart from the data set provided on the web site for the Technology Metals Research, LLC:

Relative Abundance by percentage of the REEs contained in each of the core rare earth markets in selected (by me) depositsLifton-Chart

  • Lynas Corporation Limited – Lynas
  • Molycorp, Inc. – Molycorp
  • Rare Element Resources Ltd. – RER
  • Tasman Metals Ltd. – TAS
  • Texas Rare Earth Resources Corp. – TRER
  • Ucore Rare Metals Inc. – Ucore or UCU

I have added a fourth category, Y, the element yttrium, because it is always conflated with the HREEs, which masks the fact that in every case it, Y, is the major HREE, by volume, in that market. The most important of the non-Y, HREEs today, are Terbium, Tb, and Dysprosium, Dy. The total global new legal production of these two elements is less than 2000 metric tons per year of which ¾ is dysprosium. I believe that if it were not for Chinese recycling of industrial magnet manufacturing scrap and of fluorescent lamp phosphors from end-of-life and industrial processing scrap that both Tb and Dy would be in short supply and that without new supplies of both from outside of China there will be no way to dent, much less compete, with the Chinese near monopoly in the manufacturing of rare earth permanent magnets or to increase the supply of lamp and display phosphors made outside of China. In the case of Yttrium,  Y, China’s dominance today in its production is total. Y must also be produced outside of China in the near future if there are to be any non-Chinese total rare earth supply chains constructed.

The world’s two most imminent undeveloped rare earth total supply chain regional opportunities are North America and Western Europe.  Both have existing skills sets or operating components, which could be enlarged to, or in the case of Europe engaged with, end-user product manufacturing by being anchored upon, regionally, domestic combinations of the mines and junior mining companies above. I place Lynas in this group, because it is able to freely export its output from Malaysia, which is one of the most democratically and free market oriented countries in Asia.

Clearly Europe has only one choice, Tasman, as an anchor for a total domestic European, rare earth supply chain. There are other deposits on that continent that could be developed but Tasman is the best.

The future siting of any rare earth total supply chain outside of China will require a reliable and significant, in terms of output, source base for the SEGs and the HREEs in particular. There is no mass- produced-technology inhibiting shortage of sources of the light rare earths anywhere in the developed world. The problem inhibiting the economic production of rare earths everywhere is the fact that the most common of all of the rare earths found in any and every deposit is cerium, which is also the least useful of the rare earths. Even if we accept that it is a critical material in Fluid Cracking Catalysts and the wash coats for exhaust emission catalysts its actual demand is much less than even today’s annual production just from China. Cerium’s use in the polishing of optical glasses and as a component of the chemical makeup of the glass is substitutable, and is in almost every case of consumer products very price sensitive.

It is the HREEs, Y, and the SEGs that are critical in so many technologies, and it is the sustained and reliable supply of these that is the key to a total rare earth supply chain.

A study of the relative ease of the chemical separation of the individual rare earths from each other shows a very different ordering from that of the simple three markets described above. Such a study reveals immediately the core problem: It is that the overall cost of such separation is mostly due to the cost of removing the light rare earths from the process leach solutions. If we look at the business cases of Molycorp and Lynas, as an example, the problem glares out at us. Each company has spent one billion dollars or more to build a separation facility to process 20,000 tons per year of just LREEs individually and in customer end-use specified combinations. The real value of their outputs is in the didymium (the “natural mix of undifferentiated praseodymium and neodymium) they produce. “Didymium” is today just shorthand for the natural mix of Pr/Nd that each mine produces when it doesn’t separate the Pr from the Nd. This mix is produced mainly for economic reasons. Magnet makers can use the mix, because although praseodymium is not as good a material as neodymium for the purposes of making sintered NdFeB magnets it is more expensive than it would be worth to separate the Pr and Nd from each other just to produce sintered magnets. For bonded magnets it is a different story and for those the added expense of a Pr/Nd separation step is required. Bonded REPMs however are only a small fraction of the total production of magnets of the NdFeB type.

The table above shows that the choice of which deposits to develop to anchor a total rare earth supply chain should be made on the basis of the distribution of the TREEs contained. The other key factors to be considered are:

  1. Grade and the extent of the deposit,
  2. Radionuclides contained,
  3. Ease (cost, safety, and containment) of extraction of the desired REEs from the radionuclides, and
  4. Cost of separation/purification of the desired REEs from all of the contained REEs and non radionuclide contaminants (Fe, Al, F, etc)

Note well that factors 2 and 3, and, lately,4 more and more are coming to trump factor 1 due to advances in our understanding of the chemistries of:

  1.  Ore leaching (called the “metallurgy” in mining engineering), and of
  2. Mineral beneficiation (concentration), and of
  3. Rare earths’ separation from each other as well as of the chemical engineering issues arising from scaling up such chemistries to production levels.

China today produces 90-95% of all of the world’s supply of SEGs, HREEs, and Y. The balance is produced outside of China but almost entirely refined in China. A small proportion of the global production (perhaps 1-2%) of SEG, HREE, and Y bearing concentrates is separated and purified by Belgium’s Solvay Corporation at its operation in France.

The Chinese production of SEGs, HREEs, and Y is done by heap leaching enormous volumes of low grade (less than 0.25%) ionic adsorption clays using mildly acidic reagents. China has no hard-rock deposits of HREEs, and Y, that can be processed more economically. The table above shows that the USA has not only significant hard rock deposits containing SEGs, HREEs, and Y, but also a very large deposit of fine grained material in a porous refractory matrix than can be extracted easily and has the highest proportion of SEGs, HREEs, and Y of any deposit known with the exception of one or two Chinese “clays.” I cannot overemphasize that practice has proved that it is not grade that is important in the production of the rare earths from mines but rather the proportion of the total rare earths contained that is made up of critical rare earths.

In my opinion the ideal American total rare earth supply chain would be anchored upon LREEs from RER, SEGs from RER, UCORE, and TRER, and HREEs (and Y) from RER, UCORE, and TRER. Such an entity could even utilize a single central separation/purification facility, and would then in-gross require the least investment in mining construction as well as in separation and purification. I think that a case can be made that the total investment in such a combination would be altogether less than has already been spent at Mountain Pass just to create a potential oversupply of LREEs.

The ideal American TRESC would be able to easily supply US demand and be able to ramp up to meet export opportunities.

The skill sets to erect and operate rare earth metal and alloy operations and to resume the manufacturing of rare earth permanent magnets from domestic feed stocks are abundantly available in the USA. What is missing is a reliable secure sufficient supply of critical rare earth starting materials.

The necessary skill sets also exist and, much more so than in America, operate today in Europe. For a TRESC to be sited in Europe it will be necessary that Tasman Metals be the SEG, HREE, Y anchor and that a European source of LREEs be found. I think that either Lynas or perhaps a North American entity would be well suited to this purpose.

North America and Europe are today the main destinations for rare-earth enabled mass produced products. The TRESC for this exists today only in China. China’s costs and domestic demand are increasing while its supplies of critical rare earths are decreasing for various reasons many of which are permanent barriers to future production increases.

The time to address the problem of security of supply is now. The future is rapidly approaching, and if it has the same supply/demand scenario for rare earths as exists today then the future of this industry will remain under China’s control.


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About Jack Lifton

Jack Lifton is a Founding Principal of Technology Metals Research, LLC. He is also a consultant, author, and lecturer on the market fundamentals of the technology metals, the term that he coined to describe those strategic rare metals whose electronic properties make our technological society possible. These include the rare earths, lithium and most of the rare metals. Jack Lifton is currently a non-executive Director for Texas Rare Earth Resources Corp. (OTCQX: TRER) and AMR, a private Turkish mining venture. He is a paid business operations/marketing consultant to Rare Element Resources (TSX: RES | NYSE MKT: REE), Ucore Rare Metals (TSXV: UCU | OTCQX: UURAF), Tasman Rare Metals (TSXV: TSM | NYSE MKT: TAS), and NovX21 (TSXV: NOV). He is also the founding co-principal of Technology Metals Research, LLC. His consulting is done through Jack Lifton, LLC, a consultancy he began in 1999 upon his retirement as the CEO of an OEM automotive supply company specializing in process chemistry and metals trading. Jack Lifton, LLC is a member of the Minor Metals Trade Association (www.mmta.co.uk) and Jack is an advisor to the Malaysian Academy of Science in Kuala Lumpur, and he is a member of that Academy’s Rare Earth Task Force.
  1. “I cannot overemphasize that practice has proved that it is not grade that is important in the production of the rare earths from mines but rather the proportion of the total rare earths contained that is made up of critical rare earths.”

    Even this statement has its limits, no? Suppose my backyard is purged of all REEs other than Terbium Oxide, and there is 1 part per billion Terbium Oxide. Then 100% of the REEs are critical, actually super-critical, so to speak, but that wouldn’t be an economic mine. So, while grade is not king, it is not irrelevant,either.

    • Bob,

      I am not saying that grade is irrelevant. I am saying that it isn’t the determinant on its own of an economic deposit.

      Jack

      • “a deposit’s grade alone is not a sufficient nor, I think, even a necessary metric for success in the rare earth sector”

        So which is it? Is grade not even a necessary metric for success, or is it one of several metrics to be considered? Thanks.

  2. The answer is 2000 metric tons. Since their plan is to process 20,000 metric tons per day this means that they will produce 7 tons per day of SEG+HREE+Y. At that production rate TRER would be the world’s largest single-point producer of this combination of materials by weight. The Chinese do much of their heap leaching in districts, which means that they leach out what they want from a hill and then move to the next hill. TRER has the advantage of a deposit that is in one large mass, Round Top Mountain, which can be heap leached from the top down. The “mountain” isn’t that high; it’s less than a quarter mile, if that, but its cross section and soldity (note that Chinese hills are not firm rocky structures) allow a serial top-down operation with a very long life if the “grade” is uniform. So far the deepest drilling that the company has done shows remarkably little variation in the “grade.”

  3. Jack, great story. So you are saying that Silmet in Estonia (part of Molycorp) needs to be bought out and “refurbished” to accept Tasmans concentrate. They can do LREE and SEG separation anyhow, so it will be truly european solution.

  4. Read, and re-read. For all the breathless citations of South China’s ionic clays, Jack is the first to note that grade there is typically <0.25%. His piece is a reminder to me that the first "separation challenge" in REE is to separate the Rares into Ls, SEGs, and Hs — and analyze accordingly.

  5. Heap leaching in-situ is environmentally untenable. At least with ionic clays there is some level of sealing and even it fails. The same material property (permeance) that allows liquids to migrate through the insitu strata also permits the chemicals to travel underground uncontrolled leaving a huge environmental cleanup requirement. Look at the mess in China.

  6. Jack what is the chances of Texas rare earths getting a enviromental licence to heap leach and what is there radioactivity .
    Also if they operate the plant 365 days a year the tonage wool be

    365×20000=7200000 of ore to produce

    365×7=2500 tons of rare earths
    Is my maths right?

  7. The only way that new producers of REEs will be able to secure off-take agreements, project funding and market share is by producing REEs that are in a supply deficit (HREE) as a primary product.

    Alternatively, off-take could be achieved by supplying a product that has substantial ‘value-add’ processing completed but this is an unlikely scenario as most of the proprietary technology, sophisticated engineering capabilities and financial capacity needed to operate further down the value chain are closely guarded by established industry players.

    Hence most companies will be unable to sell only their HREE component, as the economics of extraction, processing and separation will not support requisite project economics

  8. Seems GWG has been deleted from Jacks list,…
    Disappeared after many many years of being on Top of the List
    All the mentioned companies are zombies not able to produce saleable RE Products at prices the would cover the investment.

    • I thought jack had once characterized the SKK project of Great Western’s as “right stuff, right size”. And now they are not even worthy of a mention? Hurt feelings aside, the SKK mine still has the same stuff and still has the same size…..

      • As an REE and radioactive ore body, SKK still has the same stuff and size. As a mine, it still has in effect a size of zero, and it is not at all clear it will be otherwise any time soon, if at all.

        • Ahh yes Bob… But that is not what my comment was alluding to. Correct me if I am wrong, but it was radioactive when Jack was singing its praises was it not? As far as financing goes, it seems like most, if not all REE companies need money. I would rather pony up 200 million than billions to get what I needed…

          • Jack may be privy to information regarding something about GWG, and maybe thats why he is basicly silent on the company.

        • Tracy,

          I am an individual investor who has lost quite a bit on rare earth stocks in the past couple of years, and am trying to learn as much as I can to determine whether I should cut my losses or double down. I want to thank you for this website, an excellent source of information.

          Mr. LeVier stated in your interview, “Where are you going to get the material (the metal) to feed into that furnace to make the alloy? And at what price? You can buy it all day long from China at an elevated price. We have to buy it and be able to make a profit. Obviously, that’s the challenge.”

          Can you please ask Mr. Levier if the recent WTO decision bodes well for GWG since they might be able to obtain feedstock from China at lower prices? (WTO decision referenced below)

          A World Trade Organization dispute settlement panel has basically upheld the joint claim by Japan, the United States and the European Union that China’s export duties on rare earths violate WTO rules.

  9. It’s nice to see that Mr. Jack Lifton doesn’t listen to the other Mr. Jack Lifton who categorically proclaimed just two months ago that, regarding rare earth projects in US:

    “I don’t see a need to follow anyone else ” [other than Rare Elements Resources and Ucore].

    http://www.youtube.com/watch?v=E8vC0Otr1hM

    Personally, I like reading/listening to both Jack Lifton(s) regardless of the their contradictory views.

  10. @catlady Maybe you are right. We dont know why Jim and Gary left the building through the backdoor ,…
    We dont know why they started metallurgy in Q4 2012 although they said we are in Production in Q2/3 2913. We dont know how it is possible to loose 10 Million to a south african contractor without recognizing that he does not work for this 10 Million. And finally I see that MCP has absolutely no problem to get 200Million but for GWG it seems there is no financing available.

  11. “Such an entity could even utilize a single central separation/purification facility,…”, can’t help but wonder, is perhaps Molymet positioning to create that very facility at Mt Pass?
    Prefs converting 1st March 2014 possible trigger point for a deconstruction.

  12. As always, I am grateful to Jack for sharing his knowledge and ever evolving perspective on the rare earth space.

    Reliably, when Jack identifies the junior miners best positioned to participate in a “Rest of World” supply chain solution to China’s choke hold on the rare earth space, there are comments about his omission of Great Western Minerals Group. Great Western acquired the Steenkampskraal mine in South Africa to insure a secure, low cost source of feedstock for Less Common Metals, its alloy manufacturing subsidiary. Steenkampskraal was a pre-existing, albeit closed-in, Thorium mine that happened to have very high grades of the more critical rare earths that could be produced with relatively low cap-ex and op-ex which, once producing, promised to provide secure and low cost feedstock to Less Common Metals insuring robust profit margins.

    Steenkampskraal is a relatively small deposit in the broader scheme of things, but assuming it can fund and execute its mine to metal business model, it is the right size to insure Great Western’s survival as a profitable enterprise with reasonable growth prospects in a non-monopolistic, competitive market environment.

    In the context of Jack’s article, it is ironic that should the players in the rest of the world fail to get their act together to break China’s choke hold on the rare earth space, it would accrue to Great Western’s benefit if they could become their own mini-supply chain. Like a pilot fish feeding off a whale, they would benefit from monopoly pricing. Lou

  13. I’m a fan of Jack’s writing, providing interesting strong opinions. TRER with a heap leach model however, I think that is taking it all a bit too far!

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  16. Wrong again Jack ….

    Grade IS King if the mineralization in which you find the rare earths is Bastnasite, Monazite or Xenotime.

    The chemical composition of these 3 minerals is far simpler than most others, allowing for a simpler process to be designed and implemented. This has a direct bearing on recoveries.

    Get the host rock right, and Grade IS King.

  17. Bill, Great Western’s SKK mine is predominately comprised of monazite ore with grade that is off the charts. But the stock has been pummeled. How would you explain this if grade is indeed king? Thanks, joe

    • Joe,

      the differences between LREEs and HREEs are now clearly acknowledged by the market and this has solidified the view that opportunities for investors lie exclusively in the HREE sector

      hence it was the HREE sector to which I was referring

      Bastnasite, Monazite and Xenotime are the only minerals that have been mined commercially to produce REEs

      Developing a functional and economically viable flow sheet has been a major hurdle for most aspiring REE developers and will continue to be the Achilles heal of the sector

      if you have high grade HREE deposit in Bastnasite, Monazite or Xenotime mineralisation – then Grade IS King

  18. Bill, I’m confused. Doesn’t GWG have plenty HREE/CREE? Even if percentage of the latter in relation to TREE per ton of ore is not as high as that of other companies, I would think the very high concentration of TREE would more than compensate such that per ton of GWG ore there are more kg’s of HREE/CREE than per ton of ore belonging to any other company. Is there something wrong with my math here? A low percentage of an enormous quantity is more than a higher percentage of a small quantity, no? Or is there a metallurgical issue that makes things not quite so simple? Thanks.

    • Not when last I looked:-

      Great Western HREE % 7.6% (Seven point six percent)

      Compare that to Northern Minerals HREE % 84.5% (Eighty four point five percent)

      Grade is king for Northern Minerals high grade heavy rare earth deposit – the xenotime mineralisation has a dominance of high value Heavy
      Rare Earths such as dysprosium, which make Browns Range so unique in terms of future global HRE supply.

      Now do your own research Joe – I’ve now given you enough leads based on my own research.

      • “Grade is king for Northern Minerals high grade heavy rare earth deposit – the xenotime mineralisation has a dominance of high value Heavy Rare Earths such as dysprosium, which make Browns Range so unique in terms of future global HRE supply.”

        No, Browns Range has a dominance of the not really heavy, and in any event, non-HVREE (non High Value Rare Earth Element, see http://investorintel.com/rare-earth-intel/time-ree-name-hrees-2/#comment-200574) Yttrium. 5.7 times as much Yttrium as Dysprosium and Terbium combined. And very little Neodymium and Praseodymium, which are worth considerably more than Yttrium as of now. So yeah, there’s a fair bit of Dysprosium, and if it’s going to be viable, Dysprosium will have to do yeoman’s duty, perhaps with a significant contribution from Yttirum, but I really think Yttrium is headed south once a couple of these so-called HREE mines open up, unless amazing new high value uses of Yttrium are found.

        • Look at the % distribution of the HREE in the grades, because opportunities for investors lie exclusively in the HREE sector.

          As for Neodymium and Praseodymium they are LREE and are found with deposit where the distribution of the LREE Cerium and Lanthanum combined exceed more than 50% of the distribution – this is important to understand and can’t be ignored because both Cerium and Lanthanum are forecast to be in massive oversupply – plus will compete directly with China and hence will adversely affect project economics.

          We saw a recent story here on investor intel – informing us that Molycorp can’t sell all the Cerium oxide it has produced

          Now have a look at page 126:-
          http://www.gwmg.ca/images/file/Reports/GWMG_PEA_Final.pdf
          It shows 67% of Great Westerns production is Cerium and Lanthanum – that’s going to be a heavy burden to carry going forward – especially if the sale price is less than the cost of production.

          Neodymium and Praseodymium are in short supply – however you’re going to have to process a lot of Cerium and Lanthanum first before you get to it.

          As for Yttrium the facts show:-

          In the first five months of 2013, China’s exports of yttrium oxide were up 11.12% to 212,383 kgs compared with the same period of 2012.

          Demand is increasing with the drivers of demand, being phosphors and energy efficient lighting.

          http://www.prweb.com/releases/2013/4/prweb10586184.htm

          More importantly for Northern Minerals the revenue from Yttrium will exceed the cost of production. You can’t say that for the LREE producer deposits (where Neodymium and Praseodymium are found) having to process Cerium and Lanthanum (more than 50% of the distribution) at a cost “greater than” the revenue to be received.

      • The percentage is relative to TREO not to all ore contents. To simplify, according to numbers from TMR, if you were to process one ton of ore from SKK vs Wolverine you would get (in kg):

        Dy 1.61 vs 0.62
        Tb 0.38 vs 0.09
        Nd 29.63 vs 0.26
        Pr 8.39 vs 0.06
        Y 6.70 vs 4.04
        Sm 4.64 vs 0.15
        Gd 3.18 vs 0.40
        Ho 0.24 vs 0.14

        Thoughts?

        • with most rare earth mineralisations one must take on a preponderance of the abundant REEs (Cerium and Lanthanum) to get to the more valuable rarer Rare Earths that appear in much smaller proportions

          there appear to be no shortcuts in treating the REE minerals …. one cannot “send the Cerium to the tails”

          for Great Western with 67% of production being Cerium and Lanthanum

          where as for Northern Minerals only about 5% of the distribution is Cerium and Lanthanum

          processing the Cerium and Lanthanum comes at a cost – and going forward that cost is likely to be greater than the revenue derived from these products

          not having the “rubbish” REEs of Cerium and Lanthanum to an appreciable level makes Xenotime more valuable and with less processing cost per tonne of rock

          • Interesting. So I guess you are saying that separating the CREE from worthless cerium is more costly than just separating CREE from other non-REE constituents of the ore? And this is to such an extent that it outweighs much higher concentrations of CREE in said ore? The cerium cancels it out so to speak? I guess if that is true then cerium should not only be viewed as a non-asset–it should actually be viewed as a subtractor of value. Perhaps a fitting formula would be to divide kg of CREE by kg of cerium such that effectively more cerium dilutes the value of a given concentration of CREE per ton of ore?

  19. We may I think need to coin another term.
    ECRE / ECREO for Expensive and Critical Rare Earths to represent the relative distribution for Pr, Nd, Eu, Tb and Dy.
    When cheap Y is removed, where Grade was King with Y, may cease being true.
    Maybe it is more true that “Grade is No Longer King’ or as we would say here “Grade is No Longer the Only Bull in the Kraal.”

  20. Perhaps you are right Joe .. “a fitting formula would be to divide kg of CREE by kg of cerium such that effectively more cerium dilutes the value of a given concentration of CREE per ton of ore” … and I think someone has done something similar already:-

    http://www.mining.com/rare-earths-miners-race-to-the-finish-line-carolyn-dennis/

    So perhaps “composition of the ore is more important than grade”, and where the composition of the ore demonstrates very little of the “rubbish” REEs of Cerium and Lanthanum : then in those few instances perhaps “Grade is King”

  21. Bill, thanks for the link. I appreciate the dialogue and education, as I am just a novice individual investor trying to dig myself out of this REE investment hole. I looked at Northern but the listing on US pink sheets trades too thinly (minimal volume) so I guess I need to figure out how much Scottrade will charge me to trade on ASX.

    BTW, should lanthanum be grouped with cerium as a detractor of volume? Given that magnets is a strongly growing segment of REE applications, does it not make you uncomfortable that Northern has such little Nd/Pr? Thanks, joe

    • Joe, I have also enjoyed the dialogue. As for the education believe me I am no expert, so please don’t take anything I have said for granted – I am simply an investor who has previously been burnt following the so called experts blindly – since those times I decided to do my own research, draw my own conclusions, make my own decisions – and what I have shared is a result of that research “right or wrong” as it may be. Question everything, don’t take anything for granted, you’re better off to be wrong and learn, than to not try at all.

      There is plenty of valuable information on this excellent site – like the info about Molycorp not being able to sell all the cerium oxide it has produced.

      Is lanthanum going to be in massive oversupply?, if so there’s your answer, because the price will likely drop below the cost of production.

      The Nd/Pr will have to come from somewhere – someone will have to supply it – and there are plenty of other good REE companies that can do that – it just hasn’t been my focus – as you would have already gathered. As for Northern Minerals not having any Nd/Pr, it’s not a concern – my main focus has been identifying who will “likely” be the first heavy rare earth producer to market, and I think I have found it.

      The Xenotime makes it easy for Northern to crack the metallurgy and very low capital expenditure requirements will make it easier to raise the money. Simple logic.

      With capital expenditure estimated at around $130 million – Northern will produce a superior product, in terms of a high purity 92% mixed heavy rare earth oxide – as far as I know this is the lowest capital expenditure for any rare earth element company recorded to date. It means Northerns Internal Rate of Return, Return on Equity and Free Cash Flow levels should be far superior to all their rare earth element peers. Simple mathematics.

      The Scoping Study is due out by end December 2013 – so I will find out then if I am right or wrong in arriving at such conclusions.

      Throughout the centuries there have been men who took first steps down roads armed with nothing but their own vision – I believe Northern Minerals Managing Director George Bauk has the vision, as does their main backer and Executive Chairman Conglin Yue.

      Good luck Joe.

      • BTW Bill, are you an Ozzie, and if so do you think that influences your decision to pick Northern among the handful of juniors that have a chance at making it? Do you have any other favorite companies? I agree with you that capex is a huge deal here such that AVL and QRM may be stifled despite otherwise being great projects. With regard to capex and other factors, TAS seems like a good one. I also think that if GWG can get their sheet together they could be successful partly based on low capex as well, but guess we have to wait on the FS coming out in a few months.

        Ucore seems fishy to me as does TRER. Interesting that Jack Lifton is supporting both of these for whatever that’s worth. Orbite may be a good gamble at this price–interesting article about it today. REE seems very well regarded by all despite primarily being LREE, for reasons I do not understand other than perhaps good management, US-based, and little to no opposition from an environmental standpoint.

        Also, am curious if you have a background in business, mines, metallurgy, or anything that could lend itself to the REE sphere? Thanks, Joe.

        • Joe, yes I am an Ozzie.

          I have an international trading account with my broker.

          I own shares in Northern Minerals and to a much lesser extent Tasman

          No background in mines or metallurgy – just an investor who tires to do his homework

          If you want to know more please email me direct :-

          billkeenes@rocketmail.com

          Kind regards
          Bill

  22. Pending the Scoping Study ( and time), Northern Minerals is an obvious winner, in my humble opinion. But so were all those other ‘very high grade’ deposits, at one time.

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