EDITOR: | October 28th, 2019 | 7 Comments

Lifton and Avalon’s Bubar discuss how to start a new rare earths supply chain outside of China quickly

| October 28, 2019 | 7 Comments
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“We are moving forward with the original plan we developed with them (Cheetah Resources Pty Ltd.) which was to start with a very small scale project to develop a resource in a separate deposit that occurs on the property (Nechalacho Project). A small satellite deposit called the T-Zone that had work done on historically where there is a small but very interesting resource very rich in bastnaesite in a pegmatite. The mineralogy is so simple that we can make a concentrate with just using sensor-based ore sorting technology which makes it very low cost to implement and relatively easy to permit because you are not creating any toxic waste that creates environmental concerns… It could be possible to get something started there in as little as a year and start to show the world on how you can do things a little bit differently to start a new rare earths supply chain outside of China.” States Don Bubar, President, CEO and Director of Avalon Advanced Materials Inc. (TSX: AVL | OTCQB: AVLNF), in an interview with InvestorIntel’s Jack Lifton.

Don went on to say that there is a lot of interest in the government circles in both Canada and the US to establish a new rare earths supply chain. He continued by providing an update on Avalon’s Letter of Intent signed with a private US company, Coal Strategy Advisors, LLC, to earn up to a 50% interest in the Will Scarlett Rare Earths Recovery Project located near Marion, Illinois. He said that Will Scarlett is a closed coal mine site where Coal Strategy Advisors discovered a very high level of rare earths enrichment in the acid mine drainage and in the precipitates generated from lime treatment of the acid mine drainage to neutralize the acidity. He said that Will Scarlett provides Avalon with an opportunity to extract rare earths out of previously-mined waste materials at a relatively low cost.

To access the complete interview, click here

Disclaimer: Avalon Advanced Materials Inc. is an advertorial member of InvestorIntel Corp.


Raj Shah

Editor:

Raj Shah has professional experience working for over a half a dozen years at financial firms such as Merrill Lynch and First Allied Securities Inc., ... <Read more about Raj Shah>


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Comments

  • Tracy Weslosky

    These are 2 of the most knowledgeable industry leaders in the rare earths conversing candidly on the market. Wonderful! Frankly, this is one of the best interviews that currently exist in the market for what is really happening in this geopolitically charged market. Smart investors must watch or listen… this said, I would love for Jack to have some makeover work on his interview room although I do appreciate the extra matching plaid shirt in the background!

    October 28, 2019 - 1:39 PM

  • Ron Malashewski

    Great to see Jack Lifton back in the rare earths with more visibility now…

    October 28, 2019 - 3:15 PM

  • Rare Earths Investor

    Agreed, really good to see that Jack Lifton is now talking seriously about the approaching strategic need for RE and speaking to contacts apparently in the know who are giving support to the idea that the traditional timeline for the generation of feedstock and processing coming online is no longer in the 7 – 10 + year range, but much shorter. Global RE chain diversification can’t be piecemeal but has to have at least some semblance of coordination which you would hope that the US, Canada and AUS are going to be able to create together.

    October 28, 2019 - 4:57 PM

  • Robert Richardson

    Jack, after closely following my investment in Australia’s Lynas Corporation for nearly a decade now, including a visit to its world’s largest chemical RE processing plant in Kuantan Malaysia, I was flabbergasted to hear your comment about the key cost issue for RE production being the enormous ‘costs of the mine’!

    Lynas’s large RE mine at Mt Weld in Western Australia is the richest deposit in the world, with recently expanded proven reserves for many decades of high volume production of ore that’s UNIQUELY NON-RADIOACTIVE UNDER IAEA guidelines. (Please ignore the political nonsense about radioactivity in Malaysia; nowhere else in the world is the Lynas material, including ALL of its residues, classified as a notifiable radioactive substance.

    So open-cut Mount Weld ore extraction and simple concentration for container shipment is a comparatively minor expense issue for Lynas. And because there are numerous other mineable RE deposits in Australia and many other countries, Lynas could conceivably also toll-process RE ores from elsewhere (as China is currently doing with ore from the failed US Mountain Pass mine!)

    BUT IT’S THE SEPARATION INTO THE CRUCIAL WANTED PRODUCTS that’s the ONLY really difficult issue, and this is ignored in your interview. Lynas has spent many years with the world’s best technical expertise to develop the hundreds of separate chemical processes necessary to separate the oxides and carbonates of the most wanted of these elements that are so close together in the periodic table. And although I accept that there are other ways to do this (and I know that Lynas is also examining alternative separation technologies for its currently planned new supplementary processing facilities in the Green Line Texas JV, and in WA.)

    To achieve ‘three and four nines’ purity for the highest value products is incredibly difficult, and this is where Lynas’s hard-won IP, now unique outside China, is so valuable – and irreplaceable in the West within five years, or more likely a decade, in my opinion.

    October 29, 2019 - 3:15 AM

    • Jack Lifton

      Robert,

      It is the non distributed costs in a total supply chain that I am discussing. The “mine” produces and sells a “mixed concentrate. This is the lowest value product in the supply chain, and it has only one use, which is to be sold to a separation facility. The cost of permitting, securing infrastructure, and digging up, processing, and handling the residues from millions of tons of “ore” is immense in terms of the value of the immediate product. The LAMP which roasts the ore, extracts the metal values, prepurifies the PLS, and then separates the rare earths into individual compounds or blends took several years to build and had a 9 month shutdown after start up to resolve some metallurgical problems, but it does add significant value to the mined material. Its, the LAMP’s, output can be sold either to converters, like “Blue” Line in Texas for further chemical processing, automotive catalyst wash coat makers, or to metal and alloy makers, all of whom add value not remitted to Lynas. Finance considers the mine the riskiest part of the supply chain, because it offers the lowest return in the supply chain. Adding, an expensive, separation plant is considered necessary for large scale operations, such as Baotou, Mountain Pass, and Mt Weld even if just to add enough value to the products to make projected financials look good. Lynas’ problem is the lack of non-Chinese further processing capacity demand for its neodymium/praseodymium products. the rest of the world has not yet decided to build a metal/alloy and magnet making capacity to allow Lynas to be independent of the Chinese rare earth processing industry. If Lynas output continues to be dependent on Chinese processing then China will control is future.

      October 29, 2019 - 12:05 PM

  • Tim Ainsworth

    Presume you meant to say “completely” free of Chinese downstream Jack, given the majority of Lynas NdPr is now sold into the Japanese NdFeB industry. Probably the most notable, and largely unreported RE development this decade, is that the Japanese magnet industry is finally expanding again, with apparently strong growth projections.

    Of course driving through your assertion Lynas is producing more critical REO than ROW mkts can absorb, and the Blueline JV will provide the opportunity to complete the suite, raises the question exactly who/where is anyone else going to sell anything of consequence, beyond the Dragon?

    The fact speculators are still waiting for a mkt to emerge is exactly the reason none have been able to raise anything remotely like the level of capital required since the Moly spectacular, and lack of a mkt played a big part in that demise.

    October 30, 2019 - 3:50 AM

  • Bob Grant

    A fascinating conversation. New technologies and new methodologies are being implemented. It seem that the US Federal Government is finally interested, so some new funding may become available. Avalon is a uniquely placed company to carry all of this forward. This is worth listening to twice to insure that all of the information is completely understood.

    October 30, 2019 - 4:42 PM

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