Critical Materials’ Expert says Coronavirus Fall-Out is Catalyst for Reviewing Rare Earths’ Tailings…in Canada
As we are all very aware — the novel coronavirus is impacting nearly every part of everyone’s daily life in one form or another. From a critical materials’ perspective, this has been a wake-up call as the dependence on China, in particular, for just-in-time supply has been highlighted during this time of uncertainty. In looking at the list of 35 critical materials identified by the USA, it is a broad list of elements. This was developed for a number of reasons but was led by the desire of companies and consumers to get lower prices.
Long term strategic thinking was ignored for the desire for quarterly profits and dividends. Is this wrong? No, not generally in that this is how companies, especially public ones, operate in the west and how CEO’s are rewarded. However, look where we are today. Only one new rare earths’ company has emerged in the last decade — Lynas Corporation. Though its survival has been, in part, due to the support of its Japanese lenders who have a long term vision about diversification of supply for critical materials. Since Japan has little in the way of natural resources it is very aware of the sensitivity of single sourcing. That can also be said for South Korea among others.
Get our daily investorintel update
What does this mean for North America and other developed nations? Canada, having a history of resource development, in my opinion, is further ahead than its southern partner in appreciation of what is necessary to support and promote mine development.
See Quebec’s Plan Nord and Saskatchewan and Manitoba who were rated the best jurisdictions for mining globally by the Fraser Institute in 2017. In talking with a developer with projects located in Saskatchewan he was very positive about the response time and proactive nature of dealing with the local levels of government. I remember listening to one mine developer in the USA complaining about the red tape and hurdles he had experienced over the last decade in trying to get approval to move his project forward.
Personally, I was looking at importing a concentrate from Europe to the USA that had ppm levels of lead in it. I reached out to the local EPA office to find out how to report and manage this element. The person I was put in touch with was responsible for lead in paint. This may be in part to the hollowing out of US government departments and lack of focus on resource development.
But not all is lost. I am a strong believer that we should be actively looking at tailings from old mining operations globally. For example, arsenic is on the USA’s Critical Materials list. There are tailings from six mines in New York state with rare earths and arsenic in them.
New technology may be able to address the processing of this to address some of the domestic needs. What is likely preventing this is that it is cheaper to buy from China than process domestically. Then putting it on a list is nice but what steps need to be taken to turn on domestic supply? Recognition by western governments that talk is cheap. Actions speak louder than words. As one can see from the response to the COVID-19, things can be done expeditiously when pushed.
I am sure there are other tailings that were processed with old, inefficient technology where tailings may contain in-situ levels of certain elements that are comparable to new mines that are being considered. The advantage of tailings is that the heavy lifting has been done to get the material out of the ground. In addition, there may be existing infrastructure in place, access (road and rail). As well it addresses the issue of site remediation. This is a legacy issue that could have a win for all sides. Time will tell if this is a viable source of critical materials but it needs government support.
Alastair Neill is the President of Trinity Management, a consulting company specializing in business development activities in rare earths, specialty metals and start-up of technology-based ... <Read more about Alastair Neill>