EDITOR: | May 25th, 2015 | 2 Comments

Mackowski on Innovation and/or Revolutionary Rare Earths Technology (Part 2)

| May 25, 2015 | 2 Comments
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I want to discuss new rare earths technologies as to whether they are innovative or revolutionary. I will be looking at three technologies that have been reported in the last year.

  1. Discarding low value rare earth product (namely cerium) early in the flow sheet so as to reduce the scale and complexity of downstream processing, particularly separation.
  2. Heap leaching of rare earths ore and subsequent continuous ion exchange replacing the standard extraction and purification circuits, ie replacing sulphation/water leaching and impurity removal.
  3. Molecular Recognition Technology (MRT) that replaces the current operating standard for rare earths separation, ie replaces solvent extraction.

Innovation is a new idea, more effective device or process. Innovation can be viewed as the application of better solutions that meet new requirements, inarticulated needs, or existing market needs. This is accomplished through more effective productsprocessesservicestechnologies, or ideas that are readily available to marketsgovernments and society. The term innovation can be defined as something original and more effective and, as a consequence, new, that “breaks into” the market or society.

While a novel device is often described as an innovation, in economics, management science, and other fields of practice and analysis innovation is generally considered to be a process that brings together various novel ideas in a way that they have an impact on society.

Innovation differs from invention in that innovation refers to the use of a better and, as a result, novel idea or method, whereas invention refers more directly to the creation of the idea or method itself. Innovation differs from improvement in that innovation refers to the notion of doing something different rather than doing the same thing better.

revolutionary is a person who either actively participates in, or advocates revolution. Also, when used as an adjective, the term revolutionary refers to something that has a major, sudden impact on society or on some aspect of human endeavor.

I also stated that I would, as a basis for discussion, utilize the recently published Frontier Rare Earths (TSX:FRO), Canadian National Instrument 43-101, Preliminary Feasibility Study (PFS) and its enclosed economic data as a point of comparison so that that the impacts of the technologies can be proposed and the key highlights can be brought forward. I would like to congratulate FRO and their team for a very thorough process of development and reporting.

We got through the issue of innovation. All three technologies are new to the rare earths space and although some have been used in other industries, these technologies are quite new to the rare earths space and can therefore be classed as innovative. We couldn’t conclude on how innovative so I left the game-changer claims to an assessment to their revolutionary implications.

Let us think about a revolutionary change to rare earths processing. What would we see? In a processing sense, any significant change would come in either the quality of the final products, producing something of a quality far superior than previously capable, or in the costs of production, either CAPEX or OPEX, or possibly in some waste management area. Let’s look at quality first.

Table 13: Zandkopsdrift REO Production Profile, below, from the FRO PFS detailed the planned production profile. This table is quite an extensive profile of the products commonly produced across the REO space. There are no surprises here, not new products or missing currently available products. A, to be expected, profile based on the REO suite in the Zandkopsdrift mineralogy. The three new-tech rare earth processing technologies are not presenting claims in the quality area from the literature reviewed. We can therefore assume that the revolutionary change will not be here.

Table13

Let’s look at CAPEX costs. In the FRO PFS, the CAPEX summary is presented in Table 4 (below). For simplicity we will only deal with Phase 1 of the project.

Table4

As specifics for comparison, let’s extract the related costs associated with the mine site at Zandkpsdrift: Mine $80 million, Hydrometallurgical Plant $205 million, Pyrometallurgical Plant $229 million and the Separation Plant $238 million at Saldanha. What are the impacts of these CAPEX figures should the three new technologies be applicable and be utilized?

Let us firstly investigate the technology option 1. Discarding low value rare earth product (namely cerium) early in the flow sheet so as to reduce the scale and complexity of downstream processing, particularly separation. According to previous announcements, 80% of the cerium is to be removed at the same processing step as the removal of thorium. The flow sheet implication of this technology is that the capacity of the Separation Plant is changed. There does not appear to be any change required in the Mine, the Hydrometallurgical Plant or the Pyrometallurgical Plant comparison. Actually if the cerium is to be later accessible for sale, then special considerations will need to be given which may increase some costs. So the impact is on the Separation Plant. How much? A 10,000 tpa light rare earth project will on average produce 5,000 tpa of cerium oxide. If 80% does not reach the Separation Plant then its capacity will be only 6,000 tpa, not 10,000. That is 1,000 tpa cerium and the remainder as was. Now this does not significantly alter the processing layout of the early (light rare earth) stages of the Separation Plant as even though the cerium is 1,000 not 5,000 tpa, it is still there and has to be chemically managed. But what does alter is the size of the separation modules. Those early stages will be 60% of the size of the 10,000 tpa design. OK, how does this impact on CAPEX? The FRO Saldanha Separation Plant is $238 million. I would expect a saving of no more than 10% of the CAPEX. So, say $25 million.

What is the impact on OPEX? Again, I will reference the FRO PFS data, Table 5 below.

Table5

Using the same logic, the number we are looking at is that for the Saldanha Separation Plant. $3.72 separation costs from a net OPEX of $11.87. The mass flow through a separation plant does influence the OPEX due to reagent consumption and energy costs. Labour will be similar since the number of stages is similar. In my experience, I would estimate a saving of ~$1/kg, ie approximately $10.87 overall cost comparison should a smaller separation plant be appropriate and utilized.

So we have a CAPEX saving of $25 million and an OPEX saving of $1/kg. Savings that may justify a move to manage cerium differently but personally, I would not define this technology as a game-changer.

Next week I will continue on the other two technologies…


Steve Mackowski

Editor:

Mr Mackowski is a qualified engineer in mineral processing with over 30 years technical and operational experience in rare earths, uranium, industrial minerals, nickel, kaolin ... <Read more about Steve Mackowski>


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Comments

  • Tracy Weslosky

    Nice piece of copy Steve. I sent this to James Kenny this afternoon, along with Jack Lifton and Christopher Ecclestone for their feedback. As always, thank you for your analysis!

    May 25, 2015 - 4:59 PM

  • Lid

    Thanks, Mr. Mackowski,
    I read very single article you wrote, They are all gems, and many of us readers get benefit from your work, they are all guide lines to enable use analysis RE projects with more confidence. Thanks again.

    May 26, 2015 - 4:27 PM

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