EDITOR: | September 1st, 2015 | 11 Comments

REE trump card: being greener than China?

| September 01, 2015 | 11 Comments
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Search the Greenpeace site for “rare earths” and there are nil items*. Just as well for the rare earth industry.

However, this oversight by the militant environmentalists has provided the non-China REE players a possible trump card before the environmentalists link Chinese REE product and pollution to the world’s most popular tech gadgets: Western REE companies can say they are environmentally responsible (which they are – and have to be).

Earlier this year the British Broadcasting Corporation posted a report on Baotou, the centre in Inner Mongolia where cerium, neodymium and other rare earths are produced. It is infamous for its huge toxic, radioactive lake of REE waste – so infamous that a London tabloid, the Daily Mail,  a few years ago dispatched a team to fill a double-page spread about one of the most polluted places on earth.

In the BBC item, reporter Tim Maughan said this: “After seeing the impact of rare earth mining myself, it’s impossible to view the gadgets I use everyday in the same way. As I watched Apple announce their smart watch recently, a thought crossed my mind: once we made watches with minerals mined from the Earth and treated them like precious heirlooms; now we use even rarer minerals and we’ll want to update them yearly. Technology companies continually urge us to upgrade; to buy the newest tablet or phone. But I cannot forget that it all begins in a place like Bautou, and a terrible toxic lake that stretches to the horizon.”

Apple, and other tech companies, rely on a rip-and-replace attitude from consumers. Look at the way the queues form overnight when the latest model iPhone is about to be released.

But here’s the thing: Apple is environmentally conscious, its clientele is dominated by the young (for whom environmentalism has replaced Christianity as their underlying religion), and the tech companies are very fortunate that all the buyers of iPhones and various other gadgets haven’t made the link between their newest purchase and what happens at Baotou and other REE production locations in China. (It’s not Apple’s fault that its REE come from China: it has little alternative at present.)

Because if they do, it will be interesting to see what is more important: their attachment to gadgetry or their obsession with having a cleaner, greener world.

One potential producer has already tumbled to this.

In a largely overlook report recently, Bloomberg reported on how a Chilean company is planning to boost its rare earth credentials. (It was picked up by one website that headlined: “Rare earth mining in Chile could make China look bad”.) The Bloomberg report concerned a company called Minera BioLantánidos which has a plan to produce neodymium, dysprosium and other elements and is aiming at attracting Apple’s attention. The key is the method of production. This is how Bloomberg Business explained it:

“While operations in China typically pump ammonium sulfate into the ground and wait for the chemical to seep out with the minerals, at Biolantánidos the plan is to dig out the clay, put it through a tank-leaching process with biodegradable chemicals and return it cleaned to the ground, replanting pine and eucalyptus trees. It may be laborious, but [project leader Arturo] Albornoz is hoping companies such as ThyssenKrupp AG, Apple Inc. and Tomahawk cruise missile maker Raytheon Co. will end up paying a premium, knowing their suppliers aren’t destroying the planet.”

As BBC reporter Maughan also noted, “It could be argued that China’s dominance of the rare earth market is less about geology and far more about the country’s willingness to take an environmental hit that other nations shy away from.”

Back in May Greenpeace named Apple as the greenest tech company. But, as the website Australian Popular Science noted, “when analyzing Apple, for example, they measured the environmental footprint left by services like iTunes and iCloud–not at how Macs or iPhones are made”.

What if Greenpeace did start looking at how these products were made?

Perhaps other non-China rare earth hopefuls could follow the Chilean’s lead and look at ways to buff up their green credentials.

Footnote: Something published today in China Daily had an astonishing last two paragraphs. The report was about how Chinese REE producers are looking at downstream technology. At the conclusion, the report quoted Chen Chuandong from the Baotou Research Institute of Rare Earths saying one of the challenges companies have faced is the huge cost often involved in R&D. He added: “When market prospects are good, Chinese companies that are busy making money can be unwilling to invest in innovation or product upgrade. But, of course, also when the market is struggling, there is a reluctance too because they are suffering falling profits or even losses”.

China’s REE Achilles heel, perhaps?

 * This refers only to the Greenpeace Australia site. Unfortunately, if you try from Sydney to access the US or other sites it defaults to the Australian one, so other sites may have REE references.


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Comments

  • Positroll

    “However, this oversight by the militant environmentalists …”
    If Greenpeace etc were only that reasonable. But Alkane has seen it’s fair share of this kind of lunatics demonstrating not against Chinese mehtods of REE production, but claiming the DZP to be the first step towards uranium mining in NSW, since there are minuscule traces of uranium and thorium in the ore.
    http://www.dailyliberal.com.au/story/2945802/protesters-take-a-stand-against-uranium-mining/
    Luckily they were too late in their efforts to derail the DZP, but the risk was always there, despite Alk making clear they don’t have any interst in uranium. http://www.dailyliberal.com.au/story/3042449/no-uranium-mining-alkane/
    So I’m not sure whether the non-Chinese REE industry want to play this card too much, given that most of them have some uranium in the ore …

    “… Tomahawk cruise missile maker Raytheon Co. will end up paying a premium, knowing their suppliers aren’t destroying the planet.” – Um, that’s what cruise missiles are supposed to DO. One small piece of the Earth (like a bunker) at a time only, of course … ROFL …

    September 1, 2015 - 12:35 PM

  • whaleblubber

    Much of what is discussed in this article is well covered in a real interesting and wide-ranging ree article (“Apple’s Dirty Little Rare Earth Secret”) from early 2015. That article might be of special interest to those just getting to know the industry.

    September 1, 2015 - 2:51 PM

  • hackenzac

    I believe that “green” consumers are asking more questions about cradle to grave impacts and the sourcing of raw materials. If a company such as Toyota is sourcing the Prius from black market Chinese rees and they may very well be, then it’s not so a green of a car as many have been led to believe. Sourcing green as a marketing avenue is getting more traction. If you seek to make low impact choices with your consumption, these questions matter. The opportunity to source from a clean mine such as Bokan or Bissett Creek as examples could make all the difference in gaining green market share in comparing products. It’s certainly not a new concept. I’d buy a non Chinese sourced hybrid or phone over one that is everything else being equal. Millions of people would.

    September 2, 2015 - 9:58 AM

  • Jim

    What about Lynas?

    September 2, 2015 - 6:13 PM

  • Jim

    What about Lynas? Is this not a good alternative?

    September 2, 2015 - 6:15 PM

  • whaleblubber

    Jim: What about Rare Element Resources? Is this not a good alternative?

    September 2, 2015 - 7:09 PM

  • RareEarthKing

    Sorry but if the company isn’t TRER or UCORE then it is low grade third world garbage: FACT.

    September 3, 2015 - 12:50 AM

  • Jeff Thompson

    While I do believe some of the North American juniors have a lot going for them and have the best positioning, let’s at least be respectful to all of the other good prospects out there and the hard work they are putting in. There’s no guarantees out there for anyone, and it is still unfortunately possible that none of them will come into production, and the status quo would be maintained.

    September 3, 2015 - 8:25 AM

  • Lok Chong

    If Lynas is so green why wouldn’t the Australian Government or the Australian greenies allowed the huge state-of-the-art REE processing plant be built in the outback close to Mt. Weld and literally hundreds of kilometre from population centres. Or why the Japanese project partners have it built in Japanese territory? The corrupt Malaysian politicians laughed all the way to the bank.
    Yes Lynas is greener than Chinese but will go the way of USA Molycorp Inc.
    I would be surprised that the relentless cash burn have presented the Chinese to buy it for a song and thereby help distribute REE contaminates outside the Chinese Mainland and helping them further consolidate their predominance position -killing 3 birds with one stone…

    September 12, 2015 - 11:15 PM

  • JJBeswick

    Lok Chong maybe you should familiarise yourself with some easily checked facts first.
    1. Lynas were given planning permission to build the LAMP in Australia (at Geraldton from memory) many years ago. They also considered China as a location until they imposed export quotas and taxes.
    2. The only Australian Green opposition was to the Malaysian LAMP after it became a political issue over there.
    3. It’s plainly dumb to put a large chemical plant- using lots of water and other chemicals- in the middle of the desert. Makes sense to put it where people, power, water and chemicals are raedily available. The Mt Weld ore concentrate contributes (from memory) less than 20% to the total materials used at the LAMP. Check the mass balance analysis in the Oeko Report on the LAMP (commisioned by the LAMP’s opponents by the way).
    4. In each of the last 4 months Lynas has released figures for they have been cash flow positive: to quote the last quarterly:
    Positive free cashflow (revenue less operating costs and CAPEX) of A$6.4m for the quarter; substantially improving on the first ever positive free cashflow result recorded in March”.

    September 13, 2015 - 5:35 AM

  • Robin Bromby

    JJBeswick:

    Two points

    1. Re Lynas and Western Australia, that happened well before Lynas acquired the project (which was 1999 I think; if not, 2000). In 1992, the West Australian Environmental Protection Authority approved the plant’s construction near Northam for then owner Ashton Mining.

    2. The West Australian Greens did object: not only about the Malaysian end but what they described as the transport of “radioactive” material from Mt Weld to port across Western Australia.

    September 13, 2015 - 5:13 PM

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