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Ucore’s rare earths processing technology facility offers Louisiana a blue ribbon opportunity for the critical minerals supply chain

As most readers of InvestorIntel know by now, demand for the magnet rare earths is set to surge this decade as the EV and renewable energy booms takes off. Electric vehicles require the magnet rare earths in their electric motors as do many of the most powerful wind turbines.

The problem right now is that there are no rare earths separation facilities of scale in the USA, meaning the market is reliant on China.

Today’s company is one of very few western companies that is making big moves to change that. Notably to develop rare earths separation facilities in North America.

Ucore Rare Metals Inc. (TSXV: UCU | OTCQX: UURAF) (“Ucore”) 100% own the Bokan-Dotson Ridge REE Project (contains Dysprosium (Dy), Terbium (Tb) & Yttrium (Y)) in Alaska and has plans to build a rare earth separation facility in Louisiana, USA.

Ucore is focused on Rare Earth Oxide separation (production) in North America for both heavy (HREE) and light (LREE) rare earth elements

Source: Ucore company presentation

As announced on November 22, 2022, Ucore is in the process of selecting a site for their Louisiana facility and is choosing between three existing brownfield facilities in Southwest and Central Louisiana. Ucore states that they intend “to select a location in Q1-2023 to maintain the development schedule required by prospective OEM partners.” Ucore indicated that they hope to have the facility in operation by end-2024 (Phase 1 – 2,000 tpa TREO) and Phase 2 (5,000 tpa TREO) by 2026 (see chart on page 11).

Ucore states that the Louisiana separation facility (known as the Louisiana Strategic Metals Complex (“LSMC“)) is being designed to:

  • “process 2,000 tonnes of TREO from mixed rare earth concentrates on a per annum basis (“tpa“) in the first and second year of operation, after that, expanding to 5,000 tpa:

    • from multiple US-friendly sources, including heavy REE (“HREE“) and light REE (“LREE“) feedstocks.

  • initially be capable of processing all RapidSX™ splits required to produce individual praseodymium, neodymium, terbium, and dysprosium from each applicable feedstock source. The product line will expand to other individual rare earth elements as the Western REE market develops.”

The four primary rare earth oxides used to produce NdFeB permanent magnet motors are neodymium, praseodymium, dysprosium, and terbium.

Rapid SXTM  technology and demonstration plant commissioning

The LSMC will use Ucore’s 100%-owned Innovation Metals Inc. Rapid SXTM  technology which has already been successfully piloted. Ucore states that “RapidSX™ is a transformative REE Separation Technology” that is faster and has a lower CapEx and OpEx than conventional separation technologies. It is also very scalable.

The longer term Ucore plan is to develop several Strategic Metals Complex Facilities (separation facilities) across North America.

The demonstration plant work is a focus for early 2023. Last month Ucore announced that:

“Commissioning will take place over the next several months. A program designed to demonstrate the significant advantages of utilizing its RapidSX™ technology platform for separating light and heavy rare earth elements into high-purity individual elements/compounds……..The Demo Plant is designed to process tens of tonnes of HREE and LREE feedstock annually. Once the commissioning trials are completed, the Company is planning two additional 10-ton processing campaigns for the commercial demonstration and products qualification program.

Usually, once potential off-take partners have qualified the material, it can lead to off-take agreements. This then typically lends support for potential project funding.

Ucore’s next steps and master plan

Source: Ucore company presentation

Project funding – U.S desperately needs to develop rare earths separation facilities

According to Ucore, there is currently no rare earths separation facilities of scale in North America. This would suggest that Ucore may receive some assistance from the U.S. government to get their Louisiana facility funded. Alastair Neill recently pointed out in an InvestorIntel article: “MP received US$35 million and Lynas US$120 million. This begs the question of whether or not the DoD will support Ucore with this plan of action.” Syrah Resources Limited (ASX: SYR), Talon Metals Corp. (TSX: TLO) and Piedmont Lithium Inc. (Nasdaq: PLL | ASX: PLL) are others that have recently received U.S. grants for their spherical graphite processing, nickel processing, and lithium chemical processing plans respectively. There is also the U.S. loans program office that is looking to support critical metals projects in the USA.

The Louisiana Economic Development (“LED”) organization has already stepped up to support Ucore with a non-binding Letter of Intent (“LOI”) for a 10-year US$9.6 million plus tax incentives package (over the first ten years of operation) in consideration for Ucore’s projected investment of US$55 million for the Louisiana facility. There is also an expedited process for all required state permits.

Closing remarks

Ucore still has several hurdles ahead to achieve their goals, but management appears to be laser focused on the task. With some support already from LED and hopefully from the U.S Federal government the future for Ucore is starting to shape up nicely.

Ucore Rare Metals Inc. trades on a market cap of C$53 million and is cashed up after a recent ~C$4.59 million raise in December, 2022. Stay tuned.




eResearch Report on Search Minerals offers investors a ‘staggering’ volume of information on the rare earths market

Over the years I have lost count of the times I have recommended that public companies secure a research report, simply because I personally love the benefit of third-party analysis and metrics. Toss in an analyst with more financial degrees than most CFOs such as eResearch’s Chris Thompson, and the analysis can prove beneficial to everyone reading the content, including the company and all of us interested in critical minerals. Having followed rare earths company Search Minerals Inc. (TSXV: SMY | OTCQB: SHCMF) (“Search”) for a decade now, the recent eResearch analyst report blind-sided me by the coverage in that it was a staggering 72-page overview, review and historical biography of not only Search Minerals, but a worthwhile read on the rare earths sector.

Now for my notes extracted from my review of the eResearch Report on Search, but again I urge you to access the eResearch analyst report directly to secure any answers you may be ‘searching’ for…

Search Minerals is developing their rare earths projects in Labrador, Canada. Their flagship project is the Port Hope Simpson (“PHS”) Property which includes the Foxtrot resource, Deep Fox resource, Silver Fox, Awesome Fox, and Fox Meadow deposits. The Property is prospective for rare earth elements (‘REE’) Neodymium (Nd), Praseodymium (Pr), Dysprosium (Dy), and Terbium (Tb), Zirconium (Zr) and Hafnium (Hf). Search Minerals plans mining and primary production of the Deep Fox and Foxtrot deposits all going well by 2025 in Labrador and further refining of concentrate into REE oxides and carbonates on the Island of Newfoundland thereafter.

The updated 2022 PEA resulted in a post-tax NPV8% of C$1.31 billion and a post-tax IRR of 41.5%. Initial CapEx was estimated at C$422 million (including a C$61 million contingency) with a mine life of 26 years.

Foxtrot and Deep Fox Resource estimate – 31 December 2021

Source: Search Minerals news April 11, 2022

Search Minerals development timeline plan

Source: eResearch report on Search Minerals p.15

Highlights of the eResearch report (“The report”) on Search Minerals, which was initiated on September 14, 2022:

  • The Importance of Rare Earth Elements (REE) – If you are new to rare earths, this report highlights the many uses of rare earths including their role in the EV sector. Of interest was the quote on page 4: “Neodymium (Nd) is the strongest known magnetic substance and Nd magnets are used in applications that require strong, compact permanent magnets, such as cellular phones, electric motors, hard disk drives, televisions, and medical devices.” Also an interesting point for your next trivial discussion with friends over a glass of wine, is that the smartphone (screen and electronics) contains at least 9 rare earth elements.
  • Search Minerals PEA (2022) Highlights (based on the Foxtrot and Deep Fox Resource)Mine production of 2,000 tpd (720,000 tpa) over a 26-year mine life, including both open pit and underground operations….Underground mining capital in Year 7 of C$54 million is funded from operations….Annual production of approximately 1,437 t of Magnet Rare Earths Oxides (Nd+Pr: 1,291 t, Dy: 125 t, and Tb: 21 t).
  • Key Projects Funded for C2022: Funded for Deep Fox exploration, preparation of 70t bulk sample, and working towards the start of a Feasibility Study.
  • Strong Management TeamManagement has extensive experience, geological knowledge of the region, and are experts in REE processing. Since I know many of the members of this team, I urge you to review the geological team as many in this sector often refer to them as the best in the business, specifically Dr. David Dreisinger whom Jack Lifton and I have used in numerous interviews over the years to help the InvestorIntel.com audience understand the rare earths market.
  • Search Minerals Appears Inexpensive Using Different Valuation Metrics – The Report looked at several different valuation methodologies for Search Minerals. eResearch initiates coverage on Search Minerals and reports a Speculative Buy Rating.

Again, the eResearch report makes for compelling reading and I would encourage anyone serious about investing in rare earths investors to review the entire report.

Most certainly the potential 17x upside (p 5) if Search Minerals succeeds to production is something to consider, especially given the backdrop of forecast shortages of the key magnet rare earths this decade as the EV and wind energy sectors potentially boom. Investors should also consider the various risks that junior miners face as not all will succeed.

Search Minerals Inc. currently trades at C$0.10 with a market cap of C$41 million.

 

Disclosure: The valuations presented in this article are those of eResearch and not InvestorIntel. Search Minerals is a digital media advertiser on InvestorIntel.com and pays for both banner ads and interviews, however, neither eResearch nor Search Minerals have paid for this content.




Ucore Rare Metals is building its rare earths Field of Dreams with RapidSX

To misquote the famous line in the 1989 movie ‘Field of Dreams, “if you build it, they will come” (the actual line from the movie is he will come – referring either to Kevin Costner’s character’s father or shoeless Joe Jackson or perhaps both). Making a giant leap from that to the world we find ourselves in today, where 80% of the worlds rare earth resources are controlled by China, if you build it, or at least can process the raw materials into rare earth oxides (REOs), then arguably everyone will come. OK, maybe that was a bad segue but you’re just going to have to live with it. The point is, there are billions of dollars being invested over the next couple of years on EV battery manufacturing facilities in North America and the U.S. has recently implemented legislation (the Inflation Reduction Act), which requires that 40% of battery components be sourced from factories in the U.S. or its free trade agreement partners, and that Chinese components and minerals be phased out beginning in 2024. On-shoring is the name of the game as we transition to a lower carbon future.

There are numerous rare earth explorers pursuing processing capabilities but perhaps no one is closer to commissioning than Ucore Rare Metals Inc. (TSXV: UCU | OTCQX: UURAF). Ucore is focused on rare- and critical-metals resources, extraction, beneficiation, and separation technologies with the potential for production, growth, and scalability. Ucore has an effective 100% ownership stake in the Bokan-Dotson Ridge Rare Earth Element Project in Southeast Alaska. Ucore’s vision includes disrupting the People’s Republic of China’s control of the U.S. rare earths supply chain through the near-term development of heavy and light rare-earth processing facilities — including the Alaska Strategic Metals Complex in Southeast Alaska. And to that end Innovation Metals Corp., a wholly owned Ucore subsidiary, has developed the RapidSX separation technology resulting in the production of commercial-grade, separated rare earth oxides at the pilot scale.

Sounds promising but what exactly is RapidSX? The process combines the time-proven chemistry of conventional solvent extraction (SX) with a new column-based platform, which significantly reduces time to completion and plant footprint, as well as potentially lowering capital and operating costs. SX is the international rare earth industry’s standard commercial separation technology and is currently used by 100% of all rare earth producers worldwide for bulk commercial separation of both heavy and light rare earths. Utilizing similar chemistry to conventional SX, RapidSX is not a new technology but represents a significant improvement on the well-established, well-understood, proven conventional SX separation technology preferred by rare earth producers. As an investor, I prefer disruption of existing technology versus reinventing the wheel as it is typically more capital efficient and quicker to market, unless of course, it’s cold fusion type of disruption, in which case I’m all ears.

As for the progress of RapidSX, Ucore announced in mid-July that it had upscaled its rare earth Demonstration Plant capabilities and streamlined the RapidSX commercial deployment plan. In early 2022 Ucore received very positive results from the independent RapidSX technology evaluation, including the conclusion that a RapidSX production plant can potentially have a 2/3rds smaller footprint than a conventional SX facility with the same throughput. The team then received buy-in from all stakeholders to expand the design and construction of the Demo Plant. Ucore’s enhanced Demo Plant will be able to process: tens of tonnes of mixed rare earth concentrate on a per annum basis; many feedstock sources, including planned light and heavy rare earth element feedstocks for the Strategic Metals Complexes; and all RapidSX splits required to produce individual praseodymium, neodymium, terbium, and dysprosium. Ucore has planned product qualification trials in Q4-2022 for prospective North American metal/alloy makers and original equipment manufacturers (OEMs).

All this is only one aspect of Ucore’s business, they are also a rare earth explorer with the advanced Bokan-Dotson Ridge rare earth deposit. Highlights at Bokan include a NI 43-101 Preliminary Economic Assessment, with a resource estimate that remains open down-dip and on-strike with further drilling planned. The project can be “near shovel ready” for construction in less than 30 months after receipt of the next stage of development funding. And the Company boasts that Bokan is the highest grade NI 43-101 HREE resource in the U.S. But we’ll save digging further into the details on Bokan for another day.

Bottom line, Ucore is very close to churning out rare earth oxide material at its Demonstration Plant which could lead to supply offtake agreements with EV manufacturers and/or other downstream customers. This could be huge for Ucore in light of the fact that on-shoring is going to be a high priority for the foreseeable future. With a market cap of C$34 million, there could be a bright future for Ucore if all the pieces fall into place.




Market eyes Neo Performance Materials Constantine Karayannopoulos with, what’s next?

August is usually a slow time for business and news as it is the end of the summer holiday season in the Northern hemisphere, but this August has been a particularly busy time for Neo Performance Materials Inc.‘s (TSX: NEO) management team, especially CEO Constantine Karayannopoulos.

Announcements have been coming fast and furious. Let’s start with the most surprising news first:

On August 26th Hastings Technology Metals Ltd (ASX: HAS) announced it was acquiring a 22.1% shareholding in Neo Performance Materials by buying out most of the position of Oaktree Capital Management, L.P. (Oaktree) fund OPPS NPM SARL. Oaktree will sell 8,974,127 shares at C$15/share. Prior to this OPPS held 9,878,155 shares. The funding comes from Wyloo Metals, a private Australian metals company formed by Andrew “Twiggy” Forrest, whose worth is reported at US$17.5 billion. Wyloo will invest the money into Hastings who in turn will acquire the shares from the Oaktree subsidiary.

On the same day as the announcement of the share acquisition by Hastings, a bought deal was announced with Paradigm Capital being the lead underwriter. The deal was done at $15/share. At the time of writing, Neo Performance Materials was trading at $14.25. There are over 40 million shares outstanding so after this deal, there will be 45 million shares. According to the press release the funds will be used for “general corporate purposes including the expansion, maintenance of global assets and the pursuit of strategic growth opportunities around the globe.” Expansion of the operations in Estonia is likely one area for the usage of the funds.  Having visited the plant over a decade ago it is a Soviet era plant which runs nitric acid to separate the rare earths. Neo Performance Materials’ two plants in China use hydrochloric acid. The nitric route is high initial capex as every component is made from stainless steel but has lower opex than the Chinese approach. At a capacity of 3,000 TPY of rare earths oxides the Greenland deposit would produce 750 TPY of Nd/Pr or about 2,500 tonnes of magnets. A nominal size.

This is due to the high prices for the four key magnetic elements, Neodymium, Praseodymium, Terbium and Dysprosium, which hit prices not seen in the past decade. Since then, Nd and Pr have dropped about 50%, Tb 20% and Dy 35%, which means it will be a challenge for Q3 results to match Q2 numbers.

This financing came from Export Development Canada (EDC). The credit facility matures in 5 years and is available in 3 tranches of $25 million. The funds will be used to relocate its rare earth plant in Zibo, Shandong province, China, to a nearby industrial park which will provide access to water treatment and waste/water recycling. This plant produces high value materials for automotive catalytic converters. The relocation is to expand capacity from 4,000 TPY REO to 5,000 TPY REO. Based on reported analysis for Baiyan Obo this expanded capacity will produce 370 tonnes of Nd/Pr oxide which would generate an additional 1,300 TPY of NdFeB magnets.

This is an interesting move by Neo as they only tried to go upstream into mining once before when they got involved in a tin mine in Brazil over a decade ago. The development of this project would provide a source for their plant in Estonia which gets most of its raw material from Russia presently with the balance from Energy Fuels Inc. (NYSE American: UUUU | TSX: EFR) in the USA. The deal is a non-refundable deposit of $250k. Once the Greenland government gives approval for transfer of the license to Neo or its special purpose entity, Neo will pay Hudson Resources an additional $3.25 million. There are two projects in the deal. One is an REE project in SW Greenland and a nearby Nb/Ta. Deposit. The Neo plant in Estonia also produces high purity Nb and Ta metal as well as rare earths so there is synergy in this deal.  The 2011 43-101 report on the REE project showed an indicated resource of 5.9 million tonnes at 1.8% rare earth oxide which translate to about 100,000 of rare earth oxides. It is an underground mine opportunity which will bring added cost to the mining process. Should Neo proceed with this acquisition it will need to develop a camp onsite and decide where to upgrade the ore prior to shipping a concentrate to Estonia – all challenges Canadian companies have dealt with for decades.

If Neo Performance Materials is an indicator for the rare earths sector, one can only wonder what’s next.




MP Materials is riding the rare earths tonnes per year train

MP Materials Corp. (NYSE: MP) emerged from the Chapter 11 of Molycorp and is the only producing rare earths mine in the USA. At one time the in the 1990s it was producing upwards of 40% of the world’s rare earths.  MP has a current market cap of US$5.6 billion, which puts it slightly ahead of Lynas Rare Earths Ltd. (ASX: LYC), which is the biggest producer of separated rare earths outside of China. Combined their market caps exceed the annual revenue of separated rare earths globally.

MP has made some interesting news this year. Q1 revenues of US$166.3 million which is 50% of their revenues from all of 2021. This is due to the high pricing of Neodymium (Nd) and Praseodymium (Pr) in Q1 of this year. Based on Roskill’s report of 2015, MP’s content of NdPr is 16.3% of the total volume. This may vary a little but it is likely to be the two elements that set the pricing for their concentrate as the balance of the materials are of little value. Looking at a basket price, NdPr will account for 93-94% of the total value, assuming all elements were sold which is doubtful as the Chinese have lots of the remaining elements, especially Cerium and Lanthanum. Gross margins in Q1 2022 were 88%, up from 81% in 2021, but I expect this will fall for the balance of the year as NdPr prices are now 20-25% lower than Q1 peaks. Either way, MP is poised to improve its Net Income to US$168.4 million. MP has done a good job in their sales price to China for their concentrate. I calculate they are getting somewhere in the range of 40-50% of market value, which is high versus traditional pricing for concentrate which I have seen at 25-30%.

In April a definitive supply agreement was announced between MP Materials and GM to supply rare earth alloy and magnets for GM’s EV program. This is significant as it would restore NdPr rare earth metal, alloy and magnet production. The USA does produce Samarium Cobalt magnets but these are typically used in military applications. There is no indication on what technology will be used to produce the metal, which in China is a messy process. Planned capacity is 1,000 metric tonnes of NdFeB magnets. This will require 280-300 tonnes of NdPr. The previous Molycorp plant was designed to produce 20,000 tonnes of REO of which NdPr would account for over 3,000 tonnes.

This does leave the question as to where MP will sell the remaining NdPr. Europe has one metal/alloy producer and one magnet producer, and Japan is the other logical market, but Lynas owns 80% of the Japanese market and has a shorter supply line. What is left is China. Also to supply other US car producers MP would have to expand capacity, and it is not clear what limits or exclusivity GM has with MP Materials.

The challenge is that the original plant was designed as a single train of 20,000 tonnes per year. Nowhere in China is there a single train much larger than 5,000 tonnes per year (TPY). Lynas built four 5,500 TPY trains. This allows flexibility should there be issues like reduced demand during COVID where one or two trains can be shutdown to allow matching with demand, or if one train has operational issues. I would expect that MP, with the input from Shenghe Resources (a related party of MP whose ultimate parent is Shenghe Resources Holding Co., Ltd., a rare earth company listed on the Shanghai Stock Exchange, and as of its March 31, 2022 quarterly report, a buyer of MP’s rare earth concentrate that accounted for more than 90% of MP’s product sales), will reconfigure the plant to be more flexible. Also MP, like anyone else, will not go from zero to 20,000 TPY overnight. There will be a qualification process and time to acquire accounts so multiple trains makes sense as one penetrates a market as they can be brought on as the business grows.

The other news was that the US Department of Defense (DOD) granted MP $35 million to build a heavy rare earths at Mountain Pass. I find this interesting as Mt. Pass has 98.6% of its content in light rare earths. This would mean at a run rate of 20,000 TPY the total output of the heavy rare earths would be 280 TPY. The only real valuable heavy rare earths are Terbium (Tb) and Dysprosium (Dy) which would total about 10 TPY combined. At today’s pricing, which for Tb is high, in my opinion, this plant would generate revenues of $10-11 million per year.

Overall MP has been doing well – selling concentrate to China. What will happen to profits as they move downstream only time will tell.




Search Minerals moving forward with growing rare earths resource, new PEA and a commercial magnetic separation plant

It has recently been reported that the U.S. Government (subject to approval of the proposal) is likely to widen their definition of “domestic source” in the Defense Production Act to include the United Kingdom of Great Britain and Northern Ireland and Australia. This is in addition to the current inclusion of Canada and of course the USA. If passed, this is great news for critical material miners located in these countries.

One such company is focused on the high value magnet rare earths and is advancing their project in Canada. Magnet rare earths prices, such as neodymium, have increased very significantly over the past year as EV demand surged.

Search Minerals Inc. (TSXV: SMY | OTCQB: SHCMF) (Search) is developing their rare earths projects in Labrador, Canada. Their three projects include:

  • The Port Hope Simpson (PHS) Property (flagship) – Includes Foxtrot, Deep Fox, Silver Fox, Awesome Fox, and Fox Meadow deposits. Prospective for Neodymium (Nd), Praseodymium (Pr), Dysprosium (Dy), and Terbium (Tb), as well as Zirconium (Zr) and Hafnium (Hf). The updated 2022 PEA is due soon in Q2, 2022.
  • The Henley Harbour Area in Southern Labrador.
  • The Red Wine Complex located in Central Labrador.

Search Minerals PHS Property showing the Foxtrot & Deep Fox deposits and other targets

Source: Search Minerals website

Search’s flagship PHS Property has been the Company’s focus with a PEA completed in 2016 on Foxtrot only, an updated Resource recently released (now includes both Foxtrot & Deep Fox), and an updated PEA to follow very soon. Given the larger resource (hence potentially longer mine life) and higher rare earth prices, the upcoming 2022 PEA is expected to potentially improve significantly on the 2016 PEA. Search President & CEO Greg Andrews, discusses the positive impact on their upcoming PEA in a recent InvestorIntel video here.

Details of the updated resource at Foxtrot and Deep Fox

As a result of the recent updated resource news the Foxtrot resource has grown by approximately 60% from the 2016 estimate and the Deep Fox resource has grown by 25% from the 2019 estimate. Search state in their April 11, 2022 resource announcement: “Revenue attributable to Pr, Nd, Dy, and Tb represent approximately 92% of the total revenue.”

Estimated Mineral Resources for the FOXTROT and DEEP FOX Projects as of December 31, 2021

Source: Search Minerals announcement on April 11, 2022

Both Foxtrot and Deep Fox Resources include open pit (OP) and underground (UG) components as shown on the models below. They will form the basis of the upcoming updated 2022 PEA. In both cases, mineralization remains open at depth.

Models showing the open pit and underground resource at Foxtrot and Deep Fox

Source: Search Minerals announcement on April 11, 2022

Next steps (including steps towards a full commercial magnetic separation plant)

The next steps for Search at their PHS Property will be the 2022 PEA release, further drilling to grow the resource (including at Fox Meadow), and further advancements with off-take agreements. In 2021 Search signed a non-binding MOU with USA Rare Earth LLC for the future delivery of a rare earth mineral concentrate supply containing 500 tpa of NdPr. The MOU also included a plan to expand the collaboration to include discussions regarding separation, marketing, and offtake of a portion of the future production at Search’s Deep Fox and Foxtrot deposits. There will also be the upcoming results from Search’s magnetic separation program using bulk samples from the PHS Property (Foxtrot & Deep Fox). The results of the testing will be used as part of a ‘scale up’ to a full commercial magnetic separation plant.

Search President & CEO, Greg Andrews, states: “We continue with our “Sprint to Production” and this is a very important step to scale up and produce more material for further separation into individual oxides of the permanent magnet material, Neodymium (Nd), Praseodymium (Pr), Dysprosium (Dy) and Terbium (Tb). These are the key elements which create the value in the rare earth element supply chain. Upon producing the oxides, Search will demonstrate the transformation of the permanent magnet oxides into metal.”

Closing remarks

Last month Search released a significant Resource upgrade at Foxtrot and Deep Fox deposits on their PHS Property. The results were strong growing the resources by 60% and 25% respectively. Both remain open at depth and the PHS Property has numerous other exciting rare earth targets such as Silver Fox, Awesome Fox, and Fox Meadow. This means the PHS Property should potentially continue to further grow the total resource size in years to come. Search did recently release encouraging assay results at the Fox Meadow target where Search plans to commence a 6,000 m drill program this fall.

The big next catalyst for Search is the upcoming updated 2022 PEA which should potentially see a significant improvement on the 2016 PEA. Following that it will be interesting to see Search’s progress towards becoming a rare earths miner as well as processor.

Search Minerals trades on a market cap of C$65 million.




Ucore targets to fill the processing gap in a Western rare earths supply chain by 2024

As most investors familiar with the critical materials sector know, China currently dominates the space, especially in downstream critical materials ‘processing’. This leaves the Western world very vulnerable to supply chain interruptions that can threaten the supply of end-user products such as electrical and electronic components, electric vehicles, wind turbines, solar panels, and/or military systems.

Today’s company, Ucore Rare Metals Inc. (TSXV: UCU | OTCQX: UURAF) (Ucore), is working to bridge that gap, domestically, and become a USA ‘processor’ first of the rare earths, and ultimately of other key critical materials. They also plan to be a vertically integrated individual, separated, heavy rare earths producer.

Ucore is focused on initially developing an Alaska-based Strategic Metals Complex (SMC) rare earths’ central processing facility with commissioning targeted for 2024. After that Ucore plans to develop its own magnet rare earths’ deposit located on Bokan Mountain on Prince of Wales Island, Alaska. The ultimate plan for Ucore is to have their Bokan-Dotson Ridge REE Project – containing the heavy rare earths’ Dysprosium (Dy), Terbium (Tb) & Yttrium (Y) – feed their first, Alaska located, SMC processing facility. The underlying technology for this and other planned SMCs is the RapidSX™ REE separation technology platform, which will be operated by Ucore’s wholly owned subsidiary, Innovation Metals Corp. (IMC).

Ucore plans to fill the processing gap in creation of a Western rare earths supply chain with their SMC facilities

Source: Ucore news January 2022

A key part of getting the Alaskan SMC processing facility up and running is to secure material supply agreements. The facility will have an initial 2,000 tpa total rare earth oxide (TREO) separation and purification capacity, ramping to at least 5,000t/year TREO by 2026.

Feedstock agreements are progressing well for Ucore’s planned Alaskan SMC processing facility

In October 2021 Ucore signed a non-binding Memorandum of Understanding (MOU) with Vital Metals Limited (ASX: VML | OTCQB: VTMXF) for the supply of a mixed rare earth carbonate, beginning H1 2024. The deal is for “Vital to sell to Ucore a minimum of 500t REO (ex-cerium)/year, commencing H1 2024. Vital to expand production to support a minimum of 50% of Ucore’s envisioned 5,000t TREO/yr processing capability by 2026.”

It also was announced last week on April 20, 2022, that Ucore and Germany’s ThyssenKrupp Materials Trading had executed a feedstock supply MOU for the Alaska SMC. Under the MOU “ThyssenKrupp Materials Trading is expected to begin the supply of a minimum of 1,000 tpa of mixed rare earth carbonate to Ucore in 2024 for ten years.” The announcement also states that the non-binding MOU allows for increasing quantities in subsequent years and that the two parties will work towards a 10-year binding contract.

The above MOU is a great achievement and positive endorsement for Ucore, as ThyssenKrupp Materials Services is the biggest mill-independent materials distributor and services provider in the Western world with around 380 locations, in more than 30 countries.

The loud and clear message for investors is that Ucore is putting together a North American individual rare earths supply chain from mixed rare earths carbonate (concentrate) all the way to the final product of separated individual rare earth oxides, used to make rare earth metal alloys (including magnets) such as those required for many critical and green energy products. It will be a key initial step for the USA to gain rare earths processing independence from China, which currently dominates the sector.

Ucore is also developing processing technology for other critical metals in Ontario

As announced on April 19, 2022 Ucore is improving the management and technical team for their Ontario RapidSX™ Commercialization and Development Facility (CDF). The demonstration plant construction is ongoing and is scheduled for commissioning in mid-2022.

What I find most interesting is that Ucore is also working on nickel laterite ore processing technologies as well as lithium-ion battery recycling, including working with clients such as Li-Cycle Holdings Corp.

Full details on Ucore’s 2022 plans can be read here and include:

  • A commercial demonstration plant for their RapidSX™ technology in Ontario.
  • Development of the Alaska SMC Project.
  • Exploring the potential of developing an SMC in Canada.
  • Accelerating the development of the Bokan Project as a vital US supply chain component to provide a long-term secure source of HREEs; the most expensive and scarce inputs of the permanent magnet alloys.

Ucore’s business summary – Includes a target for construction of the Alaska SMC by 2023, subject to finance

Source: Ucore Rare Metals Inc. website – Alaska 2023

Closing remarks

The Western world needs to develop its own complete end-to-end supply chains for critical strategic metals. In the case of rare earths, Ucore is advancing well and steadily moving towards becoming a U.S. individual separated rare earths producer by 2024, all going to plan. Of course, investors should remember these dates are the best guide from the company only and are subject to variables such as successful funding.

Ucore Rare Metals Inc. trades on a market cap of C$37 million. Ucore still has a long way to go with several hurdles and risks ahead, partially explaining the very low market cap. Still, if they succeed the potential reward could be significant.




Leading rare earths junior Appia adds a new uranium claim block to their expanding asset portfolio

Two of the best-performing commodities in the past year have been the key rare earth magnet material blend, neodymium, praseodymium (NdPr), and the energy metal, uranium. Today’s company has established itself as a leading rare earths junior in Canada, but recently changed its name and expanded its uranium portfolio. This means investors get exposure to both the key magnet rare earths and also uranium. Even better, it controls 3 projects/properties.

The Company is Appia Rare Earths & Uranium Corp. (CSE: API | OTCQB: APAAF) (Appia) formerly known as Appia Energy, with its Alces Lake rare earths project and its newly acquired uranium mineral claim block (Otherside), as well as other uranium properties located in Northern Saskatchewan, Canada, and its Elliot Lake uranium and rare earths property in Ontario, Canada.

Appia’s very high-grade rare earths project at Alces Lake

For background on Appia’s rare earths projects you can read some past articles here which focus on Appia’s tremendous asset at Alces Lake, Canada which has the 2nd highest average rare earth’s grade in the world, at 16.65 wt% TREO. High-grade zones are up to 49 wt% TREO. The rare earths are hosted in favorable ‘monazite’ ore at or near surface spread over 27sq km of tenements. There is a 23-25% Critical Rare Earth Oxide (CREO) component, including neodymium (Nd), praseodymium (Pr), dysprosium (Dy), and terbium (Tb).

Appia’s 100% owned Alces Lake Project has the world’s second highest average grade of TREO

Source: Company presentation

Appia has access to use the Government funded Saskatchewan Research Council (SRC) processing facility in Saskatoon, Canada. Existing pilot facilities there(1,000 tpa capacity) have already optimized a monazite processing flow sheet for Appia. The SRC production-scale processing facility is expected to be partially operational in early 2023.

Appia plans a smaller surface and near-surface operation to start production with an open-pit scenario which is easier to permit and manage and should have a low CapEx/Opex.

Appia’s latest results include:

  • Drill results at Wilson North (Alces Lake) with average 17.5 wt% TREO over 9.38 metres with up to 37.9 wt% TREO.
  • High grade REE mineralization identified over an estimated 27 square kilometre area. Channel sample of 14.71 wt % TREO from Sweet Chili Heat and 11.94 wt % TREO from Diablo. 10.35 wt % TREO returned from grab sample at Zesty. 7.86 wt % TREO returned from grab sample along the Oldman River trend. New discovery of REEs with 2.27 wt % TREO grab sample from “Train Domain”. Elevated critical electronics metal, Gallium, values have also been returned for all samples enriched in TREO.
  • Promising Results from Initial Metallurgical Tests on a Composite Sample from Alces Lake. Laboratory heavy liquid separation tests recovered 95% of the total rare earth oxide (TREO). Appia President Frederick Kozak stated: “TREO recoveries and the percentage of TREO in concentrate are comparable to other producing global rare earths projects, supporting the potential for Alces Lake as a future monazite rare earths supply.”

Appia is waiting on further drilling core and channel sample assay results from the 2021 program. In terms of major near-term catalysts, Appia states: “Analysis of 2021 drilling and assays may lead to NI 43-101 report early 2022.”

Saskatchewan Uranium Properties

Appia recently announced that they significantly increased their uranium claims by acquiring the Otherside claim block of 27,291 contiguous hectares. Appia states: “The claims were staked on the basis of similar geological and geophysical signatures to the Company’s Loranger property as well as other known high-grade, large-tonnage uranium deposits in the Athabasca Basin including Fission Uranium Corp’s Triple R deposit, NexGen Energy’s Arrow deposits and others.”

Appia now owns 4 uranium properties/claims over a total of 69,344 hectares – Loranger, North Wollaston, Eastside, and Otherside. The properties are well located with proximity to infrastructure such as roads, highway, powerline, an airstrip as well as two uranium mills. The properties are ready to explore, with at or near-surface high-grade uranium, no sandstone cover, and negligible overburden.

Saskatchewan Uranium Properties – Loranger, North Wollaston, Eastside, and Otherside

Source: Company news January 10, 2022

Appia stated on January 10, 2022 that the next steps are: “Appia has commenced the permitting process for a winter drilling program on the Loranger property and anticipates commencement of drilling in approximately one month, depending on weather and permits. The Company is fully funded for this program.”

Elliot Lake (Ontario, Canada)

Appia also has a 100% interest in 12,545 hectares (31,000 acres), with rare earth element and uranium deposits over five mineralized zones in the Elliot Lake Camp, Ontario. The Resource details are shown in the table below.

Source: Company presentation

Closing remarks

Appia is becoming a significant rare earths and uranium junior. Appia now owns three very promising projects – Alces Lake (very high grade and critical rare earths), Saskatchewan Uranium Properties (Loranger, North Wollaston, Eastside, and Otherside), and Elliot Lake (rare earths & uranium).

Appia trades on a market cap of C$54 million.




Search Minerals is looking pretty foxy for 2022

All I want for Christmas is money, is what Search Minerals Inc. (TSXV: SMY | OTCQB: SHCMF) must be saying after it recently announced plans to re-stock the treasury with a $15 million non-brokered private placement offering. For a Company with a market cap of roughly C$69 million prior to the closing of this share issuance, that seems like a pretty good Christmas present. I’m sure there are a few other items on their Christmas wish list but things have been going along fairly well for this rare earths explorer in Newfoundland and Labrador.

As background, Search Minerals is focused on creating value through finding and developing rare earth mineral assets in SE and central Labrador, Canada. The Company is the discoverer of the Port Hope Simpson – St. Lewis Rare Earths District, a highly prospective belt located in southeast Labrador that is 62 km long and up to 2 km wide. Search owns 100% of two advanced rare earth resources called the Foxtrot Project and Deep Fox Project, and the more recently announced Foxtrot-like prospects Fox Meadow, Silver Fox and Awesome Fox. In addition, the Company has identified more than 20 other Foxtrot-like prospects in the District. Several of the Foxtrot-like prospects require exploration drilling programs and may provide additional resources to a central processing facility that would be situated within the District.

The interesting thing about Search is that they have a little more going on than just exploring for rare earths. The Company has developed a breakthrough technology for the processing of its material called the Patented Direct Extraction Metallurgical Process. With the mining of many commodities, it’s not as simple as taking the rock from the ground, crushing it up and sending it to market, and the mining of rare earths can create their own environmental nightmare if not addressed properly. Fortunately, Search has found an elegant answer with an environmentally conscientious solution for managing waste residue that also significantly reduces CAPEX and operational costs along with eliminating unnecessary steps, lowering capital and operating costs and producing a dry stackable waste residue that reduces the environmental footprint, pilot plant testing has clearly demonstrated the ability to produce a high purity mixed rare earth oxide (REO) concentrate. You can read more about the process here, but this could be a big deal.

On the exploration front, Search had over 6000 assays from its 7000m drill program at Deep Fox that were reported Nov 15th with all 38 drill holes showing significant rare earths throughout the mineralized zone and mineralization observed in all levels (25m, 50m, 100m, 150m, 200m). At Fox Meadow, 500m of channel sampling work has been completed and samples are being logged and prepared for shipment to the assay laboratory in preparation for a preliminary drill program in 2022. Additionally, Silver Fox is drill ready for 2022 and the Company is preparing a preliminary drill program there as well. Lastly, the Deep Fox drill data will be used to prepare a new resource estimate which will be incorporated into an upcoming preliminary economic assessment report expected in Q1 2022. The combination of the Deep Fox and Foxtrot resources will potentially allow for an increase in the production rate compared to the 2016 PEA on Foxtrot alone. Especially given assays from Deep Fox have shown higher grades of the key rare earth elements used in the permanent magnet market (Neodymium, Praseodymium, Dysprosium and Terbium) as compared to Foxtrot.

It has been an exciting few months for Search Minerals hence my suggestion that its Christmas wish list might be a relatively brief one. Maybe one wish is for a short, mild, winter so they can get back to drilling sooner than later after they replenish the bank account. Nevertheless, with the US, Canada and EU collaborating to build a secure rare earth supply chain, Search Minerals is in the right jurisdiction to participate in breaking global reliance on China. Assuming they are successful in raising the full $15 million the Company will be in great shape to hit the ground running to start 2022.

Perhaps I’ll finish the year with a bad pun before I wish everyone a happy and safe holiday season, but to me this looks like a pretty foxy investment. I hope they’ve at least seen a fox or two on their exploration properties.

Merry Christmas everyone and see you in 2022!




One of the world’s richest rare earth deposits continues towards resolution of issues with Burundi partner

Rainbow Rare Earths’ production in Africa to be expanded through extraction from South African mine tailings.

When it comes to rare earths it is important to identify the most valuable ones. Rare Earth permanent magnet production accounted for 91% of the total monetary value of rare earth consumption in 2019, and neodymium and praseodymium (NdPr) are the two key rare earth elements used in permanent magnets, particularly neodymium. This explains why most rare earth miners target NdPr. They are simply the most in demand and are highly valuable.

Rainbow Rare Earths Limited (LON: RBW) (“Rainbow”) is a rare earths miner targeting NdPr production at their two African rare earth projects. Rainbow’s strategy is to become a globally significant producer of magnet rare earths. Rainbow has two African-sited projects, each of which has a special attribute leading to potentially lower cost mining. Rainbow also has exclusive rights, across the SADC region of Africa, to privately owned American specialty chemical engineering company’s (K-Tech) rare earths continuous ion chromatography separation technology. The K-Tech process targets individual separation of rare earth from natural mixtures in fewer stages with more flexibility than traditionally used solvent extraction thereby saving on upfront CapEx and ongoing OpEx and potentially producing a higher end-value separated oxide rather than a carbonate. Testing is ongoing.

Rainbow’s two rare earths projects are:

The Phalaborwa Project (70% earn-in agreement)

The Phalaborwa Project comprises an Inferred Mineral Resource estimate of 38.3Mt at 0.43% Total Rare Earth Oxides (TREO) contained within gypsum ‘tailings’ stacked in unconsolidated dumps derived from historic phosphate fertilizer hard rock mining. Being a tailings resource eliminates the need for hard rock mining, which is expected to lead to lower operational costs. The Resource has a high-value NdPr content representing 29.1% of the total contained rare earths, measured as oxides, with economic dysprosium and terbium, key rare earths for high temperature operation of permanent magnets, as valuable by-product credits. The Project has 5-10 times higher grade NdPr than a typical ionic clay style rare earth deposit (see table below). It also has low levels of radioactive elements which means easier processing and lower costs.

Being on the site of a past mining operation, the Phalaborwa Project has excellent infrastructure and transport logistics. The Project is largely permitted and positioned in an established mining region.

The Gakara Project (90% interest)

Rainbow states that “the Gakara Rare Earth Project is one of the world’s richest rare earth deposits.” Rainbow has a 90% interest in the Gakara Project with a non-dilutable 10% owned by the Burundi State. The mining permit covers a large area of over 39km2 and has a 25-year mining license that began in March 2015.

Gakara was placed on care and maintenance in June 2021 at the request of the Government of Burundi. Primary concerns of the Burundi Government are understood to relate to the pricing of the mineral concentrate currently sold under a long-term off-take agreement with a German company’s (ThyssenKrupp), trading arm. Rainbow states: “Rainbow continues to engage constructively with stakeholders to resolve the issue and allow trial mining to recommence as soon as possible.”

Closing remarks

Rainbow has two exciting African rare earth projects.

The Phalaborwa Project has several advantages including:

  1. An ore tailings source, so no need for hard rock mining, crushing, or milling and hence lower production costs.
  2. High-value Nd and Pr oxide content representing 29.1% of the total contained rare earth oxides, with low levels of radioactive elements, and 
  3. An existing mining site with great infrastructure and logistics available.

The Gakara Project has outstanding NdPr grades in visible “veins” and is amenable to simple physical separation of minerals from waste rock to produce a high value rare earth concentrate. This makes for a low OpEx project. The Project is currently on care and maintenance pending the expected resolution of certain legal issues with the government of Burundi.

Risks are typical of those for junior rare earths miners including funding risk and in this case, sovereign risk in Africa.

Rainbow Rare Earths Limited trades on a market cap of £ 78 million (~US$105 million). One to follow with great interest.