Wednesday, 29 June 2011

While the rest of the world fast track rare earth research and processing, Malaysia Government still grapples with its Oppo on safety issues

Some tit bits on rare earth news from overseas:

Rare-earth oxides facility opens in U.S.
June 28, 2011 by Paul Dvorak

Here's where rare earth elements work in autos.

Molycorp Inc. just announced that it has secured the final funds necessary for the capital build-out of its estimated $781 million expansion and modernization project at its flagship rare-earth oxides facility at Mountain Pass, California. The first phase of its mining project is expected to be operational by next year.

The development is significant because of the growing use of REEs in small yet high power motors and generators, especially the PM generators used in wind turbines. When completed, it will be the first time in a decade that rare-earth oxides are produced in the United States, which once lead the world in such production. Today, 95% of the rare-earth metals needed for today’s technologies are extracted in China.

When Phase 1 of the project completes, sometime in 2012, Molycorp says its manufacturing assets will comprise the world’s first fully integrated rare earth manufacturing supply chain, producing high-purity rare earth oxides, metals, alloys, and neodymium-iron-boron (NdFeB) permanent magnets, widely used in generators, transportation, defense, and other industries.

A decade ago America was the world’s largest producer of rare-earth metals according to a report in The Economist. But the open-cast mine at Mountain Pass, California, closed in 2002—mostly due to China’s lower labor costs. The country recently began limiting exports to keep the country’s own high-tech industries supplied. By one account, the material exceedes $140/lb.

What are Rare Earth Metals?
Source: Mother Nature Network, Russell McLendon (6/23/11)
"You're probably using some right now."

Mother Nature Network, Russell McLendon

Crucial to electric vehicles (EVs), wind turbines and many other green-tech innovations, these elusive metals aren't as rare as they sound; in fact, you're probably using some right now. Key to a variety of everyday devices, from tablet computers and TVs to hybrid cars, so it may be encouraging to know several kinds are actually common. Cerium, for example, is the 25th most abundant element on earth.

So why are they called "rare" earth elements (REEs)? The name alludes to their elusive nature, as the 17 elements rarely exist in pure form. Instead, they mix diffusely with other minerals underground, making them costly to extract.

A Rare Breed

Much of the rare earths' appeal lies in their ability to perform obscure, highly specific tasks. Europium provides red phosphor for TVs and computer monitors, for example—and it has no known substitute. Cerium similarly rules the glass-polishing industry, with "virtually all polished glass products" dependent on it, according to the USGS.

Permanent magnets are another big role for REEs. Their light weight and high magnetic strength have made it possible to miniaturize a wide range of electronic parts, including many used in appliances, audio/video equipment and military gear. Innovations like small, multigigabyte DVD drives likely wouldn't exist without rare earth magnets, which are often made from a neodymium alloy, but may also contain praseodymium, samarium, gadolinium or dysprosium.

While producing rare earths can cause environmental problems, they have an eco-friendly side, too. They're vital to catalytic converters, EVs and wind turbines, as well as energy-efficient fluorescent lamps and magnetic-refrigeration systems. Their low toxicity is an advantage, too, with lanthanum-nickel-hydride batteries slowly replacing older kinds that use cadmium or lead. Red pigments from lanthanum or cerium are also phasing out dyes that contain various toxins.

Oil Supply Impacts Demand for Rare Earth Stocks
On Tuesday June 28, 2011, 6:48 am EDT

The recent release of 60 million barrels of oil (NYSE:USO) will artificially lower the price. High oil prices has been the best catalyst for clean energy production and fuel efficient vehicles. Increasing the supply of oil may be pushing down the demand for rare earths (REMX), uranium (URA) and lithium (LIT) only short term. This decline in oil prices should not drastically hurt the development of rare earth assets outside China (NYSE:FXI).

Over the long term oil prices will return to equilibrium as the new supply is absorbed by the market. Demand for fuel efficient vehicles will continue to soar. Rare earths and lithium stocks have pulled back and are significantly discounted. However, this may change shortly.

Gold Stock Trades received a significant letter from Governor Sean Parnell of Alaska recently, in which he wrote to Energy Secretary Steven Chu that, “The federal government simply cannot afford to sit on the sidelines as other countries move aggressively to develop new mines…” The Governor proposes an immediate initiative combining federal and state government in the speedy development of Alaska’s vital rare earth resources.

Washington was beginning to wake up about the rare earth (REMX) crisis affecting our most critical industries. It is apparent that the West will not be relying on trade sanctions alone to counter China’s export cuts of critical rare earths. Artificially lowering the price of oil is only a short term move and the U.S. must move fast to find alternative energy sources. Rare earth assets in the U.S. must progress rapidly or domestic high end users such as Apple (NASDAQ:AAPL) and General Motors (NYSE:GM) may face supply shortages.

In 2012, the President has set aside funds to create a rare earth research hub. It is being modeled after the famous “Manhattan Project” where top scientists will be brought together to develop a rare earth supply chain. This will consist of targeting the top domestic development projects and creating a separation facility to manufacture the ore into a final product. This could potentially be a tonic to many of the North American rare earth miners who are developing the assets but need the government’s assistance to subsidize refining and separating capabilities.

In an article I wrote on April 8th, I mentioned that “Colorado Congressman Mike Coffman introduced the Rare Earth Supply-Chain Technology and Resource Transformation (RESTART) Act of 2011, which will give loans to the industry and speed up permitting.”

These initiatives from Washington have been long overdue. The U.S. needs to recapture this industry co-opted long ago by China. Fortunately important forces in the U.S. are beginning to take action to regain the high ground.

The Bin Laden Mission was a prime example of unintentionally revealing to the world one of the many uses of rare earths in top secret technologies. For the first time, the public became aware of the existence of a stealth helicopter. Stealth technology depends on rare earth oxides. The rare earths absorb the oppositions laser wavelengths to avoid detection. We are witnessing only one of many hitherto unknown applications. Imagine the plethora of rare earth developments that await mankind.

One can now begin to comprehend the significance of Congressman Mike Coffman’s urgency in stressing the importance of fast tracking the production of rare earths for our national security. No better example of this can be the presence in our own country of an indigenous mother-load of a rich rare earth assets. Read in full here.

Back home in Malaysia, while America and the rest of the world are fast tracking research and reopening  rare earth processing plants, here in Malaysia the Federal Government is being attacked by Opposition bent on closing down the Lynas high tech rare earth processing plant in Gebeng, Kuantan. Sigh.

No comments: