Canada could become a key supplier...Canada could become a key supplier of rare earth metals for high-tech devices
By: LuAnn LaSalle, The Canadian Press
Posted: 23/10/2010 5:04 AM|
MONTREAL - Flat screen TVs, laptops and Apple's iPhones all use rareearth metals, critical to tech devices but largely controlled andproduced by China.
It's a market that a number of Canadian companies are trying to enterwith their own mining properties in order to compete with andpotentially take away market dominance from China.
"The market is only now catching up to the understanding of the sheerimportance of these metals," said Peter Cashin, president and CEO ofQuest Rare Minerals Ltd. (TSXV:QRM).
Besides TVs, computers and mobile phones, rare earth metals are alsoused in wind turbines, in iPod ear buds for sound quality, in hybridelectric cars' motors and batteries, and in smart bombs and otherdefence applications.
China controls about 97 per cent of the production of rare earth metalsand has cut back on exports to meet domestic demand and help cutpollution. Japan has been already squeezed in its supply of these metalsdue to a dispute with China and said Friday it plans to mine for themin Vietnam in a bid to reduce its dependence on the economic powerhouse.
Cashin said he expects to have Quest's Strange Lake property innortheastern Quebec, near the Labrador boundary, in production by 2014or 2015. He's also interested in finding a partner to refine the metals.
He said there's enough rare earth metals, both light and heavy, at theQuebec property for an estimated 65 to 100 years of production.
"That speaks very well to the security of the supply that's got theUnited States and other western governments concerned about theirability to obtain those important rare earths," he said.
Though they're called rare earth metals and may have been considered sowhen they were discovered at the end of the 18th century,they're notactually rare or in short supply.
They're a group of 17 similar metallic elements whose names aren'texactly common to everyday vocabularies, such as cerium,terbium,dysprosium and neodymium.
So-called "heavy" rare earth metals are particularly sought afterbecause they're critical to the production of magnets found in windturbines, computer hard drives and electric motors, and can toleratevery high temperatures.
Analyst Jack Lifton said the Chinese have cut back on production becausethey have to meet their own domestic demand and they're worried they'regoing to run out of the metals.
Lifton said Canadian companies could be the closest to producing analternate supply of "heavy" rare earth metals, citing Saskatchewan-basedGreat Western Minerals Group Ltd. (TSXV:GWG) as an example.
"The world is waiting for a Canadian company to start producing heavyrare earths," said Lifton, founding principal of Technology MetalsResearch in Detroit.
"The heavy rare earths are critical to the production of modern magnets that can operate at high temperatures."
Great Western has a mine in South Africa that's expected to be up andrunning in 2013, said James Engdahl, president and CEO. A separationfacility for the metals is also planned, he added.
"By 2013 when we're in production, we see ourselves growingsubstantially," Engdahl said, adding that the company may make anacquisition or two.
"We believe the potential in South Africa to produce may be as much as10,000 tonnes a year is very realistic," he said from Saskatoon.
Engdahl said the mine will be able to produce the in-demand "heavy" rare earth metals.
Great Western, which also processes the metals, has been buying themfrom China for 18 years. But Engdahl said the company also processesrare earth metals in England and Michigan.
"We are the only ones that make alloys basically outside Asia," he said.
Lifton said he also likes Avalon Rare Metals (TSX:AVL),but he said itwill be financially challenging for the Toronto-headquartered company toget the heavy earth metals out of the ground due to infrastructurecosts at its property in the Northwest Territories.
"If they can do that, Avalon will become the world's premier supplier ofthe world's heavy rare earths and the Chinese will buy from them andeverybody will be happy."
Engdahl said rare earth metals have changed everyday life and "miniaturized" devices.
"If you went back to the '60s and you had a big black-and-white TV,that's what the world would be like without rare earth magnets in them."