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Geomega Resources Inc V.GMA

Alternate Symbol(s):  GOMRF

Geomega Resources Inc. is a mineral exploration and evaluation company focused on the discovery and sustainable development of economic deposits of metals in Quebec. The Company is a developer of clean technologies for the mining, refining, and recycling of rare earths and other critical materials. Through its wholly owned subsidiary Innord Inc. (Innord), the Company is developing innovative technologies for extraction and separation of rare earth elements and other critical and strategic metals from its mining properties and other mining and industrial waste in an environmentally sustainable way. With a focus on renewable energies, vehicle electrification, automation and reduction in energy usage, rare earth magnets or neo-magnets (NdFeB) are at the center of all these technologies. The two most advanced projects for the Company are the rare earth magnet recycling and bauxite residue processing and vaporization. It also owns the Montviel rare earth carbonatite deposit.


TSXV:GMA - Post by User

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Post by miner49er2on Mar 08, 2011 11:14am
244 Views
Post# 18251026

Chinese Env Regs Will Change REE Industry

Chinese Env Regs Will Change REE Industry

fyi
https://resourceinvestingnews.com/13687-chinese-environmental-regulations-will-change-rare-earth-industry.html

Chinese Environmental Regulations Will Change Rare Earth Industry

March 7, 2011 @ 6:01 pm In Feature Articles

By Michael Montgomery—Exclusive to Rare Earth Investing News[1]

[2]The rare earth market has been dominated by China, and more importantly, the changes to China's mining and export policy. During 2010, the fierce cutbacks to exports and clamp downs on small and illegal mining operations brought media attention to both rare earth and strategic metals. The changes to exports lit a fire under governments and corporations to secure the these crucial elements needed for their business and national security needs. Last month Chinese officials stated that drastic changes to the rare earth industry were in the works, and reassuring that export quotas would be ‘reasonable.' Those with intimate knowledge of this market know this statement to be less than sincere. Some of the changes to the policy have now been made public.

Details over the environmental regulations were released from the Ministry of Environmental Protection. The details include, for example, the limit for ammonia nitrogen content at 25 mg per liter of water for existing rare earths companies beginning Jan.1 2012. The current limit ranges from 300 to 5,000 mg per liter of water. This sharp reduction and new found desire for environmental protection will change the face of the Chinese rare earth industry. The smaller firms may not have the ability to upgrade their processing facilities to keep up with the changes, which only become more stringent in 2014.

“To small and medium enterprises in the rare earth industry, the new standards will make them suffer and even die out, given their capital and technological limits,” stated Tan Wanli[3], Chief Engineer of the Heli Rare Earth Smelting Co.

The larger firms able to cope with the changes will slowly build their power, buying out their smaller competitors. This consolidation in the industry is something that the Chinese government stated in September[4] of 2010, these new regulations may help that process along.

“The rules will drive the small and medium rare earth enterprises out of the industry or to be merged with big players and thus promote the industry consolidation," said Lin Donglu, secretary general of the Chinese Society of Rare Earths.

The environmental protections are the only accepted non-tariff barrier to trade under WTO trade policy. The move by the Chinese not only consolidates their industry, but avoids a trade dispute. Talks of Europe, Japan and the US bring a trade dispute with the WTO over rare earth policy gained traction when a preliminary report concluding that China has no legal right to impose export restrictions[5] on nine raw materials, said trade diplomats and lawyers.

The changes to China's rare earth strategy have sparked motivation to secure non-Chinese rare earth supply of REE's. South Korea stated that the nation plans to increase its strategic reserves of rare earths to provide Korean companies with normal production for up to 100 days by 2014. South Korean officials also stated that “in order to increase national reserves, the country will invest more in overseas mining operations in Mongolia, Australia and Canada, and work more closely with private companies such as Hyundai Motor Co. and POSCO,” according to the report by the Yonhap News Agency[6].

For Japan, the largest importer of Chinese rare earth, the story is very much the same. In response to the restrictions, a collection of Japanese and S. Korean companies have agreed to a $1.95 billion deal for 15 percent of a Brazilian niobium mine. While niobium isn't classified as a rare earth, it is a strategic, rare metal that falls under the policies being laid out by China.

“Nippon Steel, JFE Steel, and trading house Sojitz as well as the state-owned Japan Oil, Gas and Metals National Corp. will join forces with South Korea's Posco and the country's National Pension Service (NPS).” The deal is for the “Companhia Brasileira de Metalurgia e Mineracao (CBMM) mines niobium, a metal crucial to the production of high-grade steel for automobiles and other products” stated the report from the Associated Foreign Press[7]. The mine produces 82 percent of the world supply of niobium.

As China, South Korea and other countries build strategic reserves of rare earths the new demand is only going to further exacerbate supply side in the market further driving up prices. China will achieve the market consolidation they desire by increasing the costs of production through environmental regulation driving out small firms without a national takeover, potentially avoiding a WTO trade dispute. All of these factors may ensure that the rare earth market will see just as much drama in 2011 as we saw last year.


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