Medallion Resources Company Update - via email Dear Medallion Shareholders and Friends, It has been a busy and challenging year. The junior resource market is now in its fourth year of a bear market and the rare-earth sector has not been much of a shelter.
Fortunately rare-earth product pricing itself has recently stabilized following steep declines since mid-2011. Prices have settled at levels about double the pre-crisis period - the "crisis" beginning when China shook the global market by unexpectedly restricting exports. While many hard-rock explorers and developers are currently hibernating due to the economics of their approach, this more normal rare-earth marketplace is strongly supportive of Medallion's by-product processing strategy with its lower capital and technical risk profile.
Recently Medallion initiated lab-scale extraction tests of rare earths from suppliers' sample monazite sand. These small scale tests, prompted by rare-earth industry interest, use standard processes to produce a rare-earth chemical concentrate, co-products and waste materials of the type expected from a commercial operation. The resulting rare-earth concentrate will provide a sample product for discussions with potential customers. We see this test phase as an important step closer to process refinement and ultimate commercialization of the Company's monazite strategy.
This new interest in rare-earth concentrate material, largely driven by the strong demand for the magnet rare-earth elements neodymium and praseodymium, bodes well for development of a stand-alone rare-earth extraction facility. It has also has prompted the Company to start looking at alternative locations outside the Middle East, including North America, in order to speed up the path to production.
To support these advancements, the Company successfully raised $700,000 in the summer and recently closed a tranche of $150,000 of additional private placement equity - which has been increased up to a total of $250,000.
The key focus of our activity remains to secure a long-term supplier for monazite, the raw material to feed the proposed plant, and discussions continue. Once secured, we expect to quickly move into detailed economic studies and advance our off-take discussions.
Our Board and management team remain optimistic that our approach will deliver near-term, low-cost rare-earth products for the marketplace and success to our shareholders.
On behalf of Medallion, I sincerely thank you for your loyalty and goodwill throughout 2014 and best wishes for a happy holiday season and a prosperous 2015.
Donald M. Lay
President and CEO