China is threatening to cut the U.S. off from rare earth supply - again. In fact, they’ve threatened to sanction firms including Lockheed Martin, Boeing Defense, Raytheon as well as individuals and entities that were involved in arms sales to Taiwan. “It sends a clear signal that China's decision-making won't be disturbed by the US and any acts that have undermined China's sovereignty, security and development interests are bound to face serious consequences, analysts said,” as noted by Global Times. One of China’s options in this situation is to choke rare earth to Lockheed Martin for example, knowing that F-35 fighter jets and Patriot missiles must have rare earth supply. Unfortunately, this isn’t the first time China has threatened such action. And it won’t be the last…. With the U.S. waking up to that threat, they’re on the hunt for far more rare earth supply to break China’s stronghold. The news is creating excitement for Defense Metals Corp. (TSXV:DEFN)(OTCQB:DFMTF), Tesla Inc. (NASDAQ:TSLA), Fortress Value Acquisition Corp. (NYSE:FVAC), Texas Mineral Resource Corp. (OTC:TMRC), and Energy Fuels Inc. (NYSE:UUUU)(TSX:EFR).
Defense Metals Corp. (TSXV:DEFN)(OTCQB:DFMTF) BREAKING NEWS : Defense Metals Corp. announced that on Friday November 13, 2020, Fortress Value Acquisition Corp. held a special meeting to consider the previously announced business combination with MP Materials. MP Materials is the owner and operator of Mountain Pass, the only rare earth element mining and processing site of scale in North America.
The FVAC-MP Materials special meeting represents a significant milestone in the establishment of a North American critical magnet metals supply chain. If approved, the combined company created by the FVAC-MP Materials merger would have an estimated post-transaction equity value of approximately $1.5 billion. Completion of the FVAC-MP Materials merger would signal a sea-change in ongoing joint Canadian-U.S.A. government efforts towards the establishment of a North American critical metals supply chain.
Defense Metals anticipates the merger would have a positive impact on the advancement of Canadian critical metals deposits, which includes Defense Metals Wicheeda Rare Earth Element (REE) Property.
The Wicheeda REE Project has indicated mineral resources of 4,890,000 tonnes averaging 3.02% LREO (Light Rare Earth Elements) and inferred mineral resources of 12,100,000 tonnes averaging 2.90% LREO. Flotation pilot-plant processing of a 26-tonne bulk sample of Wicheeda REE material yielded a mineral concentrate averaging 7.4% NdPr oxide (neodymium-praseodymium) critical magnet metals.
Craig Taylor, CEO of Defense Metals, stated: “The potential completion of the Fortress-MP Materials merger signals the beginning of what Defense Metals believes will be the inevitable establishment of a North American critical metals supply chain. This merger has the potential to unlock significant value in other North American REE deposits like Wicheeda; further buoyed by recent announcements by the state of California, Province of Quebec, China and UK targeting year 2035 to ban or significantly reduce sales of internal-combustion engine vehicles. The critical magnet metals, principally NdPr, that occur at high concentration within the Wicheeda REE Deposit will position Defense Metals to capitalize on the significant growth potential of the rapidly emerging green energy-electric vehicle sector.”
Other related developments from around the markets include:
Tesla Inc. (NASDAQ:TSLA) reported, “In the third quarter, we produced just over 145,000 vehicles and delivered nearly 140,000 vehicles. In terms of days of sales, new vehicle inventory declined further in Q3 as we continue to improve our delivery efficiency. Our net income and cash flow results will be announced along with the rest of our financial performance when we announce Q3 earnings. Our delivery count should be viewed as slightly conservative, as we only count a car as delivered if it is transferred to the customer and all paperwork is correct. Final numbers could vary by up to 0.5% or more. Tesla vehicle deliveries represent only one measure of the company’s financial performance and should not be relied on as an indicator of quarterly financial results, which depend on a variety of factors, including the cost of sales, foreign exchange movements and mix of directly leased vehicles.”
Fortress Value Acquisition Corp. (NYSE:FVAC), a special purpose acquisition company sponsored by an affiliate of Fortress Investment Group LLC announced that the U.S. Securities and Exchange Commission has declared effective the registration statement on Form S-4, which includes a proxy statement/consent solicitation/prospectus in connection with its special meeting of stockholders to consider the previously announced business combination with MP Materials. MP Materials is the owner and operator of Mountain Pass, the only rare earth mining and processing site of scale in North America. FVAC has commenced mailing the definitive proxy statement/consent solicitation/prospectus relating to the special meeting, which will be held on Friday, November 13, 2020. The proxy statement/consent solicitation/prospectus is being mailed to FVAC’s stockholders of record as of the close of business on October 12, 2020. Should the Business Combination be approved by stockholders, FVAC and MP Materials anticipate closing the Business Combination the week of November 16, 2020, subject to satisfaction or waiver of customary closing conditions.
Texas Mineral Resource Corp. (OTC:TMRC) just reported, “ Search Minerals Inc. and USA Rare Earth, LLC are pleased to announce that they have entered into a Technical Collaboration Framework Agreement to govern initial cooperation between USA Rare Earth and Search Minerals in a number of important areas of mutual interest. Search holds patented Direct Extraction Process technology and a 100% owned Critical Rare Earth Element District in SE Labrador, Canada. USA Rare Earth is establishing an integrated mine-to-magnet strategy independent of China, including funding and developing the Round Top Heavy Rare Earth and Critical Minerals Project in West Texas.”
Energy Fuels Inc. (NYSE:UUUU)(TSX:EFR) is pleased to announce that the Company has produced a rare earth element carbonate concentrate on a pilot scale at its 100% owned White Mesa Mill, located near Blanding, Utah. This REE Concentrate was produced using existing infrastructure and technologies at the Mill from a sample of monazite sands from a North American source. Monazite sands are a valuable natural uranium ore, which also contain high concentrations of REEs. The Mill recovered the high concentrations of REEs in the monazite sands, in addition to the contained uranium which will be sold into the nuclear fuel industry. The REE Concentrate produced this weekend is of high purity and is ready to be sent to a separation plant and further downstream REE processing facility for final acceptance test work.
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