Rare Earths, Graphite and Nickel Development and Exploration
Reducing dependency on foreign minerals
The Western US mining industry is living a transformative period in the realm of rare earth elements (REEs) and green-critical minerals like graphite, nickel and cobalt. According to the International Energy Agency, clean energy technologies will demand an increase from today’s levels of over 40% for copper and REEs, 60-70% for nickel and cobalt, and almost 90% for lithium by 2040.
China currently has the largest reserves of REEs and is poised to contribute significantly to the projected increase in both supply and demand. Economic and soft-power competition between China and the US is not new, but given that Beijing controls these REEs, they could be weaponized economically. Washington is therefore taking proactive measures to reverse this situation: For instance, in June 2022, the Biden Administration invoked the Defense Production Act (DPA) to address US dependence on imports of critical minerals, which gives the Department of Defense funding to support the supply chain for minerals like lithium, nickel, cobalt, graphite and REE.
In this context, from the "Americanization" of companies to the exploration of tailings for byproducts and reuse of abandoned mine sites, several dynamics have unfolded within the junior segment across the Western US to leverage government incentives and unlock the potential of mineral deposits.
The opportunity of REE while holding to environmental stewardship
With the surge in demand for critical minerals and the policies of the US Government, many companies have recognized an opportunity to realign their corporate narratives with Washington's political interest. Such is the case of American Rare Earths (ARR), an Australian company.
Melissa Sanderson, ARR's board member and spokesperson, explained that ARR intend to be listed at the highest level of the OTC and, eventually, on the NASDAQ. "As we embraced the motto of 'mined and made in America,' we are confident in the security and reliability of our supply chain. We envision ourselves at the heart of the US strategy as we anticipate the surge in demand from 2030 onward when hopefully ARR will be in full production," she said.
ARR possesses four assets: Halleck Creek, the flagship in Wyoming; Beaver Creek, also in Wyoming; Searchlight in Nevada; and La Paz, in Arizona. In March 2023, the company published a JORC report for Halleck Creek of 1.43 billion t of rare earths, enabling it to produce approximately 4 million t of crucial materials, namely neodymium and praseodymium. "Halleck Creek and La Paz share a critical characteristic: They are low in thorium and uranium. This becomes especially advantageous during the permitting process as we will not require special permits from the National Regulatory Agency nor need to implement elaborate storage methods, which translates to significant cost and time savings as we venture toward production," explained Sanderson.
This low level of thorium and uranium is a game changer since, historically, the mining and production of REE was associated with heavy environmental impacts, a reason why China and some other countries with lower environmental standards have monopolized the segment. In this context, REE companies have the opportunity to demonstrate that domestic production of these elements can be done efficiently, responsibly and sustainably.
“The Democratic party recognized the importance of REE in achieving a cleaner, greener economy. On the other hand, the Republican Party’s primary focus on enhancing national security, mainly by reducing reliance on China, also drives the urgency to accelerate the development of new mines.”
Melissa Sanderson, Board Member and Spokesperson, American Rare Earths
Through collaboration with US Government-funded research through the DOD, DOE, the Critical Materials Institute, the Lawrence Livermore Laboratories, and a consortium of US universities, ARR is seeking an innovative method for sustainable rare earth extraction employing genetic manipulation of biological agents. "If proven successful, these biological agents would be introduced at the concentrate stage, bonding for instance with the neodymium in the concentrate, allowing for the selection and isolation of pure neodymium, significantly streamlining the process, and resulting in considerable time and cost savings," concluded Sanderson.
Rare Element Resources, a company focused on Northeast Wyoming with its Bear Lodge project, completed a PFS showing a mine life of over 30 years, and has been focusing on collecting bulk samples for purposes of advancing its technology into a demonstration-scale processing and separation plant: "We plan to produce up to 10 t of neodymium-praseodymium (Nd/Pr) oxide at a high purity of 99.5%. In addition, we will also produce lanthanum, SEG (a combination of samarium, europium, and gadolinium), and heavy rare earth element concentrate for further refining," shared Brent Berg, president and CEO of the company.
To advance the technology, Rare Element Resources has forged partnerships with the Department of Energy (DOE), which provided half of the funding for the US$44 million demonstration-scale project in Upton, Wyoming. Additionally, the company has collaborated with General Atomics, its majority shareholder. "Our process prioritizes environmental sustainability by recycling major chemical reagents, thereby reducing waste. We have streamlined our approach by eliminating the stripping step in solvent extraction, setting us apart from conventional methods used in countries like China," explained Berg.
In the Stibnite mining district in central Idaho, a unique narrative is unfolding as the demand for antimony catalyzes the restoration of an abandoned mine site. Over a century of mining activities, which contributed to the discovery of critical minerals during World War II, has left behind environmental challenges that are now being addressed while bringing the district back alive. Once operational, the Stibnite gold project, being developed —or restored— by Perpetua Resources, will be one of the country's highest-grade, lowest-cost open-pit gold mines in the US, with 4.8 million oz of gold reserves. But what is moving the project forward is the antimony component: "The Stibnite Gold Project is primarily a gold project, with antimony playing a pivotal role in the permitting process given its status as a critical mineral. In total, there are 6 million ounces of measured and indicated resources, with an additional 1.2 million oz of inferred resources." explained Laurel Sayer, CEO of Perpetua Resources.
The Department of Defense has granted Perpetua up to US$24.5 million in Defense Production Act Title III in Defense Production Act Title III funds to advance through the permitting requirements and, more recently, it received a US$15.5 million award to study military-grade antimony trisulfide development from on-site materials. Perpetua is expecting the release of the final EIS and draft Record of Decision, with a final Record of Decision expected in 2024, and its goals are to secure the final NEPA stamp of approval and all ancillary permits to be ready for construction, aiming to start production in 2027.
Cobalt, Nickel and Graphite: Critical for EVs
Champion Electric has adopted a different approach from ARR. Initially established in 2016 under the name Idaho Champion, the company primarily focused on assets in Idaho. However, in 2023 it rebranded itself as Champion Electric to better represent its expansion into Québec and its focus on battery metals like lithium and cobalt.
In Idaho, Champion Electric owns the cobalt Twin Peaks project, a past producing mine located next to Electra Battery Materials' Iron Creek project. "The geologic structure at Twin Peaks is perceived as an extension of the Iron Creek project. As a result, we anticipate similar levels of success. In addition to Twin Peaks, we own other properties, including Victory, Fairway and Ulysses. Three of our properties are adjacent to the Jervois Mining ICO project, ready to go into production," said Jonathan Buick, president and CEO of Champion Electric Metals.
Buick believes that despite its importance, investors often misunderstand the importance of cobalt, whose primary function in batteries is stabilizing nickel. "Establishing a domestic cobalt supply becomes critical as we advance the electrification of the world. The geopolitical aspect is also a concern, as state control over cobalt supplies could become political," he concluded.
On the other hand, nickel in lithium-ion batteries lends a higher energy density and more storage capacity. The US is home to only one nickel mine, Lundin Mining's Eagle Mine in Michigan, that produced 18,000 t of nickel in concentrate in 2022, which was exported to smelters in Canada and overseas. Alaska Energy Metals intends to add another: the Nicolai project in Alaska. Gregory Beischer, president and CEO of Alaska Energy Metals, said: "Despite challenging market conditions, we demonstrated the project's quality and raised an additional US$9.5 million in the summer of 2023, promptly investing it in drilling activities. Recognizing the extensive historical drilling and disseminated nickel mineralization over significant distances, we strategically drilled on a grid pattern to initiate the first resource calculation," explained Beischer, who added that, by March 2024, he anticipates announcing the completion of the resource calculation.
Another critical component of lithium-ion batteries is graphite, which is used to intercalate lithium ions efficiently. This makes it a suitable material for the reversible electrochemical reactions that occur during lithium-ion batteries' charging and discharging cycles. In 2022, China was the world's leading graphite producer, producing an estimated 65% of world production, and recently announced its decision to restrict graphite exports, days after Washington released new controls to limit semiconductors chips to Chinese companies. Beijing's decision shows the current geopolitical dynamics surrounding minerals and how they can be weaponized between hard and soft power.
To bridge this gap, Westwater Resources, a company based in Denver, Colorado, but with projects in Alabama, plans to establish a fully integrated graphite production in the US by developing its Coosa graphite project to feed the Kellyton graphite processing plant. "Our mining operations are set to provide all the graphite needed for our processing facility. We recently announced a 33% increase in the processing plant's capacity. In Phase I, our capacity is 10,000 t/y, which is expected to double when processing graphite for Coated Spherical Purified Graphite (CSPD) due to a 50% efficiency rate," shared Frank Bakker, president and CEO of the company.
By the end of 2023, the Westwater expects to conclude the PEA for the Coosa project and commence the development of the mine to have it operational by 2028. In the meantime, it has an agreement with Syrah Resources to feed the processing plant with graphite from Mozambique.
Article header image by Dane Rhys, courtesy of American Rare Earths