Rare Earth Element Companies to Watch
China Holds Back, Others to Pick Up the Slack
Over the past two years, Chinese rare earth metal exports have been steadily declining as the prices rise.
This conflicts with the fact that China is responsible for 95% of the world’s rare earth metal production and the fact that the metals are necessary for electronics in a time when technology is advancing at lightening pace.
According to Market Watch, in just the past year Chinese exports of rare earth metals have been cut in half. In the same amount of time, the value has increased ten times, to $121,000 per tonne.
But China is concerned about the pollution caused by the production processes these metals require. And the nation wants to crack down on illegal exports.
As Market Watch reports, however, China actually holds only about 30% of the world’s rare earth deposits. But opposition for exploration has been met in some locations.
In Malaysia, for example, citizens protested a production facility out of fear for the environment. And citizens of Kuantan opposed Lynas Corp’s (ASX: LYC) plans for a plant, the article reports.
However, China’s restrictions have called plenty of exploration companies to the forefront, and as prices rise these companies are competing to take advantage of the potential profts.
Around 300 companies are now involved in rare earth exploration, but it’s a field that only has room for a few big guys.
Some major companies have made their names known lately as up-and-coming players in the field.
Tantalus Rare Earths (XETRA: TAE) announced resource estimates for its Madagascar project.
This deposit, the company told Proactive Investors, has in-ground potential value of an estimated $8.28 billion based on second quarter prices for 2011.
It contains 55 million tonnes of mineralization and 46,000 tonnes of rare earth oxides.
Quest Rare Minerals (AMEX: QRM) has access to a rare earth deposit at Strange Lake, announcing that they should be in the B-Zone by 2016.
This means, Seeking Alpha says, that the company has run into no problems with exploration.
And according to the Preliminary Economic Assessment, it’s an economical project.
Avalon Rare Metals (AMEX: AVL) is, the article reports, the only company currently focusing on an underground mine. Though risks and hazards come with this, as well as an economic impact, exploration at this type of mine could yield nice results.
Stans Energy Corp (PINK: HREEF) owns a mine in Kyrgyzstan. According to Seeking Alpha, this mine is half heavy rare earth elements (HREEs) and half light rare earth elements (LREEs).
Estimates show that the company could find even more deposits in the surrounding area, and the location holds the potential for base metal or even precious metal discovery.
Uncore Rare Metals (PINK: UURAF), reports the article, is the only company in the United States that could begin development in the next 5 years.
Their deposit, located at Alaska’s Bokan Mountain, is heavy on the HREEs and could even contain uranium.
Tasman Metals (PINK: TASXF), says Seeking Alpha, owns the only HREE deposit in Europe, located in Sweden.
This company could begin production, according to estimates, by 2015 or 2016.
Great Western Minerals (PINK: GWMGF), the article reports, is one last company to keep an eye on. Molycorp (NYSE: MCP) even had its eye on it.
Their HREE mine in South Africa could be one of the first to begin output.
That’s all for now,
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