Tuesday 7th April 2020

Resource Clips


Posts tagged ‘u.s.’

Crisis response

April 3rd, 2020

A look at mining, exploration, infrastructure and supply chains under the pandemic

by Greg Klein

A look at mining, exploration, infrastructure and supply chains

 

Idled explorers: Can you help?

“Essential supplies and personnel are needed to create and operate temporary facilities for testing, triage, housing and isolation areas for vulnerable populations,” states the Association for Mineral Exploration. “As mineral explorers, we have access to the supplies needed and are in a unique position to help.”

AME calls on the industry to contribute excess capacity of the following:

  • Insulated structures (both hard and soft wall)

  • Camp gear such as furniture, lighting and kitchen appliances

  • Medical equipment

  • Camp support personnel such as caterers, housekeepers, janitors, etc.

  • Available medical staff including such qualifications as OFA3s, paramedics, RNs, etc.

  • Other supplies or skills

If you can help, please fill out this form and AME will be in touch. 

For further information contact Savannah Nadeau.

Preparing for a wider emergency

Given the danger of one crisis triggering others, essential infrastructure remains at risk. One plan to safeguard Ontario’s electricity service would require Toronto workers to bunk down in employer-supplied accommodation under lockdown conditions better known to isolated locations.

A look at mining, exploration, infrastructure and supply chains

Quarantines might require essential
services to provide job-site bed and board.
(Photo: Independent Electricity System Operator)

It hasn’t happened yet, but the province’s Independent Electricity System Operator stands ready for the possibility, according to a Canadian Press story published by the Globe and Mail. A not-for-profit agency established by the province, the IESO co-ordinates Ontario electricity supply to meet demand.

About 90% of its staff now work at home but another 48 employees must still come into work, CEO Peter Gregg said. Eight six-person teams now undergo 12-hour shifts in two Toronto-area control rooms.

“Should it become necessary, he said, bed, food and other on-site arrangements have been made to allow the operators to stay at their workplaces as a similar agency in New York has done,” CP reported.

Similar plans may well be underway not only for essential infrastructure but also for essential production, processing, manufacturing, communications, transportation and trade. One sign of the times to come could be locked-down camps in supermarket parking lots for our under-appreciated retail-sector heroes.

Meanwhile, retaining and protecting care-home staff already constitute a crisis within a crisis.

Australia guards against predatory foreign takeovers

With China prominently in mind, Australia has taken extra measures to protect companies and projects shattered by the COVID-19 economy. Canberra has temporarily granted its Foreign Investment Review Board extra powers to guard distressed companies and assets against acquisitions by opportunistic foreigners. Although previous foreign acquisitions came under review only when the price passed certain thresholds, now all such transactions get FIRB scrutiny.

The changes follow concerns raised by MPs on Australia’s intelligence and security committee. The Sydney Morning Herald quoted committee chairperson Andrew Hastie warning of “foreign state-owned enterprises working contrary to our national interest. More than ever, we need to protect ourselves from geo-strategic moves masquerading as legitimate business.”

Committee member Tim Wilson added, “We can’t allow foreign state-owned enterprises and their business fronts to use COVID-19’s economic carnage as a gateway to swoop distressed businesses and assets.”

Among protected assets are exploration and mining projects, utilities, infrastructure and an interest of 20% or more in a company or business.

Critical minerals become ever more critical

As Lynas Corp extended the suspension of its rare earths processing facility in line with Malaysian government pandemic orders, the company noted the importance of its products “in permanent magnets used in medical devices including ventilators, and in lanthanum products used in oil refineries for petroleum production.”

A look at mining, exploration, infrastructure and supply chains

The suspension of its Malaysian plant prompted
Lynas to emphasize REs’ criticality to virus treatment.
(Photo: Lynas Corp)

Originally set to expire on March 31, the government order currently stays in force until April 14. RE extraction continues at Lynas’ Mount Weld mine in Western Australia.

In late February Malaysia granted the company a three-year licence renewal for the processing facility, which had been threatened with closure due to controversy about its low-level radioactive tailings. Among conditions for the renewal are development of a permanent disposal facility for existing waste and putting a cracking and leaching plant in operation outside Malaysia by July 2023 to end the practice of transporting radioactive material to the country.

Committed to maintaining a non-Chinese supply chain, the company plans to locate the C&L plant in Kalgoorlie, Western Australia.

Sharing the disease, hoarding the treatment

A problem recognized in American defence procurement has hit health care—the need to build non-Chinese supply chains. Most of the world’s ventilators and about half the masks are manufactured in China, points out a recent column by Terry Glavin.

The West is learning, finally and the hard way, “that thriving liberal democracies cannot co-exist for long within a model of neo-liberal globalization that admits into its embrace such a tyrannical state-capitalist monstrosity as the People’s Republic of China.”

The U.S., for example, relies heavily on China for antibiotics, painkillers, surgical gowns, equipment that measures blood oxygen levels and magnetic resonance imaging scanners. China effectively banned medical equipment exports as soon as Wuhan went on lockdown, Glavin adds.

“It probably didn’t help that Ottawa sent 16,000 tonnes of gear to China back in February. That was a lot of gear—1,101 masks, 50,118 face shields, 36,425 medical coveralls, 200,000 pairs of gloves and so on—but a drop in Beijing’s bucket. A New York Times investigation last month found that China had imported 56 million respirators and masks, just in the first week of the Wuhan shutdown.

“It is not known how much of that cargo came from the massive bulk-buying campaign organized and carried out across Canada by affiliates of the United Front Work Department, the overseas propaganda and influence-peddling arm of the Chinese Communist Party.”

A look at mining, exploration, infrastructure and supply chains

Desperate need for health care supplies
pits country against country. (Photo: 3M)

Nor does the non-Chinese world display altruism. In response to the crisis, the EU and more than 50 countries have either banned or restricted exports of medical equipment, Glavin states.

By April 3 global health care products supplier 3M revealed that Washington asked the company to stop exporting U.S.-manufactured N95 respirators to Canada and Latin America. 3M noted “significant humanitarian implications” but also the possibility of trade retaliation. “If that were to occur, the net number of respirators being made available to the United States would actually decrease.”

The company did win China’s permission to import 10 million of its own Chinese-manufactured N95s into the U.S.

Meanwhile the Canadian government comes under increasing criticism for discouraging the public from wearing masks.

Chinese supply chains also jeopardized by Chinese disease

As the world’s main exporter of manufactured goods, China’s the main importer of raw materials, especially metals. But, as the world’s main exporter of disease, China managed to threaten its own supplies.

Reuters columnist Andy Home outlined lockdown-imposed cutbacks of copper, zinc and lead from Chile and Peru, and chrome from South Africa; reductions in cobalt from the Democratic Republic of Congo, in tin from already depleting Myanmar, and in nickel from the Philippines, the latter a hoped-for replacement after Indonesia banned unprocessed exports.

The longer the lockdowns, “the greater the potential for supply chain disruption,” Home comments. “As the biggest buyer of metallic raw materials, this is a ticking time-bomb for China’s metals producers.”

Miners’ providence unevenly distributed

Probably no other foreign shutdowns have affected as many Canadian miners and explorers as that of Mexico. Considered non-essential, their work will be suspended until April 30, with extensions more than likely. Mexico’s announcement must have sounded familiar to Pan American Silver TSX:PAAS, which had already pressed the pause button to comply with national quarantines in Peru, Argentina and Bolivia. That currently limits the company’s mining to Timmins, where production has been reduced by about 10% to 20% to allow physical distancing.

A look at mining, exploration, infrastructure and supply chains

Mauritania exempted Kinross Gold’s Tasiast mine
from domestic travel restrictions. (Photo: Kinross Gold)

One company more favourably located, so far, is Kinross Gold TSX:K. As of April 1, operations continued at its seven mines in Nevada, Alaska, Brazil, Mauritania, Russia and Ghana, while work went on at its four non-producing projects in Alaska, Mauritania, Russia and Chile.

Expanded shutdowns ordered by Ontario on April 3 include many construction and industrial projects but exempt mining. Earlier that day New Gold TSX:NGD announced Rainy River’s restart after a two-week suspension to allow self-isolation among employees. Many of the mine’s workers live locally and made short trips into Minnesota before the border closed.

Quebec border restrictions have hindered the Ontario operations of Kirkland Lake Gold TSX:KL, cutting off a source of employees and contractors. As a result the company reduced production at its Macassa mine and suspended work at its Holt complex, comprising three gold mines and a mill. Kirkland reduced operations at its Detour Lake mine effective March 23, after a worker showed COVID-19 symptoms and self-isolated on March 14. He tested positive on March 26. Production continues at the company’s Fosterville mine in Australia.

Some explorers have been idled by government restrictions, others by market conditions. Still, some companies have money and jurisdictions in which to spend it. Liberty Gold TSX:LGD, for example, resumed drilling its Black Pine gold project in Idaho on March 31.

Some jurisdictions, like B.C. and New Brunswick, have extended work requirement deadlines to help companies keep exploration claims active.

“China needs to be held responsible”

A few Canadian journalists are saying what we might never hear from our politicians. Here, for example, is Toronto Sun columnist Lorrie Goldstein:

“China needs to be held responsible. The problem is, because of its political power— and you see it in the World Health Organization announcements, in Canadian announcements—they’ve been praising what China did. There would have been a virus anyway. China made it worse. More people are dying, more people are being infected, and its dictators need to be held to account.”

Work suspended

March 26th, 2020

Some Canadian mining and exploration dispatches during the pandemic

by Greg Klein

Shut Down Canada has largely been achieved, but not by the forces that advocated it nor—until someone finds a way of blaming this on climate change—by the doomsday belief they were pushing. Residents of our strangely quiet cities and towns watch the horror unfold elsewhere while wondering how long and hard the pandemic will hit Canada. Meanwhile, workers and business owners might consider themselves lucky if the economy fares no worse than a very serious recession.

Some Canadian mining and exploration dispatches during the pandemic

A reminder that one crisis can trigger another unwittingly came from FortisAlberta on March 23. The company that provides 60% of the province’s electricity “is taking the necessary actions and precautions to protect the health and well-being of its employees and to provide electricity service to its customers.”

The obvious but demoralizing question arises: What happens if too many key people get sick? That danger could apply to any number of essential services. Economic collapse, social disorder, a breakdown of supply chains add to the nightmarish possibilities.

All of which might not happen. In the meantime we can thank the front line workers who keep our society functioning to the extent that it does. Those one- or two-buck-an-hour temporary pay raises hardly acknowledge society’s debt to retail staff who interact constantly with a potentially plague-ridden public. Care workers for the elderly constitute another group of low-paid heroes, several of whom have already made the ultimate sacrifice.

In the meantime here are some reports on Canadian mining’s response to the crisis.

Inconsistent closures suggest an ambivalent industry

Some Canadian mining and exploration dispatches during the pandemic

IAMGOLD sidelined its Westwood operation in Quebec but
continues work on its Coté project in Ontario. (Photo: IAMGOLD)

Mining hasn’t actually been banned in Ontario and Quebec, although shutdowns of non-essential services continue to April 8 and April 13 respectively. Extensions, of course, look likely. Quebec has ordered the industry, along with aluminum smelting, to “minimize their activities.” Ontario specifically exempted mineral exploration, development, mining and their support services from mandatory closures.

Interpreting Quebec’s decree as a ban, IAMGOLD TSX:IMG suspended its Westwood gold mine in that province but continued work at its 64.75%-held, advanced-stage Coté gold project in Ontario as an “essential service.” Production continues at the company’s Burkina Faso and Suriname operations.

But regardless of government bans or directives, voluntary suspensions take place. Restrictions on travel and social distancing have made projects non-viable, while the threat of localized outbreaks looms large—not just at the job sites and accommodations, but in the isolated communities that supply much of the labour.

In Canada, that often means native communities. “They have a bad history with disproportionate impacts from epidemics,” a Vale Canada spokesperson told the Financial Post. The company put its Voisey’s Bay mine in Labrador on care and maintenance, and planned reductions at its associated Long Harbour nickel-copper-cobalt processing plant in Newfoundland.

So far alone of the Northwest Territories’ three operations, Dominion Diamond Mines announced an indefinite suspension for Ekati on March 19. The Union of Northern Workers stated its intention to grieve the manner in which its members were laid off.

Some Canadian mining and exploration dispatches during the pandemic

Having laid off its native staff, Agnico Eagle continues its Nunavut
operations largely with workers from Quebec. (Photo: Agnico Eagle)

Agnico Eagle Mines TSX:AEM made the ramp-down decision a day after Quebec’s March 23 order, after discussions with government “to get additional clarity.” The suspensions applied to three Quebec mines but the company planned “reduced operations” at Meliadine and Meadowbank in Nunavut, largely under Quebecois workers.

Five days earlier Agnico Eagle began sending home Nunavummiut staff from its Nunavut mines and exploration projects to prevent virus transmission “from a southern worker to a Nunavut worker, with the risk of it moving into the communities,” explained CEO Sean Boyd. Production was expected to continue under the remaining staff.

The following day residents blocked a road from Rankin Inlet airport to Meliadine to protest the use of replacement workers from Mirabel and Val d’Or, Quebec. Although the territory has banned travel from other jurisdictions, critical workers may apply for an exemption. They’re also required to undergo two weeks of isolation in their own region prior to travel.

From boots on the ground to fingers on the keyboard

Exploration suspensions haven’t come at a bad time for some projects, which had completed or nearly completed winter programs. Where labs remain open, assays might provide some badly needed good news.

Much of the crucial work of analyzing results and planning future exploration can be done by desktop. One example of a company with a multinational work-at-home team is Turmalina Metals TSXV:TBX, which completed a seasonal field program at its San Francisco de Los Andes gold project shortly before Argentina imposed a nation-wide quarantine. “While Turmalina maintains a corporate office in Canada our technical and managerial team operate remotely from individual home offices located in Peru, Brazil, Argentina, Canada and Asia,” states a March 23 announcement. “The current compilation, analysis and modeling of recently collected data is being done on a physically decentralized basis from these individual home offices as the company prepares for drilling.”

Follow the money

No one’s saying so out loud, but travel restrictions just might divert money from conferences, trade shows and expense accounts to actual work. Then again, money can still be squandered on low-IQ promotional campaigns produced at the kitchen table.

Every metal and mineral has a silver lining

This isn’t a sector that overlooks opportunity. Two days after Vanstar Mining Resources TSXV:VSR reported that drilling “continues without stopping” at its 25%-held Nelligan project in Quebec, the company acknowledged that majority partner IAMGOLD had suspended work. But “it should be noted that current events can also bring certain opportunities for acquiring gold projects at a lower cost,” Vanstar pointed out. The junior was merely echoing comments made by others, including BHP Group NYSE:BHP earlier this month.

With the economic outlook as confused as a professional stock-picker’s thought processes, mining’s future remains profoundly uncertain. But diminished supply can certainly help chances of rebounding demand.

And suspensions might encourage advantageous awareness, as noted by Uranium Energy Corp NYSE:UEC president/CEO Amir Adnani. “The recent global events and supply disruptions further underscore the importance of domestic supply chains for vital resources,” stated the U.S. purveyor of U3O8.

How could we live without them?

Endeavours deemed essential by Ontario and Quebec include capital markets services and agencies like the TMX Group and securities commissions. The provinces also consider alcohol and cannabis retailers essential. As if the world wasn’t already facing worse consequences, Toronto medical officer Eileen de Villa said banning booze “would lead to pretty significant health consequences.”

She didn’t specifically mention geoscientists.

The experts speak

Some fatuous remarks at PDAC provided retrospectively grim humour, as well as an exhibition of prognosticator pomposity. Here’s Mickey Fulp’s take on COVID-19, as quoted by IKN:

  • “I think it’s overblown.”

  • “All these shows are flu incubators, anyway.”

  • “I think it (i.e. infections) are going to be less this year, because people are doing things like washing their hands.”

  • “This is a blip on the radar screen. Especially in the U.S. where I’m from, because our economy is absolutely roaring and virus fears are not going to do major damage to the U.S. market.”

  • “I think it absolutely is an overreaction and the quicker it’s realized, the better.”

  • “This is a variety of flu.”

Of course to sheltered North Americans, the first week of March might seem a long time ago. So here’s Doug Casey’s insight, as published by Kitco on March 24:

“The virus itself isn’t nearly as serious, I don’t know how serious it’s going to be, but not terribly in my opinion. What I’m really shocked at, Daniela, is the degree of hysteria on the part of the powers that be. They’ve actually just gone insane.”

Click here for objective data on the coronavirus pandemic.

Update: Saville Resources reports B.C. Greenwood sample results, vends project

March 3rd, 2020

by Greg Klein | March 2, 2020, updated March 3, 2020

Update: On March 3 Saville Resources announced the sale of its Bud property to Ximen Mining TSXV:XIM for 388,888 Ximen shares, subject to TSXV approval.

A company focused on critical minerals in Quebec has also kept busy in an historic southern British Columbia mining camp. On March 2 Saville Resources TSXV:SRE released grab sample assays from a 2019 field program at the Bud property in the Boundary district that includes the Republic, Belcher, Rossland and Greenwood camps of B.C. and Washington. Some highlights included:

  • 3.84 g/t gold, 105 ppm cobalt, 2,200 ppm copper and 824 ppm zinc

  • 1.52 g/t gold, 247 ppm cobalt, 4,070 ppm copper and 50 ppm zinc

  • 0.864 g/t gold, 476 ppm cobalt, 6,540 ppm copper and 127 ppm zinc
Saville Resources reports B.C. Greenwood sample results

Grab samples from the previous year reached up to 4.57 g/t gold, 27.7 g/t silver and 6.7% copper; as well as 4.44 g/t gold, 17 g/t silver and 6.84% copper.

Saville stated the 381-hectare property potentially hosts copper-gold skarn mineralization similar to the Motherlode and Sunset properties 500 metres away that had historic production of 4.2 million tonnes averaging 0.8% copper and 1.3 g/t gold. The company also sees potential for gold-bearing epithermal veins.

Reporting on its flagship Niobium Claim Group in northern Quebec last month, Saville announced completion of a preliminary mineralogical analysis conducted as part of a University of Windsor research project. Among the results, the study found three encouraging signs for the project:

The dominant niobium minerals are pyrochlore and columbite, a potential processing advantage with the most common minerals for niobium globally.

The niobium may have been mobilized, which might enhance a project’s grade.

The mineralogy supports a model of a continuous niobium-mineralized trend through the complex.

Saville drew parallels between the project’s Mallard prospect and Magris Resources’ Niobec mine in Quebec. Both feature carbonatites, while Niobec’s mineralization is hosted by pyrochlore and columbite similar in grain size to that found in Mallard’s preliminary analysis. Additionally, both Mallard and Niobec show mineralization in moderate to steeply dipping elongate lenses.

Following near-surface, high-grade niobium and tantalum intercepts from last year’s drilling, Saville plans further exploration this year. The company also plans to evaluate the property’s fluorspar potential after reviewing impressive historic grades for calcium fluoride.

Niobium, tantalum and fluorspar appear on the United States list of 35 critical minerals. Amid increasing concern, in January the U.S. and Canada signed a Joint Action Plan on Critical Minerals to develop deposits and supply chains.

Saville operates the Niobium Claim Group under a 75% earn-in from Commerce Resources TSXV:CCE, which holds the advanced-stage Ashram rare earths deposit two kilometres away.

Read more about Saville Resources.

Natural Resources Minister Seamus O’Regan comments on the Canada-U.S. Joint Action Plan on Critical Minerals Collaboration

January 30th, 2020

…Read more

Commerce Resources reports fluorspar upgrade progress from the Ashram rare earths deposit

January 28th, 2020

This story has been updated and moved here.

“It’s time to be ambitious” on critical minerals: Mining Association of Canada

January 24th, 2020

by Greg Klein | January 24, 2020

Canadian-American co-operation on essential elements means opportunity for this country’s wider economy, Pierre Gratton emphasizes. Speaking to the Vancouver Board of Trade, the president/CEO of the Mining Association of Canada commented on the recent Canada-U.S. Joint Action Plan on Critical Minerals Collaboration, as well as the Canadian Minerals and Metals Plan.

Two weeks ago Natural Resources Canada announced the cross-border agreement to secure deposits and develop supply chains for minerals essential to the economy, defence, technology and clean energy. The initiative takes place as the U.S. seeks ways to reduce its dependency on sources considered unreliable, unethical or potential economic and military rivals.

It’s time to be ambitious on critical minerals Mining Association of Canada

Pierre Gratton: “We have an opportunity to lay the foundation
for a new era in investment and middle class job creation,
not just in mining but in new, emerging downstream industrial
and manufacturing sectors.” (Photo: Matt Borck,
courtesy Greater Vancouver Board of Trade)

“Critical minerals are more than rare earth elements, and include several minerals and metals already mined in Canada including cobalt, copper, precious metals, nickel and uranium, which are critical to low-carbon electrification and new battery technologies in the automotive, space, defence and high-tech sectors,” said Gratton.

“It’s time to be ambitious. We have an opportunity to lay the foundation for a new era in investment and middle class job creation, not just in mining but in new, emerging downstream industrial and manufacturing sectors.”

Canada ranks among the world’s top five countries for 15 minerals and metals, MAC stated, and remains a global leader in responsible mining practices. Over the past five years MAC’s Towards Sustainable Mining program has been adopted by mining associations in seven countries on five continents.

“TSM focuses on enabling mining companies to meet society’s needs for minerals, metals and energy products in the most socially, economically and environmentally responsible way through mandatory commitments to annually report and assure social and environmental performance with strong multi-stakeholder oversight,” the association added.

“Canadian metals come conflict-free, meeting the highest environmental standards and a commitment to transparency unmatched anywhere,” Gratton continued. “We are confident that with these sustainable standards and new government commitments, Canada’s mining industry has the tools and support to provide the responsibly sourced minerals vital to industries around the world.”

Gratton also spoke on the Canadian Minerals and Metals Plan, a federal-provincial initiative intended to enhance the industry’s competitiveness, innovation and native participation.

Mining contributes $97 billion to national GDP and 19% of domestic exports, employing 626,000 people directly and indirectly across the country. The industry is proportionally Canada’s largest private sector employer of natives and a major customer of native-owned businesses.

Clint Cox: Formidable challenges face competitors of Chinese rare earths

January 20th, 2020

by Greg Klein | January 20, 2020

Depending which part of the supply chain’s under consideration, this one country produces anywhere from 70% to 95% of these critical minerals. China’s overwhelming rare earths dominance has long been obvious but trade tensions have once again highlighted the problem. Speaking at VRIC 2020 on January 19, Clint Cox outlined the hurdles Westerners face in the struggle to ensure security of supply.

Formidable challenges face competitors of Chinese rare earths

An analyst with The Anchor House who’s specialized in REs since 2006, Cox works with people throughout the supply chain including end users, government agencies, producers and junior explorers.

Last year China’s trade war threat to “weaponize” rare earths brought chills to Western end-users, who are all too familiar with the crisis of 2010. Prior to the Senkaku incident, prices had been trending downwards. Then came the monumental spike, shooting up costs of some elements 30 times.

“Our entire auto industry in North America almost shut down because of this,” Cox says. “A number of other industries almost shut down because of this.”

Naturally juniors found opportunity in crisis. Previously numbering about a dozen, ASX- and TSXV-listed rare earths explorers swelled their numbers beyond 450, a number grossly disproportionate to the availability of qualified geos. “They raised almost $6 billion in that time period,” Cox points out. “They ended up with one producing mine in Lynas Corporation and one mine in Molycorp, the Mountain Pass mine that went bankrupt.”

Mountain Pass in California has since re-opened—as a supplier to China. The world’s greatest source of rare earths deposits has, over the last two years, become a significant importer.

That’s a legacy of environmental neglect that includes an 11-square-kilometre tailings pond with about 100,000 to 150,000 tonnes of exposed radioactive muck, right next to a tributary of the Yellow River.

“China knows this,” he says. “They’re trying to fix it.”

As a result the government has been shutting down mines and looking for external sources. But on a global scale domestic production remains overwhelming.

As does the processing supply chain, led by six state-owned companies that have consolidated their operations. The Big Six benefits from China’s approach to capitalism.

They are all subsidized, every last one of them. They’re subsidized at the local level, the provincial level and the national level.—Clint Cox

“They are all subsidized, every last one of them,” Cox emphasizes. “They’re subsidized at the local level, the provincial level and the national level. This could be free power, this could be interest-free loans, it could be loans that never have to be paid back, and sometimes just flat-out cash payments. They are subsidized at every level.”

Companies in Bayan Obo, China’s most important rare earths-producing region, received about $395 million in government support over just one year. “That’s free money, that’s a subsidy, that’s tough to compete with. That’s way over what the United States is going to spend to try to solve this issue.”

A 20-year expansion plan for rare earths projects in the region finished well ahead of schedule, he notes.

Cox says China began 37 rare earths projects last year, promising some 48,000 tonnes of magnet production. “We only have a couple of hundred tonnes of magnet production in North America. And they spent close to, we gather, ten and twenty billion dollars on making rare earths facilities last year. And we’re excited about tens of millions, or maybe a hundred million dollars spent on some of the projects by the government this year.”

The country’s environmental legacy notwithstanding, China’s current handling of radioactivity presents another advantage. Freeing up the miners, the Chinese nuclear authority now takes responsibility for dealing appropriately with waste. Non-Chinese companies have to fend for themselves. Such challenges have been illustrated by Lynas, which faces opposition to the cracking and leaching plant in Malaysia that processes material from the company’s Mount Weld mine in Western Australia.

Another Chinese advantage: The Big Six launders material from the “unofficial or black market,” coming from unsanctioned, artisanal operations of dubious environmental and workplace standards. Some of it comes from inside China, while additional sources include Myanmar and other parts of southeast Asia, South America and elsewhere.

“So a lot of material flows through this black market. They legitimize it, because once it enters one of their supply chains, one of the Big Six, they can stamp an ‘official’ stamp on it and it becomes official material.”

He adds, “In general, Western countries can’t utilize the black market like China can. That is a huge edge. Some of the black market material can cost one-third of regular material.”

The juniors are definitely the place where the last crop of potential mines came from, and it looks like they might be the next out there. There’s some out there today.—Clint Cox

Supporting all this is a totalitarian regime. “That is tough to compete with.” Despite heightened Washington concern, the U.S. government agencies trying to address the problem remain uncoordinated. U.S. Congress currently has 18 bills concerning rare earths, Cox says.

Still, efforts persist to extract rare earths from sources such as mineral sands and coal. Then there are the juniors.

“The juniors are definitely the place where the last crop of potential mines came from, and it looks like they might be the next out there. There’s some out there today.”

But he has a warning for would-be miners who assume they’d receive a premium for non-Chinese supply. They won’t, he cautions. They’ll have to meet Chinese prices.

Other possibilities might not be predictable. “A dark horse can always come up. You never know what might happen in the rare earths industry. A new application, a new mine, a new processing technology, any of that can transform the industry.”

Read about the Canada-U.S. Joint Action Plan on Critical Minerals Collaboration.

Canada and U.S. formalize action plan for critical minerals deposits and supply chains

January 10th, 2020

by Greg Klein | January 10, 2020

A new commitment binds two neighbouring allies to produce resources essential to the economy, defence, technology and clean energy. Announced January 9, the Canada-U.S. Joint Action Plan on Critical Minerals Collaboration reflects both Canada’s mining potential and American concern about reliance on rival and potentially hostile countries.

Canada and U.S. formalize action plan for critical minerals deposits and supply chains

“Canada is an important supplier of 13 of the 35 minerals that the U.S. has identified as critical to economic and national security,” stated the Natural Resources Canada announcement. “We have the potential to become a reliable source of other critical minerals including rare earth elements, key components in many electronic devices that we use in our daily lives. Canada is currently the largest supplier of potash, indium, aluminum and tellurium to the U.S. and the second-largest supplier of niobium, tungsten and magnesium. Canada also supplies roughly one-quarter of the uranium needs of the U.S. and has been a reliable partner to the U.S. in this commodity for over 75 years.”

Among goals of the action plan are joint initiatives in R&D, supply chain modelling and increased support for industry, NRCan added. Experts from both countries will meet in the coming weeks.

Reflecting Washington’s concern, in 2017 the U.S. Geological Survey released the country’s first thorough study of critical minerals since 1973. Later that year President Donald Trump ordered a federal strategy that initially focused on 23 essential minerals. In 2018 the U.S. officially declared 35 minerals to be critical and at risk of supply disruption.

Since then, discussions have taken place between Trump and Prime Minister Justin Trudeau, along with other representatives from both countries.

By finalizing the collaboration agreement, “we are advancing secure access to the critical minerals that are key to our economic growth and security—including uranium and rare earth elements—while bolstering our competitiveness in global markets and creating jobs for Canadians,” said Canadian Natural Resources Minister Seamus O’Regan.

Read more about the U.S. critical minerals strategy.

Read about the U.S. list of 35 critical minerals.

Infographics: The United States and the new energy era’s lithium-ion supply chain

December 11th, 2019

by Nicholas LePan | posted with permission of Visual Capitalist | December 11, 2019

The world is rapidly shifting to renewable energy technologies. Battery minerals are set to become the new oil, with lithium-ion battery supply chains becoming the new pipelines.

China is currently leading this lithium-ion battery revolution—leaving our neighbour to the south dependent on its economic rival. However, the harsh lessons of the 1970s-to-’80s oil crises have increased pressure on the U.S. to develop its own domestic energy supply chain and gain access to key battery metals.

Introducing the new energy era

This infographic from Standard Lithium TSXV:SLL explores the current energy landscape and America’s position in the new energy era.

 

The new energy era’s lithium-ion supply chain

 

An energy dependence problem

Energy dependence is the degree of a nation’s reliance on imported energy, resulting from an insufficient domestic supply. Oil crises during the 1970s to ’80s revealed America’s reliance on foreign-produced oil, especially from the Middle East.

The U.S. economy ground to a halt when gas prices soared during the 1973 oil crisis—altering consumer behavior and energy policy for generations. In the aftermath of the crisis, the government imposed national speed limits to conserve oil, and also demanded cheaper, smaller and more fuel-efficient cars.

U.S. administrations set an objective to wean America off foreign oil through “energy independence”—the ability to meet the country’s fuel needs using domestic resources.

Lessons learned?

Spurred by technological breakthroughs such as hydraulic fracking, the U.S. now has the capacity to respond to high oil prices by ramping up domestic production.

By the end of 2019, total U.S. oil production could rise to 17.4 million barrels a day. At that level, American net imports of petroleum could fall in December 2019 to 320,000 barrels a day, the lowest since 1949.

In fact, the successful development of America’s shale fields is a key reason why the Organization of the Petroleum Exporting Countries (OPEC) has lost most of its influence over the supply and price of oil.

A renewable future: Turning the ship

The increasing scarcity of economic oil and gas fields, combined with the negative environmental impacts of oil and the declining costs of renewable power, are creating a new energy supply and demand dynamic.

Oil demand could drop by 16.5 million barrels per day. Oil producers could face significant losses, with $380 billion of above-ground investments becoming worthless if the oil industry and oil-rich nations are not prepared for a surge in green energy by 2030.

Energy companies are hedging their risk with increased investment in renewables. The world’s top 24 publicly listed oil companies spent on average 1.3% of their total budgets on low carbon technology in 2018, amounting to $260 billion. That is double the 0.68% the same group had invested on average through the period of 2010 and 2017.

The new geopolitics of energy: battery minerals

Low carbon technologies for the new energy era are also creating a demand for specific materials and new supply chains that can procure them.

Renewable and low carbon technology will be mineral-intensive, requiring many metals such as lithium, cobalt, graphite and nickel. These are key raw materials, and demand will only grow.

 

Material 2018 2028 2018-2028 % growth
Graphite anode in batteries 170,000 tonnes 2.05M tonnes 1,106%
Lithium in batteries 150,000 tonnes 1.89M tonnes 1,160%
Nickel in batteries 82,000 tonnes 1.09M tonnes 1,229%
Cobalt in batteries 58,000 tonnes 320,000 tonnes 452%

(Source: Benchmark Minerals Intelligence)

 

The cost of these materials is the largest factor in battery technology and will determine whether battery supply chains succeed or fail.

China currently dominates the lithium-ion battery supply chain and could continue to do so. This leaves the U.S. dependent on China in this new era.

Could history repeat itself?

The battery metals race

There are five stages in a lithium-ion battery supply chain—and the U.S. holds a smaller percentage of the global supply chain than China at nearly every stage.

 

The new energy era’s lithium-ion supply chain

 

China’s dominance of the global battery supply chain creates a competitive advantage that the U.S. has no choice but to rely on.

However, this can still be prevented if the U.S. moves fast. From natural resources, human capital and technology, the U.S. can build its own domestic supply.

Building the U.S. battery supply chain

The U.S. relies heavily on imports of several key materials necessary for a lithium-ion battery supply chain.

 

U.S. net import dependence
Lithum 50%
Cobalt 72%
Graphite 100%

(Source: U.S. Department of the Interior, Bureau of Land Management)

 

But the U.S. is making strides to secure its place in the new energy era. The American Minerals Security Act seeks to identify the resources necessary to secure America’s mineral independence.

The government has also released a list of 35 minerals it deems critical to the national interest.

Declaring U.S. battery independence

A supply chain starts with raw materials, and the U.S. has the resources necessary to build its own battery supply chain. This would help the country avoid supply disruptions like those seen during the oil crises in the 1970s.

Battery metals are becoming the new oil and supply chains the new pipelines. It is still early in this new energy era, and the victors are yet to be determined in the battery arms race.

Posted with permission of Visual Capitalist.

See European Union pledges €3.2 billion for lithium-ion R&D.

Commerce Resources congratulates Quebec PhD student for research on company’s rare earths project

December 5th, 2019

by Greg Klein | December 5, 2019

A study related to the Ashram rare earths-fluorspar deposit brought Université du Québec PhD candidate Sophie Costis first prize in an academic competition. Commerce Resources TSXV:CCE congratulated her on winning the $2,000 scholarship for her study on flotation tailings using the flowsheet for the company’s deposit. Costis delivered her presentation entitled Impact du gel-dégel et de la salinité sur le comportement de résidus miniers de terres rares en milieu nordique to l’Association Québécoise des Sciences de la Terre. Her first-place finish in le défi de la recherche en géosciences (Geoscience Research Challenge) was announced at last month’s Quebec Mines + Energy conference in Quebec City.

Commerce Resources congratulates Quebec PhD student for research on company’s rare earths project

A first-prize award recognizes the work of PhD candidate
Sophie Costis on Ashram’s flotation management.
(Photo: Université du Québec)

“The company is thrilled to see Sophie recognized for her hard work on the project over the last few years,” said Commerce president Chris Grove. “We are committed to advancing the Ashram project in an environmentally responsible manner and Sophie’s work will help build this foundation through high-quality data-gathering and analysis in a very important field.”

Backed by a $300,000 grant, Costis works in partnership with le Centre Eau Terre Environnement of l’Institut national de la recherche scientifique of l’Université du Québec. Expected to conclude late next year, her project provides further insight on tailings management in the flotation process plant.

Her findings so far show no serious concerns with Ashram’s flotation tailings management, show the process has no acid-generating potential and also show strong indications that there is no metal-leaching potential, Commerce stated.

In early October, Cynthia Kierscht, the U.S. deputy assistant secretary of state for Western Hemisphere affairs, hosted Shawn Tupper, associate deputy minister of Natural Resources Canada, at the first critical minerals working group meeting in Washington. The group will continue talks in coming months to finalize the joint plan.—Canadian Press

The work complements Ashram’s pre-feasibility studies for Ashram, which coincide with heightened concerns about critical minerals like fluorspar and especially rare earths. This week Canadian Press reported Ottawa is examining the role Canada could play in supplying the United States and other allied countries with minerals considered necessary to the economy, technology and defence.

NRCanada has contracted Roskill Consulting to forecast future demand for critical minerals that Canada could supply, CP added.

Last week Commerce released assays from near-surface intervals at Ashram showing high grades over wide widths. The company also has metallurgical studies underway at a Colorado lab to upgrade the project’s fluorspar potential, increase rare earths extraction and produce samples requested by potential customers.

Fluorspar wasn’t considered in the project’s 2012 resource but will be included in an update anticipated for the coming year, as will two seasons of extensive drilling. A major advantage of Ashram is the carbonatite-hosted deposit’s relatively simple monazite, bastnasite and xenotime mineralogy that’s familiar to conventional rare earths processing.

Fluorspar potential also comes under consideration at another critical minerals project two kilometres away, where Saville Resources TSXV:SRE operates the Niobium Claim Group under a 75% earn-in from Commerce. Following a drill program earlier this year, Saville released promising niobium-tantalum-phosphate results in June.

Last month Commerce closed the final tranche of a private placement totalling $2.51 million. A private placement in August brought in $413,749.

 

Update: An academic paper on Ashram’s flowsheet will be presented at the Canadian Mineral Processors conference in Ottawa on January 23. Lead author Jean-François Boulanger, an assistant professor at l’Université du Québec en Abitibi-Témiscamingue in Rouyn-Noranda and manager of the Ashram metallurgical tests completed at l’Université Laval from 2018 to 2019, will discuss his study entitled Challenges of Scale-Up in Grinding and Flotation of Rare Earth Minerals. The report will also be published in the organization’s periodical CMP Proceedings.

“The Ashram deposit, with its simple rare earth and gangue mineralogy, and resultant well-understood processing techniques, potentially presents a base case scenario for some issues and, therefore, the test data generated by Laval has been used to formulate cautionary guidance for scale-up and large-scale concentrate production, potentially applicable to all rare earth projects regardless of mineralogy,” stated an announcement from Commerce.

Second and third authors of the study are Claude Bazin, professor and project supervisor at Laval, and Darren Smith, project manager at Ashram.

Read more about Commerce Resources.