A clear coordinated critical minerals strategy is
needed if the US is to compete in global markets for clean
energy and technology, warn key industry figures.
In the State of the Union address
on 24 January, President Barack Obama emphasised the importance
of developing energy sources that prevent the US from being
dependent on foreign resources. Alternative energy and
transport technology requires a range of industrial minerals,
including rare earths, lithium and graphite.
Yet critical minerals experts warn
that any potential strategies in this area are bound to fail
unless the US government comes up with a proactive plan to
drastically expand the countrys rare earth mining and
Michael Silver, CEO of global
manufacturer and supplier of advanced materials, American
Elements, said that the development of a rare earth mining
programme in the US was of the utmost importance.
[In his speech, President
Obama] talks about the cost of home-grown manufacturing and
home-grown alternative energy industries that will bring us out
of this economic situation, Silver told
The key thing that is being
missed is that America no longer has control of these raw
materials necessary to build these inventions.
In the case of rare earths, the US
has access to 13% of known global rare earth reserves, but is
dependent on foreign imports, primarily from world-leading
Government support needed
The CEO of California-based lithium producer Simbol Materials,
Luka Erceg, believes the US risks falling behind economies like
China, South Korea and Japan, which he says have clear and
consistent critical materials policies that drive domestic
In the case that minerals
exist here in the US, they should be produced. You should
encourage the development of these various steps in the supply
chain, but I wouldnt suggest that its only because
of a national security issue. Its more about economic
security, Erceg said.
If you miss the minerals
portion, you miss the opportunity for the material science
component, you miss the ability to innovate new production
techniques that take out inefficiency in the market, he
Simbol itself benefited from a $3m
grant from the Department of Energys (DOE) Geothermal
Technology Programme in 2009, which triggered around $43m in
further commercial capital.
But Erceg warned that the
government should not focus its incentives too heavily on
individual companies and projects.
I think that when governments
promote activities they need to spread it far and wide. You
should not give concentrated large pools of capital to single
companies as this puts the government in the position of
picking winners and losers, Erceg said.
We think that the government
should be choosing a policy area. If clean-tech is important,
then spread the investments where we can be intellectually
honest about opportunities and see which ones play out in the
marketplace, he added.
According to rare earths expert Jim
Hedrick, chairman of the US Rare Earths advisory
board, one of the greatest hurdles for the
American rare earths mining industry is getting the necessary
government support in the form of timely permits and loan
The US is way far
behind - part of it is that the US government does not
have enough people to actually do the job in a timely
matter - because they have cut back so much that the US
government is pretty ineffective, said Hedrick.
There are certain lawmakers making
an effort to propel American rare earth industry forward. In
June 2011, for example, the US Senate introduced two different
pieces of legislation meant to address the issue of rare earth
shortages in the US.
The first the Critical Minerals
Policy Act, introduced by Alaskan Republican Senator Lisa
Murkowski - is meant to address the issue of rare earth
shortages that could inhibit innovation in the 21st
What sets this bill apart is
not only a more comprehensive look at the various minerals we
depend on, but also its attention to the broader supply chain,
including [issuing permits] for domestic mineral production,
where the US is ranked last in the world, said Sen.
Murkowski in an official communique.
The second piece of
legislation the Critical Minerals and Materials
Promotion Act, introduced by Democratic Senator Jeff Bingaman,
of New Mexico seeks to address the issue of
creating profitable domestic rare earth mines for the US.
According to Sen. Bingamans
spokesperson, both legislations are currently being
reconsidered, in order to reconcile the differences between the
two, in the aim of creating one coherent bill, instead.
Meanwhile, in the House of Representatives, new legislation and
amendments are being considered that would change the rare
earth clauses of the National Defense Authorization Act.
Colorado Representative Mike
Coffman, a Republican, for instance, introduced two amendments
in December 2011 aiming to boost domestic stockpiles of rare
The first amendment requires the
Defense Logistics Agency (DLA) Strategic Materials to establish
an inventory of rare earth oxides, metals, alloys and magnets
for defence purposes. This would require the DLA to develop
steps to maintain a competitive, multi-source supply chain in
order to avoid reliance on one country.
The second amendment requires the
defence secretary to report back to Congress on the feasibility
of recycling, recovering and reprocessing rare earth elements
from defence facility fluorescent lighting, weapons systems,
neodymium iron boron magnets and commercial off-the-shelf
items, such as computer hard drives.
So, there is action in
Congress - but none of these legislative measures have yet
passed. And even with both arms of the US Congress working to
create stability and support for the rare earths mining
industry, Hedrick warns that if legislation does not move
forward quickly enough, the US will miss out on its opportunity
to gain grown in the rare earth sector.
We are at a critical
junction. Two things that will happen: one, we will just have
to do without minerals - not just rare earth metals -
but a whole bunch of them will be in short supply, he
said. And [what] will follow [is] that we will have to
pay significant additional amounts...