Sumitomo confirms test production of Kazakh rare earths

Published: Friday, 17 October 2014

Through its JV with Kazatomprom, the company is preparing to go into commercial production of rare earths, most likely targeting Japanese demand driven by the advanced electronic market. However, project delays have cast doubts on targeted production, which was due to begin in 2013.

By Julian Ryall and Hanna Lange-Chenier

Japan's Sumitomo Corp. has commenced test production of rare earth elements in its joint venture (JV) with Kazatomprom, the national atomic energy company of Kazakhstan.

In a statement sent to IM, a spokesperson for Sumitomo in Tokyo confirmed: "Currently, we are producing a small amount of rare earth materials on a trial basis since this June, and we are now making preparations to go into commercial production."

Exports to Japan had been due to start in 2013, suggesting that the project is at present behind schedule.

The two companies set up Summit Atom Rare Earth Co. LLP (SARECO) in 2010 to recover rare earth elements within residues from Kazatomprom's uranium mines.

The JV company built a new factory in 2012 to work alongside one of Kazatomprom’s existing facilities, and in the same year announced an annual output target of 1,500 tonnes rare earth oxides in its initial years of operations, to be scaled up to 3,000 tonnes by 2015 and 5,000-6,000 tonnes by 2017 according to a SARECO announcement.

The JV did not reply to requests for other information on the progress it has made to date, including the minerals recovered and whether the output has met expectations.

"My guess is what they’re doing is waiting for assembly, because it takes money to get revamped equipment," a US-based rare earths expert told IM, implying that Kazatomprom’s existing facilities need an upgrade before they can reach full commercial production capacity.

"It was a former Soviet Union mine and production plant, but they closed that up when the Chinese began to take over the rare earths market and it has been sitting there for a while," the expert added.

Rare earths are in high demand in Japan because of their applications in advanced electronic devices, plus hybrid and electric vehicles.

SARECO has said it hopes to build a production plant for separating rare earth oxides and metals from ore concentrate by 2016, and start producing rare earth elements permanent magnets by 2018, but the delays cast doubt on these expectations.

"They could possibly be a force in the market somewhere down the road," the expert told IM. "How much of a profit they could make, it’s hard to say. The labour there is cheap, and the stuff is right there. The process there is pretty much controlled thanks to the Soviet Union way back when."

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