IM Rare Earths News in Brief 2 – 8 June

By James Sean Dickson
Published: Monday, 08 June 2015

Arafura reduces opex; Peak meets obligations for BFS funding, Rare Element streamlines Bear Lodge metallurgy.

ASX-listed Arafura Resources Ltd has reported a reduction in projected operating costs for its Nolans rare earths project in the Northern Territory, Australia.

Carried out as part of the definitive feasibility study on Nolans, metallurgical testwork has produced a 7.4% lower operating cost estimate of Australian dollar (A$) 14.51/kg ($11.05.tonne*) rare earths oxide equivalent (REO) at the commencement of nameplate production.

Arafura said that the decrease in costs is reflective of a material reduction in sulphuric acid and process waste residues. While projected opex costs have fallen, the expected capex with a 15% contingency has been revised up from A$1.408bn to A$1.437bn.

Commenting on the wider rare earths market, Arafura said: "The combination of new resource taxes, tighter environmental regulations and a shift from export control to production control will result in increased rare earths prices in the medium term as a consequence of a higher production cost base in China."

Also listed in Australia, Peak Resources Ltd has announced that the Appian Natural Resources Fund and the International Finance Corp. have advised the company that all regulatory approvals required for the first stage bankable feasibility study (BFS) funding.

Peak now intends to close A$29.5m in funding for the Ngulla rare earths project in Tanzania.

"We are very pleased to have been advised the required regulatory approvals have been received for the first stage of the BFS funding and we look forward to working with Appian, IFC and our respective advisers to closing the transaction," Darren Townsend, Peak’s managing director, said.

Meanwhile, NYSE-listed Rare Element Resources Ltd has streamlined the metallurgical processes on ore from its Bear Lodge rare earths project in Wyoming, US. The technology now uses significantly fewer mixers and settlers and utilises a new technique for the rapid stripping of loaded organic solvents without the use of strong acids.

"Over the last several months, we have expanded our patent-pending technology by identifying a process flow sheet that delivers multiple saleable products, both efficiently and in what we believe will be a very cost effective manner," Rare Element’s chief operating officer, Jaye Pickarts, said.

"By improving upon conventional solvent extraction (SX) technology and introducing this innovative method for stripping organic liquor outside the SX process, we expect to be able to meaningfully reduce the required SX capacity and significantly cut down on reagent and energy consumption," Pickarts added.

Thorium is to be removed, along with cerium at the start of the processing chain, to ensure lower reagent and energy consumption than would be the case if the low value products were included for processing until the end of metallurgical handling.

In China, Aluminium Corp. of China Ltd (Chinalco) is rumoured to be consolidating the largest rare earths company in Jiangsu province.

Reported in several Chinese media outlets, the Xuzhou Jinshi Pengyuan Rare Earth Material Co. (XJP) is to become a subsidiary of Chinalco, leaving all companies in the province now with the "big six" Chinese rare earths producers.

XJP is a rare earths smelter and separator. The company also produces neodymium-iron-boron (NdFeB) magnets, and has an annual capacity of 1,200 tpa rare earth metals and alloys and 400 tpa NdFeB magnets.

Rising Nonferrous Metals Share Co. Ltd is also understood to be consolidating companies within Jiangsu. A Chinalco employee told IM that while XJP is a subsidiary of Chinalco, they were unable to confirm the rumour.

*Conversion made June 2015