rare earth processing overview
In 2014, Pele announced the expansion of its business model to include processing high-grade rare earth bearing monazite in Elliot Lake, Ontario, at its Eco Ridge Project. Management believes that monazite processing is the best way to achieve rare earth production outside China and kick start the sustainable development of a Canadian-based, low cost, early-to-market, Rare Earth Supply Chain.
Despite increasing demand for certain rare earths and billions of dollars invested to develop mining operations and processing facilities, there are no new hard rock rare earth mines outside China that have achieved profitable production. Challenges that have undermined the viability of new projects include: (1) high capital costs to construct hard rock mines, processing facilities, and associated infrastructure; (2) complex technical issues associated with process development unique to each deposit; (3) an environment of strongly down-trending rare earth prices; and (4) weak resource capital markets.
These profound market-related and technical challenges have created a formidable impediment to the development of new hard rock rare earth mines and highlight the need for a different approach to achieve low cost rare earth production outside China.
Benefits of monazite processing over hard rock mine development include:
- The very high rare earth grades in monazite allow for substantial production, especially the critical magnet materials neodymium and praseodymium, from relatively low tonnage;
- Low-tonnage, processing-only operations allow for sharply lower CAPEX than development of large-scale mining and processing operations;
- The metallurgical techniques for processing monazite are well established, allowing for reduced technical risk, shortened ramp-up times, and reliable, long term production of rare earths.
Pele’s monazite processing strategy is to collaborate with monazite suppliers, technical experts in processing, and rare earth end users to produce separated, high-purity, individual rare earth oxides that have much greater value than mixed rare earth concentrates, and can be used in downstream value added processing and manufacturing. Pele will source monazite from countries that embrace sustainable mining practices and are allied trading partners with Canada. Historically, commercial processing of monazite has been achieved by several companies and has provided a primary source of rare earths.
Pele continues to actively pursue a Rare Earth Processing Centre at Eco Ridge and has received monazite bearing mineral sands from current mining operations of a potential supplier for testing purposes. Pele has identified and engaged multiple potential monazite suppliers regarding long term off-take arrangements, and initiated discussions with government entities regarding the various regulatory requirements for monazite transportation and facilities development and retained a logistics expert to assist in the arrangements for importation and transportation of monazite.
Elliot Lake is the ideal location to host a rare earth processing center. It is Canada’s only proven historic rare earth mining and processing camp and has outstanding regional infrastructure including highways, railway, electricity, natural gas, airport, deep-water ports, and a qualified workforce. The region hosts vast undeveloped rare earth and uranium resources, such as those at Eco Ridge. The community supports Pele’s monazite processing strategy and has said so publicly.
Pele places great value on community relations and has prioritized constructive dialogue with local stakeholders since becoming active in Elliot Lake in 2006. Pele has received Letters of Support from representatives of the Municipal, Provincial, and Federal Governments and has underscored its commitment to work with First Nations with its appointment of Martin Cooper as Vice President of Indigenous Relations. Pele is engaged with all levels of government, local communities and First Nations, rare earth industry leaders, and end users of rare earths to advance the sustainable development of rare earth production in Canada.