Rare Earths

Rare Earth Industry

Rare earths are essential in our modern world. They enable technology to be smaller, lighter and more efficient, and are a key component in the manufacture of clean energy and high end technology solutions.

The vital role rare earths play in the manufacturing of hybrid and electric vehicles and other high tech applications has prompted countries to seek long term sustainable supplies to support domestic industries.

China is the dominant force in the rare earth industry, supplying approximately 90% of global demand and consuming approximately 70% of global supply. Realising the significant national economic benefits and the interdependence of a diverse range of downstream industries, the Chinese Government continues to implement measures to maintain its dominant position. These measures include national industry consolidation and stockpiling of rare earths such as dysprosium to sustain local supplies.

As a result of China’s rare earth export restrictions in 2010 and 2011, several countries including Japan and the United States (US) filed a dispute with the World Trade Organisation (WTO) that the restrictions breached its trade regulations. In 2015, the WTO ruled in favour of Japan and the US instructing China to remove its export quotas. Following the decision China removed the export quotas, however has since implemented several other measures to control global supply including restriction on mining licences to six consolidated entities, separation quotas, VAT on concentrate and resource taxes.

Of global supply, approximately 30% is estimated to be produced illegally in China. The irreversible environmental damage and sterilisation of future rare earth resources has triggered a heavy clamp down on these illegal activities by the Chinese Government. This illegal production is primarily focussed on HREs, such as dysprosium and terbium, with global supplies reliant on this illegal source.

Supplies of HREs from China are likely to become scarcer, with market commentators forecasting China’s HRE resources will be exhausted in 10-20 years at current rates of exploitation. Furthermore, the Chinese Government continues to consolidate the industry into six rare earth producers to promote domestic downstream value added production and assist in curbing illegal mining and processing.

The drive to reduce the world’s dependence upon fossil fuels and decrease carbon emissions, coupled with the growing demand for technology that is faster, smaller and more efficient, is expected to foster significant growth in the rare earths market in the coming decade. With primary approvals, community support and the use of mining best practices Northern Minerals is positioned to become the first significant world producer of dysprosium outside of China.

What is dysprosium?

An essential element in the production of NdFeB permanent magnets. Dysprosium makes magnets long lasting and able to retain efficiency at extremely high temperatures, critical in the production of:

  • Hybrid and electric vehicles
  • Wind turbines
  • Miniaturisation electronics
  • Radiation detection equipment
  • Refractive glass material
What is lutetium?

One of the least abundant rare earth elements and is essential in the production of:

  • Detectors used in PET scanners
  • Catalysts in the chemical industry
  • Using lutetium in PET scanners delivers superior performance by increasing detection efficiency and shortening scan times reducing patient’s exposure to radiation.
What is terbium?

Is one of the rarest of the lanthanides and is often substituted with dysprosium, due to the similar physical and chemical properties. It is used for the coloured phosphors it produces and in permanent magnets, in the production of:

  • Actuators and sonar transceivers
  • Xray screens
  • Hybrid cars and wind turbines
  • Stabiliser in fuel cells
  • Televisions
Strategy

Northern Minerals is positioned to become the world’s first significant producer of dysprosium outside of China. Accounting for 60% of the Browns Range Project’s (the Project) revenue, dysprosium is the key value driver of the Project and is at the core of Northern Minerals’ marketing strategy. With a high value, high purity, dysprosium rich product, the Company is set to become a long term and reliable supplier of dysprosium and other critical heavy rare earths to world markets.

The Project is a standout amongst its peers. Its xenotime mineralisation is a proven source of supply; its richness in dysprosium, and the ability to upgrade the ore 30 times through beneficiation, clearly sets it apart. This coupled with the Project’s advanced stage of licencing and future exploration potential puts its ahead of many of its competitors.

 

During the pilot plant stage, the Northern Minerals will supply a mixed RE carbonate to the market. Once in full production the Company plans to deliver a range of products to market, including a mixed RE carbonate, individual RE oxides and DyFe metal. The mixed RE carbonate will be produced at the Project, with the additional two products to be produced via toll treating agreements with separators and metal makers. This strategy has advantages by allowing Northern Minerals to diversify supply, expand its potential customer base and provide flexibility when evaluating offtake options.

Northern Minerals engages regularly with potential offtake partners and global rare earth industry participants. This has advanced direct offtake and toll-separation discussions, as well as ensured that the final mixed RE carbonate product meets specifications for further downstream processing.

The Company has hosted visits to the Project site to show the extent of the xenotime mineralisation and to the pilot plant campaigns to demonstrate its ability to significantly concentrate, and process the ore into a high purity product suitable for downstream separation. Samples of the mixed RE carbonate produced during these campaigns have been supplied to several parties for evaluation to ensure it meets potential customer requirements.

Northern Minerals has received positive feedback from the market and potential offtake partners in response to its new business plan to develop the Project in three stages. The Company is currently working to finalise an offtake agreement for the pilot plant detailed in stage one of the business plan.

Offtake

Northern Minerals has entered into an offtake agreement with thyssenkrupp Materials Trading GmbH (thyssenkrupp) for all mixed heavy rare earth carbonate from the Browns Range Pilot Plant Project, including all stockpiled product.

The agreement also includes an option for thyssenkrupp to participate in the potential full-scale project