Earths - Avalon Rare Metals

THE RACE FOR RARE
e
Rare earths are where you find them, and
for Avalon Rare Metals that has turned
out to be near Great Slave Lake in the
Northwest Territories. These cabins on the
company’s development site make for an
iconic Canadian outpost.
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BUSINESS | THIS TEXT CHANGES EACH ISSUE
arths
By Tim Lougheed
Toronto’s Avalon Rare Metals has joined the global
race to extract rare earth chemicals - key elements
in many energy -generating green technologies.
FEBRUARY 2012 CANADIAN CHEMICAL NEWS 23

H
umanity’s longstanding love affair with gold may
not have waned, but we are being wooed by some
serious rivals in the periodic table. They are the
rare earths, which are actually metals and not
all that rare. These 17 elements are appearing in
more and more of our high technology hardware, particularly
the latest generation of green energy-generating
technology. And with more than 95 per cent of the world’s
rare earth production taking place within China, which has
announced its intention to reserve that supply for its own
growing use, the hunt is on to diversify the world market for
these hot commodities.
Such dramatic attention to rare earths is comparatively
recent. They have often been regarded by prospectors as little
more than a nuisance, comparatively useless materials that
interfere with the refining of tantalum or niobium, the kinds
of metals that really make money. In fact, until the 1980s the
world’s largest source of rare earths was a mine in California’s
Mojave Desert, which was shut down as demand tapered off.
By 2010, however, Colorado Congressman Mike Coffman
had introduced American legislation that would brand
rare earths as economically strategic. “Our nation must act
to protect our security interests with regard to rare earth
elements,” Coffman said last year. “China is neither an ally
of the United States nor is it a reliable trade partner when
it comes to these strategic metals.” Dubbed RESTART,
for Rare Earths Supply-Chain Technology and Resources
Transformation Act, the proposal would promote the development
of all relevant exploration, mining and processing
capacity. The move parallels the revival of output from the
Mojave Desert mine, which is expected to ramp up sharply
in the next few years. Meanwhile, companies are scouring
obscure corners of the globe elsewhere to investigate other
sources of rare earths.
One of the most promising of those sites is near Great Slave
Lake in Canada’s Northwest Territories. Known formally as
the Nechalacho Rare Earth Elements Deposit, it is located
at Thor Lake, about 200 kilometres east of Yellowknife. The
site was initially surveyed in the 1930s, when all that was in
evidence was a large body of granite and gabbro, a form of
igneous rock comparable to basalt. By the 1970s, aerial surveys
with a gamma ray spectrometer showed high radiometric
values raised the possibility of uranium. The readings were
actually caused by thorium, which turned out to be affiliated
with a substantial collection of rare earths.
That survey and the ensuing discovery was made by
Highwood Resources, a predecessor to Vancouver-based
Beta Minerals, which held the mining lease on the property.
Over the next 30 years, it would invest some $12 million to
assess the rare earths potential of Thor Lake, sinking some
200 test holes. Nevertheless, there was little incentive for
more ambitious development while the price of most rare
earths remained low and the logistics of extracting them
from such an isolated location remained daunting.
By 2005, representatives of Toronto-based Avalon Rare
Metals were prepared to adopt a different perspective and
the company acquired the title to Thor Lake from Beta. This
move was spearheaded by Avalon CEO Don Bubar, who has
subsequently been lauded for his prescience with regard to
the demand for rare earths.
Among those at the heart of this strategic acquisition is
Bill Mercer, who has headed up the Thor Lake project for
Avalon since 2007. He explains that in just a few years, the
demand for rare earths has been nurtured by a new generation
of consumer products that take advantage of these
elements. A typical example is an innovative electric motor
introduced by the U.K.-based firm Dyson, which has used it
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BUSINESS | RARE EARTHS
1
(1) Senior geologist and
camp manager Chris Pedersen
considers some of Avalon
Rare Metals’ collection of
earth samples with project
geologist Martin Heiligmann.
(2) An Avalon geologist logs
information collected from
drill cores.
2
to transform such mundane products as vacuum cleaners and
table fans. The motor boasts remarkable speed and efficiency
because its electrical contacts are suspended by powerful
magnets, made from the rare earth neodymium.
The ionic properties of that element, as well as samarium,
praseodymium and dysprosium, make for some of the
strongest known magnets, including some that function
at temperatures high enough to remain viable in harsher
settings like automobile engines. Such properties also make
it possible for at least 11 rare earths to enhance the optical
amplification by materials that generate laser beams. This
technology, which a few decades ago would have been a
rarity outside of a formal research setting, now crops up in
all manner of electronic appliances, from children’s video
games to office projector displays.
These new applications have expanded the market for
rare earths, although Mercer points out that it remains much
smaller than more primary metals such as copper. The latter
might see annual global production of 15 million tonnes of
production, while rare earths would be about one per cent
of that volume. However, these elements could fetch a
price that is 10 times higher, which is one of the key factors
behind Avalon’s push in Thor Lake.
Even so, Bubar suggests that the site may not be delivering
any product until 2016, although he noted that the company
would like to accelerate that timeline if possible. The wait
reflects the challenges posed by rare earths, which cannot
only be difficult to find, but even more difficult to extract
in a usable form. “These elements tend to be stored in very
refractory minerals,” says Jim Franklin, an exploration
FEBRUARY 2012 CANADIAN CHEMICAL NEWS 25

ENERGY
PRODUCTION
ENERGY
REDUCTION
ENERGY
EFFICIENCY
LIFESTYLE
PETROLEUM
REFINING
La
HIGH-POWERED
ELECTRIC MOTORS
Dy
Nd
NEW GENERATION
VEHICLES
La
Tb
UV FILTERS
IN GLASS
Ce
REDUCING FUEL
CONSUMPTION
Nd
LIGHTER
VEHICLES IMPROVED
PERFORMANCE
Dy
GENERATION
VEHICLES
Nd Sm
RECHARGEABLE
BATTERIES
La
ENERGY-EFFICIENT
LIGHTING
COLOUS SCREEN
LCDS/PDPS
Eu Tb Y
COMPONENTS TO
HARDWARE
Nd
MEDICAL
SERVICES
Pr Eu Nd Gd
Rare earth elements
are especially useful
in a new generation
of consumer products
to boost speed
and efficiency as
well as improve
product efficacy .
RARE
IDIOSYNCRASIES
La (Lanthanum) Nd (Neodymium) Dy (Dysprosium) Tb (Terbium) Ce (Cerium)
Sm (Samarium) Pr (Praseodymium) Eu (Europium) Y (Yttrium) Gd (Gadolium)
Most of the rare earths consist of the elements
between the lanthanum (atomic number 57) and
lutetium (atomic number 71), with two outliers:
scandium (atomic number 21) and yttrium (atomic
number 39). In spite of their collective name, most
of them are as plentiful in the earth’s crust as copper.
However, they are much more widely dispersed,
seldom occurring in concentrations that would allow
for easy detection or high-volume extraction.
Such dispersal is related to the accepted
account of their origins, which begin hundreds of
kilometres deep in the earth’s mantle, from which
they are thrust up at high velocity. This rapid flow
spreads them thinly near the surface, where they
can occupy mineral bodies that are a kilometre or
more across. In addition, many of those minerals
are refractory, a quality that determines how
readily they break down under chemical or physical
action. A typical example is zircon, which resists
erosion so well that it is often used to calibrate
measurements of 'deep time,' which determine the
age of geological features.
Rare earths accommodate such minerals because
of their signal feature, an unexpected decrease
in the radii of the ionic forms of these atoms. This
results in those rare earths with lower atomic
numbers and atomic weights actually having larger
atoms than elements that are higher in the periodic
table. Consequently, the heavier a rare earth, the
more tightly it will bind to other atoms and the more
difficult it will be to separate them.
MEDICAL
SERVICES
Ce
geologist who spent much of his career with the Geological Survey of
Canada. “They just don’t dissolve very easily. As a result, a standard
analysis that involves an acidic dissolution of the rock doesn’t necessarily
break them down.”
According to Franklin, commercially viable techniques for analyzing
these minerals did not appear until the 1990s, with the advent of induction
coupled plasma emission spectroscopy. This approach is now
regularly used to identify the presence of rare earths at levels as low as
parts per trillion, at a cost of less than $100 per sample.
Even so, Mercer adds that life remains complicated when it comes to
extracting and refining individual rare earths. Avalon expects the Thor
Lake development to include froth floatation, a process for separating
these metals from the surrounding material based on its tolerance for the
presence of water. It can be a messy business, one that has been met with
new environmental regulations in the United States. However, he and
Franklin remain confident that a steady market pull will ensure that these
restrictions do not restrain the company’s efforts; the find is simply too
rich to ignore. “It has all the rare earths, but it also has what geologists call
high field strength elements, which are zirconium, niobium, hafnium, and
tantalum,” says Mercer. “Gallium also tends to be enriched in it.”
Moreover, the concentration of rare earths at this site is as much as three
orders of magnitude greater than those found in the Chinese deposits. That
bodes well for responding to observers who fear that there simply will not
be enough rare earths around to go into the growing assortment of devices
that rely on these elements. And Franklin insists that neither these devices
nor the metals will ultimately become priced out of reach, now that the
rush for rare earths is on. “For varying reasons, commodities have this
cyclical approach,” he says. “Uranium goes through cycles; gold is clearly
well up in one right now. It’s a supply and demand thing. Right now people
are worried about the supply. We will find lots of rare earths,” he says.
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