Can The Mining Industry Help Other Industries Reduce Their ...

Can The Mining Industry Help OtherIndustries Reduce Their CarbonFootprint?... Yes!Ian London, P. Eng.Vice President Market DevelopmentAvalon Rare Metals Inc.PDAC 2009 – Climate Change WorkshopToronto March 4, 2009

formerly known as

Avalon Rare Metals Inc Avalon Rare Metals (AVL:TSX) is a Canadian juniormineral exploration and development company with aprimary focus on the rare metals and minerals Owns five rare metals and minerals projects in Canada,four of which are at an advanced stage of development Resources in increasing demand for high technology andenvironmentally-beneficial applications.

Rare Metals Project LocationsLithiumTantalum-CesiumAll 100% ownedTin-Indium4

What are Rare Earth Elements?(“REE”)Rare EarthElementsAMALGAMET CANADAOther rare metalsMarketing AgentsHeavy Rare EarthsLight REE’s:La= LanthanumCe= CeriumPr= PraseodymiumNd=NeodymiumSm= SamariumHeavy REE’s:Eu= EuropiumGd= GadoliniumTb=TerbiumDy= DysprosiumHo= HolmiumEr= ErbiumTm= ThuliumYb= YtterbiumLu= LutetiumY= YttriumNeodymium, Dysprosium, Terbium and Europium in highest demand

Today’s Outline Green Economy demand for magnets, electronics,batteries, glass Full supply chain GHG/carbon footprint needs tobe considered Glassmaking – a case study

Many clean energy technologies rely on raremetals (e.g. Nd, Dy, Ga, Li, and Tb) High strength REE magnets - direct drive wind generators. MRImachines REE phosphors - electronic components, instrument displaymonitors In-Ga for thin film solar panel, specialty glass substrates REE magnets for energy efficient brushless motors - industrialretrofits, elevators, air conditioners and home appliances Specialty composites using rare minerals such as calciumfeldspar – building materials, wind turbine vanes High strength/low weight construction materials - LiAl alloy Li-Ion energy storage devices to feed energy into the systemwhenever needed.

Green Economy - Growing Application ofREE Magnets in Electric Motors REE Magnets reduce electric motor size & weight andimprove efficiency Major new applications include: air conditioners, elevators, wind turbines, MRI machines Use of REE magnets in air conditioners can reduce powerconsumption by 50% with same performance HREE Dysprosium is key to making ‘heat resistant’magnets vital to automotive & other applications9

Major Rare Earth Applications:Hybrid CarsREE used in:• motors• MH battery• glass• autocatalyst• electronicsToyota’s globalhybrid salesforecast to growto 1 million peryearToyota Prius30kg (65lb) of REE10

Renewable Energy,Wireless CommunicationsAdvanced technologiesrequire high tech materials.PV, wind and wireless allultimately depend onminerals for theirperformance

Wind Power & Tidal Power Direct drive turbine with apermanent magnetgenerator eliminated needfor gear box. Increases reliabilityincreases mechanicalefficiency New 5 Mw wind turbineassemblies contain approx2000 kg Nd magnets

Energy Efficiency from Advanced Materials

Rare Earth Demand – automotive• In 2006, global car and light truck production approximated69,000,000 vehicles• Toyota has produced 1,000,000 hybrid vehicles , and expects toproduce 1,000,000 per year by 2011• General Motors: “By 2020...80% of vehicles will require somesort of hybridization/electrification”• As such, we’ll need to find:about 1,650,000 tonnes of Rare Earth production, ora 13 fold increase in mine production in just 12 years

China Dominates REE ProductionGlobal REE production by regionRoskill 2007 supply/demand forecastSource: USGS• China currently produces over 95% of global REE supply• Global REE market close to deficit• Chinese demand will exceed Chinese supply by 2012• China now imposing export quotas and tariffs on REE• New capacity needed from outside China in next 3 to 4 yrs.

Miners to the rescue

Miners can also enableCarbon SequestrationPotential for geological capture of CO 2

Carbon Sequestration Silicate minerals are good sinks for CO 2 Anorthosite (a calcium feldspar mineral) can beused as a carbon sink and produce alumina at thesame time:1 tonne anorthosite + 110 kg CO 2Alumina300 kg Silica490 kgCaCO 3250 kg

Mining and GHG ReductionCase Studies from the Glass Industry

Energy Use in GlassmakingT em p eratu re (C )1700165016001550150014501400135013001250Typical glassmaking temperatures and specific energyconsumption in container glass industryFusion TemperatureSpecific EnergyConsumption12108642S p ecific E nergy C o nsum ptio n(kW h/kg)120001920 1930 1940 1950 1960 1970 1980 1990 2000YearSource: G. Tackels, St. Gobain sa after Barton

What’s Wrong With These Equations? Silica + feldspar + soda ash + limestone + heat =Container glass Silica + kaolin + feldspar + limestone + dolomite +soda ash + borate + heat = E glassAnswer: Both produce significant volumes ofGHG emissions and consume excess energy_________

Batch Solution:30-day Anorthosite TrialMaterial Replaces Energy Kinetics Fe 2 O 3Ca-Feldspar Clay, borax ↓10+% No Difference Potentiallimestoneironto lower• Results based on late 2007/early 2008 trial at US glassmaker on an operatingfurnace Significant energy saved using calcium feldspar Reduction in CO 2 as no carbonates Reduction in materials, handling and transportation costs as solids fed intofurnace usable, no 14% contained water as with clay Same melting and product behaviour as existing formulation; No furnaceoperator problems Easier batching – fewer batch components

Mass Balance Improvements Effectively saved 8% in raw batch feed per day; Oneproduct displaced two feeds with same product output Significant savings in not having to procure, ship andmelt redundant material Reduced CO 2 , NO x as energy requirements reduced Reduced CO 2 as limestone demand reduced Reduced SO x as salt cake eliminated

Emissions and Cost Reductions CO 2 reduction -- 4990 tonnes SO x reduction --570 tonnes H 2 O reduction -- 2800 tonnes Saves $1 million per annum

NO x and Temperature Reduction -Lithium in Container GlassBase Glass +0.25% Li 2 O +0.4% Li 2 OT m ( 0 C) - ↓28 ↓78NO x (unit) - ↓20% ↓35% Similar or greater reductions observed for other glassesincorporating mixed alkali Li 2 O + (Na 2 O, K 2 O, CaO and/orB 2 O 3 ) additionsSource: P.A. Bingham & M. Marshall; Glass Technology, Vol. 46, No. 1, Feb. 2005

AVL resources strategically located toUS glass and ceramics marketsWinnipegSEPARATIONRAPIDSKenoraCanadian National RailwayKohlerThunderBayChicagoToledoTorontoWARRENTOWNSHIPMEXICOMonterreyTulsaDallasSpruce PineFELDSPARMINEGLASSPLANTCERAMICSPLANT

Whatever We Do…Good Practice = Good BusinessOperate in an environmentallyand socially responsiblemannerEmbrace a proactiveEmbrace a proactivecommunity engagementphilosophy

In Conclusion Can The Mining Industry Help Other IndustriesReduce Their Carbon Footprint?... Yes!

Thank youwww.raremetalblog.com