Clean Energy Technology

US Toll Free: +1 877 228 2034
Panama: +507 396 9011

As seen in the Miami Herald

A Basket
B Basket
C Basket
D Basket
Silver

DOE report finds 5 clean-energy related REEs at risk in short-term

Published December 27, 2011 | By Swiss Metal Assets

Rare Earth Elements

The substantial capex required for the development of a rare earths mine, compounded by major miners’ lack of interest in mining rare earths, may spell trouble in meeting future demand.

A report issued Thursday by the U.S. Department of Energy has determined supplies of five rare earths metals-dysprosium, terbium, europium, neodymium and yttrium-are at risk in the short term, potentially impacting clean energy technology deployment in the years ahead.

The 2011 Critical Minerals Strategy examined 16 elements for criticality in wind turbines, electric vehicles, photovoltaic cells and fluorescent lighting. Of those 16 elements, eight are rare earth metals valued for their unique magnetic, optical and catalytic properties.

Five rare earth elements used in magnets for wind turbines and electric vehicles or phosphors for energy-efficient lighting were found to be critical in the short term (present-2015).

Between the short term and the medium term (2015-2025), the importance to clean energy and supply risk shift for some materials.

Other elements-cerium, indium, lanthanum and tellurium-were found to be near-critical.

DOE’s strategy to address critical materials challenges rests on three pillars. To manage supply risk, multiple sources of materials are required. “This means taking steps to facilitate extraction, processing and manufacturing here in the United States, as well as encouraging other nations to expedite alternative supplies,” the report said. “In all cases, extraction, separation and processing should be done in an environmentally sound manner.

“Second, substitutes must be developed,” the report cautioned. “Research leading to material and technology substitutes will improve flexibility and help meet the materials needs of the clean energy economy.”

“Third, recycling, reuse and more efficient use could significantly lower world demand for newly extracted materials,” the DOE advised. “Research into recycling processes coupled with well-designed policies will help make recycling economically viable over time.”

The report also contains three in-depth technology analyses with the following conclusions:

· “Rare earth elements play an important role in petroleum refining, but the sector’s vulnerability to rare earth supply disruptions is limited.”

· “Manufacturers of wind power and electric vehicle technologies are pursuing strategies to respond to possible rare earth shortages. Permanent magnets containing neodymium and dysprosium are used in wind turbine generators and electric vehicle motors. Manufacturers of both technologies are current making decisions on future system design, trading off the performance benefits of neodymium and dysprosium against vulnerability to potential supply shortages.”

· “As lighting energy efficiency standards are implemented globally, heavy rare earths used in lightning phosphors may be in short supply. In the United States, two sets of lighting energy efficiency standards coming into effect in 2012 will likely lead to an increase in demand for fluorescent lamps containing phosphors made with europium, terbium and yttrium.”

In their analysis, DOE found R&D plays a central role in developing substitutes for rare earth elements. In the past year, the agency has increased its investment in magnet, motor and generator substitutes.

“The demand for key materials has also been driven largely by government regulation and policy,” the report observed.

“Issues surrounding critical materials touch on the missions of many federal agencies,” said the DOE. Since March 2010, an interagency working group on critical materials and their supply chains convened by the White House Office of Science and Technology Policy has been examining market risks, critical materials in emerging high-growth industries and opportunities for long term-benefit through innovation.

The report also found that, in general, mining and metal processing expertise “has gradually declined in countries of the Organization for Economic Co-operation and Development, although the need to develop and retain such expertise has received increasing attention in recent years.”

While the number of REO-producing firms located outside of China is small, the proliferation of new rare earth companies “could help ease market concentrations in the years ahead,” the DOE observed. However, “one of the most significant requirements in the rare earth supply chain is the amount of capital needed to commence mining and refining operations…”

“The extraction and, in particular, the processing of rare earth ore is extremely capital intensive, ranging from $100 million to $1 billion of capital expenditure depending on the location and production capacity,” the report noted. “Bringing a greenfield mine to production likely costs in excess of $1 billion.”

“The estimated financial investment needed just to prove the resource (e.g., exploration and drilling) can be up to $50 million,” said the DOE. “The up-front cost of production capacity can range from $15,000 to $40,000 per tonne of annual capacity.’

“Unlike other commodities, rare earth mining generally does not appeal to the major global mining firms because it is a relatively small market (about $3 billion in 2010) and is often less predictable and less transparent than other commodity markets,” the report said.

“Additionally, the processing of rare earth elements into high-purity REOs is fundamentally a chemical process that is often highly specialized to meet the needs of particular customers,” the study noted. “It requires unique mineral processing know-how that is not transferrable to other mining operations. These factors reduce the appeal of rare earths production to the major mining companies, leaving the field mostly to junior miners.”

The report observed that smaller mining companies face a number of challenges, including being less well-capitalized than the majors and may find it difficult to raise money from traditional market. Certain macroeconomic conditions, particularly tight credit and volatile equity markets, can contribute to these difficulties.

“Successful public flotations require fairly advanced operations with proven resources, a bankable feasibility study and often customer contracts or off-take agreements in place that ensure some level of revenue,” the agency said. The DOE noted that Molycorp and Lynas Corporation have the largest capitalizations, “reflecting in part their expansion of large established mines.”

By: Dorothy Kosich
Source: http://www.mineweb.com/mineweb/view/mineweb/en/page72102?oid=142195&sn=Detail&pid=102055

Posted in Interesting Articles | Tagged cerium, clean energy, Clean Energy Technology, Critical Materials, dysprosium, Electric Vehicles, europium, indium, investment, lanthanum, Mining Rare Earths, neodymium, Photovoltaic Cells, rare earth elements, rare earth metals, Rare Earth Mining, Rare Earth Ore, Rare Earth Shortages, Rare Earth Supply, Supply Risk, tellurium, terbium, U.S. Department of Energy, Wind Turbines, Yttrium

Critical Minerals, Elements, Metals, Materials

Published July 14, 2011 | By Swiss Metal Assets

In this article I am going to take a look at three reports covering what the US and Europe consider critical or strategic minerals and materials.

In its first Critical Materials Strategy, the U.S. Department of Energy (DOE) focused on materials used in four clean energy technologies:

wind turbines: permanent magnets
electric vehicles: permanent magnets & advanced batteries
solar cells: thin film semi conductors
energy efficient lighting: phosphors

The DOE says they selected these particular components for two reasons:

Deployment of the clean energy technologies that use them is projected to increase, perhaps significantly, in the short, medium and long term
Each uses significant quantities of rare earth metals or other key materials

In its report the DOE provided data for nine rare earth elements: yttrium, lanthanum, cerium, praseodymium, neodymium, samarium, europium, terbium and dysprosium as well as indium, gallium, tellurium, cobalt and lithium.

Five of the rare earth metals, dysprosium, neodymium, terbium, europium and yttrium as well as indium, were assessed as most critical in the short term. The DOE defines “criticality” as a measure that combines importance to the clean energy economy and risk of supply disruption.

Securing Materials for Emerging Technologies

A Report by the APS Panel on Public Affairs and the Materials Research Society coined the term “energy-critical element” (ECE) to describe a class of chemical elements that currently appear critical to one or more new, energy related technologies.

“Energy-related systems are typically materials intensive. As new technologies are widely deployed, significant quantities of the elements required to manufacture them will be needed. However, many of these unfamiliar elements are not presently mined, refined, or traded in large quantities, and, as a result, their availability might be constrained by many complex factors. A shortage of these energy-critical elements (ECEs) could significantly inhibit the adoption of otherwise game-changing energy technologies. This, in turn, would limit the competitiveness of U.S. industries and the domestic scientific enterprise and, eventually, diminish the quality of life in the United States.”

According to the APS and MRS report several factors can contribute to limiting the domestic availability of an ECE:

The element may not be abundant in the earth’s crust or might not be concentrated by geological processes

An element might only occur in a few economic deposits worldwide, production might be dominated by and, therefore, subject to manipulation by one or more countries â the United States already relies on other countries for more than 90% of most of the ECEs identified in the report

Many ECEs have, up to this point, been produced in relatively small quantities as by-products of primary metals mining and refining. Joint production complicates attempts to ramp up output by a large factor.

Because they are relatively scarce, extraction of ECEs often involves processing large amounts of material, sometimes in ways that do unacceptable environmental damage

The time required for production and utilization to adapt to fluctuations in price and availability of ECEs is long, making planning and investment difficult

This report was limited to elements that have the potential for major impact on energy systems and for which a significantly increased demand might strain supply, causing price increases or unavailability, thereby discouraging the use of some new technologies.

The focus of the report was on energy technologies with the potential for large-scale deployment so the elements they listed are energy critical:

Gallium, germanium, indium, selenium, silver, and tellurium employed in advanced photovoltaic solar cells, especially thin film photovoltaics.
Dysprosium, neodymium, praseodymium, samarium and cobalt used in high-strength permanent magnets for many energy related applications, such as wind turbines and hybrid automobiles.
Gadolinium (most REEs made this list) for its unusual paramagnetic qualities and europium and terbium for their role in managing the color of fluorescent lighting. Yttrium, another REE, is an important ingredient in energy-efficient solid-state lighting.
Lithium and lanthanum, used in high performance batteries.
Helium, required in cryogenics, energy research, advanced nuclear reactor designs, and manufacturing in the energy sector.
Platinum, palladium, and other PGEs, used as catalysts in fuel cells that may find wide applications in transportation. Cerium, a REE, is also used as an auto-emissions catalyst.
Rhenium, used in high performance alloys for advanced turbines.

The third report I looked at, “Critical Raw Materials for the EU” listed 14 raw materials which are deemed critical to the European Union (EU): antimony, beryllium, cobalt, fluorspar, gallium, germanium, graphite, indium, magnesium, niobium, platinum group metals, rare earths, tantalum and tungsten.

Raw materials are an essential part of both high tech products and every-day consumer products, such as mobile phones, thin layer photovoltaics, Lithium-ion batteries, fibre optic cable, synthetic fuels, among others. But their availability is increasingly under pressure according to a report published today by an expert group chaired by the European Commission. In this first ever overview on the state of access to raw materials in the EU, the experts label a selection of 14 raw materials as “critical” out of 41 minerals and metals analyzed. The growing demand for raw materials is driven by the growth of developing economies and new emerging technologies.

For the critical raw materials, their high supply risk is mainly due to the fact that a high share of the worldwide production mainly comes from a handful of countries, for example:

China: Rare Earths Elements (REE)

Russia, South Africa: Platinum Group Elements (PGE)

Democratic Republic of Congo: Cobalt

All four of the following critical materials appear on each list:

Rare Earth Elements (REE)
Cobalt
Platinum Group Elements (PGE)
Lithium

The key issues in regards to critical metals are:

Finite resources
Chinese market dominance in many sectors
Long lead times for mine development
Resource nationalism/country risk
High project development cost
Relentless demand for high tech consumer products
Ongoing material use research
Low substitutability
Environmental crackdowns
Low recycling rates
Lack of intellectual knowledge and operational expertise in the west

Certainly the rare earth elements, the platinum group of elements and lithium are going to continue receiving investor attention, they are absolutely vital to the continuance of our modern lifestyle. But there are two metals increasingly on my radar screen, one is on all three above critical metals lists and the other soon will be when/if production increases, and in this authors opinion, that’s very possible.

Cobalt

A critical or strategic material is a commodity whose lack of availability during a national emergency would seriously affect the economic, industrial, and defensive capability of a country.

The French Bureau de Recherches GÃ©ologiques et Minires rates high tech metals as critical, or not, based on three criteria:

Possibility (or not) of substitution
Irreplaceable functionality
Potential supply risks

Many countries classify cobalt as a critical or a strategic metal.

The US is the world’s largest consumer of cobalt and the US also considers cobalt a strategic metal. The US has no domestic production, the United States is 100% dependent on imports for its supply of primary cobalt, currently about 15% of U.S. cobalt consumption is from recycled scrap, resulting in a net import reliance of 85%.

Although cobalt is one of the 30 most abundant elements within the earthâs crust itâs low concentration (.002%) means itâs usually produced as a by-product â cobalt is mainly obtained as a by-product of copper and nickel mining activities.

Scandium

Scandium is a soft, light metal that might have applications in the aerospace industry. With a cost approaching $300 per gram scandium is too expensive for widespread use. Scandium is a byproduct from the extraction of other elements, uranium mining, nickel and cobalt laterite mines and is sold as scandium oxide.

The absence of reliable, secure, stable and long term production has limited commercial applications of scandium in most countries. This is despite a comprehensive body of research and a large number of patents which identify significant benefits for the use of scandium over other elements.

Particularly promising are the properties of :

Stabilizing zirconia: Scandia stabilized zirconia has a growing market demand for use as a high efficiency electrolyte in solid oxide fuel cells
Scandium-aluminum alloys will be important in the manufacture of fuel cells
Strengthening aluminum alloys (0.5% scandium) that could replace entire fleets with much cheaper, lighter and stronger aircraft
Alloys of scandium and aluminum are used in some kinds of athletic equipment, such as aluminum baseball bats, bicycle frames and lacrosse sticks
Scandium iodide (ScI3) is added to mercury vapor lamps so that they will emit light that closely resembles sunlight

Conclusion

The REEs, PGEs, Lithium and Cobalt are all truly critical to the functioning of our modern society. It’s easy to see why they are classified as critical or strategic. Scandium will increasingly find its way into our everyday lives and undoubtedly take its place on the various critical metal lists.

Access to raw materials at competitive prices has become essential to the functioning of all industrialized economies. Cobalt is one of those raw materials, so too will be Scandium.

Are these two critical metals on your radar screen?

If not, maybe they should be.

Richard Mills - Ahead of the Herd | July 14, 2011