A pilot ore processing facility in Wheat Ridge expects to go live early this year, part of a larger effort to put the U.S. back in the game for producing rare earth metals within its borders.
“Our Colorado pilot plant will be the first processing facility outside of China with the ability to separate the full range of rare earths — lights, mids and heavies,” said Pini Althaus, CEO of USA Rare Earth, which is teaming with the Texas Mineral Resources Corp. to build the plant.
Modern cell phones use 9 of the 17 rare earth elements, a key reason people don’t have to carry around a one-pound brick phone anymore. Modern wind turbines wouldn’t be cost-effective without the powerful magnets made from rare earth elements. And the luminesce of rare earth materials makes night-vision goggles possible, not to mention all those big-screen televisions people will use to watch Super Bowl LIV.
“The rare earths are like the vitamins of the manufacturing industry,” said Corby Anderson, the Harrison Western Professor of Metallurgical and Materials Engineering at the Colorado School of Mines in Golden.
Problem is, China has stockpiled all the nutrients, and the U.S., highly deficient, has the equivalent of scurvy.
China controls 80% to 90% of the rare earth market and for some elements, it has 99% control. Even when other countries mine their own deposits, the ore often must go through China for processing.
Effectively, the U.S. and much of the world is completely dependent on China for materials that are shaping the economy of the future.
Rare earth elements, despite their name, aren’t that rare. The members of the lanthanide series pepper the earth’s crust and are more common than gold and platinum. But deposits that are concentrated enough to mine economically are special.
Althaus said the Texas Mineral Resources Corp. is sitting on the motherlode at the Round Top Mine in Hudspeth County, about 85 miles southeast of El Paso.
“We have one of the largest and most diversified rare earth projects in the world,” Althaus said.
The mine was originally developed for its beryllium in the 1980s with not much thought was given to the associated rare earth elements. The ore at the mine is fairly uniform and contains 15 of the 17 rare earth elements, including the ones needed to make the most powerful magnets.
But the ore is also diversified. It has lithium, a critical component in modern batteries, and aluminum sulfates, which are used in water treatment plants. Little of it ends up as a waste product.
The mine will heap leach the ore and extract a concentrate for processing. The technology the pilot plant will use to separate and concentrate rare earth elements is called ion exchange and continuous ion chromatography.
It is well established and some of it dates back to the Manhattan Project, when scientists were trying to come up with a way to purify uranium for use in the atom bomb.
A key task for the Wheat Ridge pilot plant, which will employ up to 15 workers, will be finding a cost-effective way to remove the lithium and aluminum sulfates as well.
“The technology is well-practiced,” said Deepak Malhotra, owner of Resource Development Inc. in Wheat Ridge. “We have to adopt the technology to this ore.”
RDI will set up the pilot plant and hone the process. Althaus said the engineering expertise available through people like Malhorta and the nearby Colorado School of Mines is why USA Rare Earth chose to locate the facility in Wheat Ridge.
USA Rare Earth estimates bringing the mine back into full production will cost $350 million, including leaching and processing facilities. It expects to mine 20,000 tons a year of ore, which will generate 2,313 tons of marketable rare earth products, plus another 9,800 tons of lithium carbonate.
Althaus estimates Round Top will operate at a cost of $15 a ton. By contrast, the Mountain Pass Mine in California, formerly owned by Molycorp of Greenwood Village, was producing at $80 a ton.
That mine at one time once was the world’s largest producer of rare earth metals but couldn’t compete. Chinese producers at various times boosted supply and pushed down prices, which eventually contributed to Molycorp filing for bankruptcy protection in 2015.
“We are among the lowest cost rare earth projects outside of China,” Althaus said.
Once the pilot plant hones the process, its equipment will relocate to the Round Top Mine and handle the ore produced there, said Malhorta.
But there is also demand for processing facilities and rare earth expertise located outside of China. Another path the company may pursue is to keep a facility open in Wheat Ridge and process rare earth solutions from other countries, including Australia, Althaus said.
“It might be the case that other feedstocks could be processed in Colorado,” added Dan McGroarty, director of government and regulatory affairs at USA Rare Earth.
Anderson said he visited China in October and was stunned by the advances he witnessed. Any company or country will be hard-pressed to match the expertise the Chinese have developed in rare earth mining and metallurgy, he said.
“What is rare is the talent and understanding of what to do with them,” he said of the rare earth elements.
A couple of rare earth elements are so widely available they are priced low, and a few still lack widespread commercial uses. Simply having the elements available will allow material scientists to have a stock to work with as they develop new applications and products.
To the degree that China controls more of those elements, the greater the odds they will find new and innovative uses for them. And China has made it a goal not to just manufacture products for other countries, but to develop new and cutting-edge technologies.
There is the question of national defense, with rare earth metals used in laser-range finders, communication systems and guided-missiles, among several other things. The Department of Defense is trying to address that concern by building stockpiles.
Althaus said about half of rare earth materials go into products tied to the green economy, including the powerful magnets critical for modern wind turbines and various components in electric vehicles.
China has enough supply to keep rivals at bay if it feels threatened, or to cut countries off, which it did briefly once to make a point with Japan. Last June, Beijing raised tariffs on rare earth ores imported from the U.S. from 10% to 25%, making it more expensive to process the material.
That’s why Althaus said it is critical to have multiple marketable products generated from the Round Top Mine. If rare earth prices collapse, then lithium, which is in heavy demand for use in electric car batteries, could support production. The company expects to produce enough lithium to become the second-largest domestic source.
Rare earth elements were once considered an unwanted byproduct of processing uranium until the phosphorescent properties of europium were deployed in tubes that made color television possible in the 1960s.
For years, the U.S. dominated the rare earth metal market, but that hasn’t been the case in decades. Althaus credits the Chinese for being farsighted enough to realize how important rare earth metals would become and taking the steps necessary to dominate.
Even if China doesn’t use its dominance in rare earth materials as a geopolitical or economic lever, the expectation is that ever-increasing demand over time will soak up the available supply. China will satisfy domestic demand first and foremost.
“You can’t force a country to export a natural resource. One day that will happen with China,” said McGroarty.
