Australia Challenges China’s Stranglehold on Rare Earths, Critical for ‘Green’ Energy

Australian mining company Arafura Resources said on Wednesday that an enormous deposit of rare earth minerals discovered in central Australia, developed with the aid of a $30 million grant from the federal government, could help to significantly weaken Communist China’s stranglehold on the rare-earths supply – a class of minerals vitally important to “green energy” projects around the world.

China currently controls about 80 percent of the rare-earths market, but the Australian government has committed $240 million in funding to support projects that could diversify the supply chain. Arafura Resources will use its $30 million grant to build a rare-earths separation plant at its Nolans Project in the Northern Territory.

The Nolans Project, located about 85 miles north of Alice Springs, boasts one of the world’s largest deposits of phosphate-uranium-thorium, located in an accessible area that can be developed with modest environmental impact – although local regulators and environmental activists have expressed some concerns about the size of the 4.8 gigaliter groundwater license required for the project.

The separation plant under construction by Arafura will be only the second of its type to be located outside China.

Arafura managing director Gavin Lockyer told Australia’s ABC News on Wednesday that the separation plant is “where all the real value-add is done to our product.”

“You’ve only got to look at the geopolitical situation at the moment, where, globally, companies are trying to diversify supply chains. The world has been wholly reliant on one supplier,” Lockyer pointed out, referring to China.

“The wind is behind us in terms of geopolitical activity at the moment. Around the globe customers are looking to diversify their supply chains, we fit right into that space,” he said.

The minerals produced by the Nolans Project will be useful in building electric cars, wind turbines, and solar panels. One of the top customers will be South Korea, whose government signed agreements with Arafura in February to help develop the project.

Arafura chairman Mark Southey called the agreement with South Korea “another milestone that indicates the global significance of Nolans, and international interest in the project’s capacity to provide a reliable, secure supply of what is a critical product.”

Australian Prime Minister Scott Morrison announced several other grants for rare-earths refining last week, including projects to refine nickel, manganese, cobalt, and vanadium for batteries and power grids.

“These projects are not only game-changers for the local region with the creation of new jobs, they will also open up incredible export opportunities,” said Australian Industry, Energy, and Emissions Reduction Minister Angus Taylor.

U.S. companies are also working on rare-earths projects, including a promising find at the La Paz Rare Earths Project in Arizona. The American Rare Earths Ltd. corporation said on Thursday that La Paz is “on track to become one of the largest rare earth projects in North America.”

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