Lynas (ASX:LYC) is running the ruler over acquisitions, including ionic clay projects, to enhance flagship hard rock operations at Mt Weld in WA.
The 15 rare earths are categorised into ‘lights’ and ‘heavies’. Heavies are generally less common and more expensive.
The ionic clay deposits, while very low grade, typically have more of the heavies, which are used in the production of high-performance permanent magnets.
Rare earth permanent magnets are a crucial component in wind turbines and in the drive train of hybrid and electric vehicles.
There’s a couple of kilos of rare earths magnets in every EV, and about a tonne in every MW of power produced by wind turbines.
China, which dominates global REE mining and processing, gets most of its supply from ionic deposits in Southern China and neighbouring Myanmar.
Finding a complementary clay deposit for the light-dominant Mt Weld “is certainly what we are looking at”, LYC boss Amanda Lacaze told Stockhead at the Diggers & Dealers Mining Forum in Kalgoorlie.
“Ionic clay processing has had a bad rep for many years for the way it was originally prosecuted in China, where they basically just pump the earth full of ammonium sulfate and catch the minerals as they leached out,” Lacaze says.
“But there are better ways of doing it today. It will remain an important source.”
Lacaze says LYC – the Western world’s only rare earths producer of scale — is always open to partnering, offtake agreements, and acquisitions.
“It is to our benefit for the whole of the industry outside of China to grow,” she says.Is there room for another large Western rare earths producer?
LYC currently building out its mining and downstream capacity across the world. But the road was a tough one, partially due to China’s tight control over market pricing.
Lacaze was the driving force behind the revival of LYC, which death-spiralled from multi-billion-dollar highflyer in 2011 to a valuation of just $3m in 2015.
It is now worth $6.5bn.
“We’ve been in production for a decade and have faced every type of challenge that could be thrown at us,” Lacaze says.
“I hope there is room for more Western companies because the textbooks are right – monopoly markets are not healthy markets. With more competition everyone in the industry benefits.
“But the barriers to entry are high. New entrants will need to be creative in the way they enter the market, but I am hopeful we will have a more robust outside-of-China market industry.”