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These are just two of the 17 rare earth minerals whose scarcity and rising prices are opening new investment and job opportunities in SA.

Despite their name, rare earths are relatively common but not often found in the quantities required to build a mine. In the 1950s, SA was the biggest source of rare earth minerals but, for the past decade, China has been producing 95% of world supply. However, China has been limiting exports recently to secure its own supply and address environmental concerns. This is particularly worrying to the US because rare earths are irreplaceable in certain defence-related applications.

Expected shortages and new applications have doubled prices of some of these minerals since the middle of last year. In a presentation to the Rare Metals Summit in Washington on October 25, Australian- listed Lynas Corp COO Eric Noyrez said global demand would rise to about 190100t by 2014 from 136100t this year, mainly for use in magnets and batteries. By 2014 there would be a global shortfall of about 20000t.

The two biggest known rare earth projects coming on stream are Lynas Corp's Mount Weld mine in Western Australia and Molycorp's Mountain Pass mine in California, but these are not expected to produce enough to meet demand in four years .

SA is also moving to fill the gap, with plans to re open an old mine near Vanrhynsdorp in the Western Cape, which was formerly mined for thorium by an Anglo American subsidiary and closed in 1963, as well as another unmined deposit, further north in Namaqualand.

The Steenkampskraal mine near Vanrhynsdorp, owned by Rareco, is scheduled to return to production by late 2012.

Rareco had an unfortunate history when it was listed on the JSE between 1994 and 2004, as its plans to revive the old mine to take advantage of rising rare earths demand in 2000-2001 were frustrated by internal shareholder battles, and the collapse of rare earths prices.

Last year Toronto-listed Great Western Minerals Group signed an agreement with Rareco and took a 20% stake. They plan to refurbish the mine, which has its new-order mining right, to supply Great Western's magnetic alloy and battery alloy plants in the UK and the US.

The second project in the planning stage is Zandkopsdrift in the Northern Cape, owned by Frontier Rare Earths, which filed a prospectus a month ago ahead of a listing in Toronto. It also plans to start producing rare earths by the end of 2012 from the property, which could produce 20000t a year of rare earth oxides from a shallow open pit. Frontier chairman, Philip Kenny is also CEO of AIM-listed Firestone Diamonds.

Jack Lifton, of Technology Metals Research, a rare earths expert who visited SA in February to address an SA Institute of Mining & Metallurgy conference, is impressed by the grades of the two deposits. "Even without factoring in the extremes of concentrate value, there is still a greater likelihood of an SA deposit being able, within two or 2½ years, to produce a per kilogram value high enough to justify investment than in any other place in the non-Chinese world."

Lifton says Canada and SA are likely to be the leading producers of rare earth minerals in the long term. "Canada and SA are excellent places to seek out investments in rare earth supply. I guarantee the Chinese already know this."

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This article was published on 2010/11/12