Rare earth mine creeps ahead

Rare Element Resources (RER) has announced it will spend the first nine months of 2019 completing a pilot plant campaign to verify all the steps in its proprietary process of separating rare earth elements. Whether the Bear Lodge Project is revived after that study will depend on an evaluation of the results.

“We’ve spent our funds wisely and made good progress in 2018 and we’re excited about seeing what the first six to nine months of 2019 show us,” says CEO Randy Scott.

The permitting process for the project was placed on hold in 2016, just a week after the Draft Environmental Impact Study was released, when RER found itself needing to conserve money.

But while many assumed the rare earths in the Bearlodge Mountains would stay where they were for the time being, 2017 brought a glimmer of hope to RER in the form of a contribution from Synchron, an affiliate of General Atomics that purchased 33.5 percent of the company’s issued common shares.

“We were provided with about $4.5 million at that point, from that transaction,” says Scott. RER set about deciding exactly what to do with the cash and started to put a plan together to advance the Bear Lodge Project on a focused approach.

“We’ve executed against that plan in 2018,” Scott says. “We focused on a couple of things: one, we wanted to have the investors in the company independently validate our technology, which is proprietary and we believe has some specific advantages from a technical, capital and operating cost perspective.”

To that end, since April 2018, RER has continued test work on its proprietary technology. The work was conducted by Umwelt-und Ingenieurtechnik GmbH Dresden (UIT), an affiliate of Synchron, and took place using UIT’s advanced mineral and materials research capabilities in Germany.

“We knew when we were talking to [Synchron] before the deal was finalized that this was a good marriage for both parties. Obviously they brought cash to us, but they have always said they are interested in seeing the project developed and interested in the technology and they of course have some pretty vast capabilities on the technical side from within the organization,” Scott says.

The work was successful, says Scott; “Also, we were able to validate and further develop our separation technology. We wanted to try to separate the rare earth elements into more pure constituents.”

In particular, the company wanted to better be able to separate neodymium and praseodymium (known as NdPr), the premier rare earth element used to make high-strength permanent magnets.

“The market for those is continuing to grow at a very rapid rate these days as the economy transitions from carbon-based into more electrical automobiles and everything else,” Scott says.

“That test work ended up being complete right at the end of the year and the board then got together and reviewed the results and decided it was in our best interests to continue to move forward with the project. We decided that we were going to scale up the test work that UIT had done into a pilot plant campaign,” Scott says.

“We’ve gone ahead in the last month and have a contract with UIT again to perform the pilot plant campaign for us. That campaign is already underway and we anticipate that it will be wrapping up sometime around the beginning of the fourth quarter of 2019.”

The results will steer RER’s path into the next year and beyond, says Scott.

“That is a key decision point for us. We’ll want to take a look at the results of that, analyze the results, take a look at some of the economics around it and then we’ll make some decisions about where we go after that,” he says.

While the testing was taking place, RER also continued its preparations for the permitting process. Though the company had intended to begin meeting with the Forest Service, DEQ and others to advance the permitting portion of the project after the Synchron deal was finalized, funding uncertainty continued to leave RER unsure it could see the process through.

“While we have not formally requested restart of the NEPA process and it’s likely that may be put on hold until we see the results of the pilot plant test work as well, we took some key steps in 2018 during the spring/summer/fall season to make sure our baseline environmental data stayed current so that when, and if, a decision is made to restart formally, we’re ready to go and we don’t have to go back and spend another year resampling,” Scott says.

During 2018, RER updated its environmental data at both the Bear Lodge Project in Sundance and in Upton. A hydrological evaluation was completed, two meteorological stations were reactivated, wildlife was monitored and vegetation surveys took place.

“We have had contractors working for us for the last eight or nine months now doing surveys,” he says.

“That data was captured by the consultants, they have finalized those reports now and we’re reviewing those reports, which as you might imagine are quite lengthy.”

All of this has been done, says Scott, to make sure RER is ready when the moment comes.

“Our thought process is that, if we are going to pull the trigger on the restart of the NEPA process, we want to make sure that it can be done in as timely a fashion as possible,” he explains.

“We decided to go ahead and spend a quite significant sum of money with the consultants doing the surveys now so that data will be fresh for the next year or two at least and would allow us to turn the crank if we decided to get going.”

When the results of the pilot plant campaign are received, there will be one final step before RER can pull that trigger.

“What we will want to do is make sure we have raised financing sufficient to be able to move forward with the project, and we would obviously raise that financing hopefully on the heels of a very positive result from the pilot plant test work,” he says.

“That would be the next step before finally committing to restart the project.”

The Forest Service confirms that it has not yet been asked to resume the permitting process, according to Scott Jacobson, Public Information Officer. As to what it would take to relaunch the process, he says:

“For us to get things going would really depend on what the company would propose to do. The company suspended operations three years ago so we would need to assemble a team of various specialists…review the company’s proposal and get the NEPA process started again.

“If the company decides to start up again, our timing would depend on if they would like to proceed with their plan of operations from three years ago, or if there are changes.”