Monday, August 31, 2009

"As hybrid cars gobble rare metals, shortage looms". And: "California mine digs in for "green" gold rush" (GS)

We got us a meme!
Most of our prior posts on rare earth elements can be found linked in last week's "Wind: "World faces hi-tech crunch as China eyes ban on rare metal exports" Two from Reuters:
The Prius hybrid automobile is popular for its fuel efficiency, but its electric motor and battery guzzle rare earth metals, a little-known class of elements found in a wide range of gadgets and consumer goods.

That makes Toyota's market-leading gasoline-electric hybrid car and other similar vehicles vulnerable to a supply crunch predicted by experts as China, the world's dominant rare earths producer, limits exports while global demand swells.

Worldwide demand for rare earths, covering 15 entries on the periodic table of elements, is expected to exceed supply by some 40,000 tonnes annually in several years unless major new production sources are developed. One promising U.S. source is a rare earths mine slated to reopen in California by 2012.

Among the rare earths that would be most affected in a shortage is neodymium, the key component of an alloy used to make the high-power, lightweight magnets for electric motors of hybrid cars, such as the Prius, Honda Insight and Ford Focus, as well as in generators for wind turbines.

Close cousins terbium and dysprosium are added in smaller amounts to the alloy to preserve neodymium's magnetic properties at high temperatures. Yet another rare earth metal, lanthanum, is a major ingredient for hybrid car batteries.

Production of both hybrids cars and wind turbines is expected to climb sharply amid the clamor for cleaner transportation and energy alternatives that reduce dependence on fossil fuels blamed for global climate change.

Toyota has 70 percent of the U.S. market for vehicles powered by a combination of an internal-combustion engine and electric motor. The Prius is its No. 1 hybrid seller.

Jack Lifton, an independent commodities consultant and strategic metals expert, calls the Prius "the biggest user of rare earths of any object in the world.">>>MORE

Privately held MolyCorp sports Goldman among it's investors. [go figure -ed]

The future of wind farms and hybrid cars may well hinge on what happens to a 55-acre (22.3-hectare) hole in the ground at the edge of California's high desert.

The open-pit mine at Mountain Pass, California, holds the world's richest proven reserve of "rare earth" metals, a family of minerals vital to producing the powerful, lightweight magnets used in the engines of Toyota Motor Corp's Prius and other hybrid vehicles as well as generators in wind turbines.

Seeking to replace China as the leading supplier of these scarce materials, Colorado-based Molycorp Minerals LLC plans to reopen its long-idled quarry to resume extracting and refining thousands of tons of rare earth ore in the next few years.

Last month, Molycorp reached a joint venture deal with Arnold Magnetic Technologies Corp. of Rochester, New York, to make "permanent" magnets from rare metals at Mountain Pass.

Backed by hundreds of millions of dollars from equity investors, including Goldman Sachs, Molycorp aims to avert a looming rare-earths supply crunch that threatens to muffle the green-technology boom.

"The world has been looking for an alternative to these rare-earth permanent magnets for over 20 years, and one has not been found," Molycorp chief executive Mark Smith said. "What Molycorp is proposing as a business strategy is to fill that supply chain and go all the way from mining to magnets."

Success hinges on Molycorp's ability to operate the mine and its processing facilities much more efficiently than in the past.

At the peak of its operations two decades ago, the mine produced 20,000 tonnes of rare earth oxides a year, accounting for the entire U.S. supply and about a third of the world's total. Most of the rest came from China.


But as Chinese production and exports grew through the 1990s, rare earth prices worldwide plunged, undercutting business for Molycorp, then owned by oil company Unocal....MUCH MORE