Astute reader may have noticed we've had no comment on "Ukrainian rare earths". The headline is accurate.
However, Ukraine does have $10 - 12 trillion of other resources: titanium, iron, neon, nickel and lithium (largest minable deposit in Europe.)
Throw in the beryllium, niobium, tantalum, titanium and cobalt, along with uranium and feldspar and it starts adding up.
From IEEE Spectrum, March 7:
When a seemingly routine Oval Office press conference degenerated into a shouting match on 28 February, the world looked on in astonishment. That is, except for actual experts in rare earths and other critical materials, who understood all along that the proposed “deal” that motivated the press conference was nonsensical and could only be viewed as political theater.
The meeting was supposed to announce an agreement under which Ukraine would provide U.S. companies with access to critical minerals deposits in exchange for the tens of billions of dollars in military aid already provided by the U.S. government. According to the Center for Strategic and International Studies, the agreement would have established “a reconstruction investment fund with joint U.S. and Ukraine ownership. Ukraine will contribute 50 percent of all revenues earned from the future monetization of all Ukrainian government-owned natural resource assets into the fund.” Ukraine has substantial reserves or deposits of lithium, graphite, manganese, titanium, gallium, and nickel. However, in describing the proposed deal, president Donald J. Trump and other principals quickly zeroed in on the rare earths, for which the US has for years been spending billions of dollars in an attempt to secure stable supplies.
The Trump administration, like those before it, seems to grasp the importance of these materials. At his confirmation hearing, Secretary of State Marco Rubio said, “If we stay on the road we’re on right now, in less than 10 years, virtually everything that matters to us in life will depend on whether China will allow us to have it or not … They have come to dominate the critical-mineral industry supplies throughout the world.”
The Ukraine rare-earths deal now seems endangered, to put it mildly. But its apparent failure—and the way it failed—is revealing of how the Trump administration is likely to pursue supplies of strategically vital rare earths and other critical materials in the context of trade and international policies that are freezing out not just China but also longtime economic and military allies, while welcoming a longstanding adversary, Russia. China dominates production of numerous critical metals and minerals, but none so completely as the rare earths. More than 95 percent of industrially useful rare-earth metals are produced by China, creating supply-chain and national-security vulnerabilities that the U.S. and other countries have been attempting to ameliorate for more than a decade.
Ukraine Doesn’t Actually Have Minable Rare Earths
To begin with, the contentious 28 February Oval Office meeting can’t be understood without a crucial piece of context: there are no deposits of rare-earth ore in Ukraine known to be minable in an economically viable way. And that would be true even if full-scale warfare were not raging in the country’s east, where a great deal of its mineral resources are concentrated.
Ukraine is believed to have four areas with substantial deposits of rare earth ores, according to Erik Jonsson, senior geologist with the Geological Survey of Sweden. “There are four slightly bigger deposits: Yastrubetske, Novopoltavske, Azovske, and Mazurivske. All but one of them seem to be now within or near the zone that the Russians control, as far as I can tell,” says Jonsson. “And when it comes to resources in those deposits, I mean, we have numbers; yes, that’s nice. But we have no real, detailed, outline of how those numbers were arrived at.” The numbers are believed to come from Soviet surveys dating as far back as the 1960s.
“The rare-earth deposits don’t look that relevant,” Jonsson concludes. “I mean, I wouldn’t go for them.” Two of the deposits are dominated by a mineral called britholite, he notes, which is not desirable because it has not been processed for rare earths, which means that almost nothing exists in the way of process chemistry and equipment.
“If you want critical minerals, Ukraine ain’t the place to look for them,” declares Jack Lifton, executive chairman of the Critical Minerals Institute. “It’s a fantasy. There’s no point to any of this. There’s some other agenda going on here. I can’t believe that anybody in Washington actually believes that it makes sense to get rare earths in Ukraine.”
Even without a war to contend with, it would take at least 15 years to build a mine to begin extracting rare-earth ore on a large scale, Lifton notes. And according to the terms of the draft critical materials deal, private companies would have to invest huge sums, likely a billion dollars or more, to develop rare-earths mines in Ukraine. It’s a possibility that Lifton, an IEEE member and former metals trader, dismisses as absurd. He notes that a multinational mining company, Rio Tinto Group, has spent close to US $3 billion on potential mine sites in Arizona and Alaska and still does not have the necessary licenses and permits from the U.S. Government to begin building a mine in either place.
What is Trump’s rare-earth agenda?....
....MUCH MORE
Over the years we visited Mr. Lifton many, many times. Here's a post that wraps some of those earlier visits. From August 2017 "Electric Vehicles: An Old Pro On Battery Technology and Policy and China":
June 21, 2010
Climateer Line of the Day: Rare Earth Edition
From Jack Lifton writing at Technology Metals Research:
Good times.Rare earths are nowhere near as important to the China State Council as they are to Western stock promoters, trying their P.T. Barnum Best to get us alarmed over a non-existent direct threat, from a battered industry in a country trying to raise its standard of living and meet stated national economic goals....-Chinese Production of Rare Earths: The Real CrisisOur last post linking to Mr. Lifton:
"Afghan Lithium And Other Mineral Nonsense"
Here's a 2015 post looking back to those halcyon days:
Rare earth metals: Objects of power and risk
Just the words, "Rare Earth" brings back memories: “My old MG TC. A blond girl, tan from the summer sun, in the Hamptons, beer on the beach, ‘Unchained Melody,’ the little bar in the Village.”
Uh, wait. That was Adam Smith in our 2012 post "Adam Smith on Oil Shale (Now with Voodoo Beach Bunnies)". Ahem. Never mind.
Our memories are more like trading Molycorp for three triples, short and long, on the blog, in public, from IPO to bankruptcy or if you will "From tombstone to tombstone".
Or commenting on the passing parade: Luxembourg-based Rare Earth Company Hoping to Mine in South Africa by 2014 Does Oversubscribed IPO in Toronto (FRO.tsx), or quoting one of the, if not the, best books on investing and life:
And many more.
