The Special Science of Rare Earths: Interview with Tony Mariano
The Gold Report: Jon Hykawy, technology analyst at Byron Capital Markets, recently told us that short supplies of heavy rare earths (HREEs) will be driving up their price and shifting the economies of mining projects in favour of companies that can produce large quantities of heavy rare earths. To what extent do you agree with that assessment?
Tony Mariano: I believe that this may be true; however, we must define our demarcation of the light rare earth elements (LREEs) and heavy rare earth elements. Individuals have their own ideas of where to start defining the heavies as opposed to the lights.
Currently the lanthanides in greatest demand are neodymium, europium, gadolinium, dysprosium and terbium; however, the demand for particular REEs is dynamic and can change at any time. Praseodymium is also of value because it has similar properties to neodymium.
When companies promote their deposits, they tend to come up with something along the lines of, “We have a certain percentage of the heavies and a certain percentage of the lights.” The greater the percentage of the heavies they show, the more it is to their advantage, so they tend to start counting in areas that I would qualify as light rare earth elements.
When REEs are being discussed, people should define what they mean by “light” and “heavy” rare earths. In my opinion, the lights go midway through gadolinium. I would classify the heavies as terbium through lutetium. If you attempt to synthesize each of the REEs with a certain complex, phosphorus pentoxide (P2O5), for example, lanthanum through gadolinium will assume a monoclinic structure. Terbium through lutetium will assume a tetragonal structure similar to yttrium phosphate, and also similar to the mineral zircon. In my opinion, this demarcation is more rigorous from a scientific point of view. Otherwise the distinction between the LREEs and HREEs is arbitrary.
TGR: So the generally accepted notion that the HREEs are less common and therefore rarer and more valuable isn’t accurate?
TM: No, that’s not accurate. They’re heavies or they’re lights, period. Some are common. Some are not. Some of the heavies tend to be much rarer. Lutetium is a rare element, but yttrium — which always accompanies the heavy lanthanides — is not a rare element. In many areas, dysprosium, erbium and terbium are not that rare.
TGR: When investors hear the terms “light rare earths” and “heavy rare earths,” how should they be thinking in terms of the economic viability of a deposit?
TM: I would imagine they have to pay attention to those that are currently in demand and place that into the equation. When they hear that a deposit has a certain amount of tonnage of certain elements, nowadays people tend to sit down and look at those elements’ market prices. Then they decide that they’ve got something great. To me this approach can be very misleading.
TM: You can find many deposits that show good grade and tonnage consisting of a large quantity of valuable elements. If one calculates the elements’ value based on current prices, the deposit looks as if it’s of great value. However, those elements must be mineable and economic to process so that they are competitive in the marketplace. In many occurrences that might not be the case.
TGR: The Chinese have become very good at finding rare earth deposits and processing them, and are dominant in this space. Recently they announced that they will begin restricting rare earth exports, which seems to have created a rush to find deposits throughout North America. In general, where do you think the prospects look good?
TM: We know of a number of deposits in North America where we can acquire the light lanthanides. We can do well going from lanthanum into the mid-atomic number lanthanides. That would include deposits such as Molycorp Minerals' (NYSE: MCP) Mountain Pass in California, Rare Element Resources Ltd's (TSX.V;RES) Bear Lodge carbonatite in Wyoming, and Wicheeda Lake in British Columbia, which is run by a private company, Spectrum Mining Corporation.
The Mountain Pass deposit is rich in LREEs, with ample grade and tonnage, and Molycorp has the technology to produce excellent REE concentrates for lanthanum, cerium, praseodymium, neodymium and samarium. And based on work that I have done in Wicheeda Lake, that mineralogy is amenable to physical concentration and there should be no problems in chemical processing.
Althought we have sources in North America for LREEs in addition to those I have just mentioned, to me they may have the best potential.
In terms of the heavies, we have several interesting HREE occurrences with some potential that are currently being investigated.
TRG: What are some of the deposits with the high ratio of heavies to lights that you're interested in?
TM: I've been working for UCORE Rare Metals Inc. (TSX.V:UCU) on Bokan Mountain in Alaska. It's on the southern tip of Prince of Wales Island. The accessibility there is the best of almost any deposit. It's principally heavy rare earth enriched with yttrium. The heavy lanthanides dominate the mineralogy. At this time they are working to establish whether they have sufficient grade and tonnage, and whether it's amenable to economic recovery.
They're in the exploration process right now. The U.S.government is quite interested in these minerals because they are of military importance.
TGR: Let's move on to some of the other deposits you'd like to talk about.
TM: I started the mineral exploration in Kipawa, Quebec, for Molycorp in the mid-1980's. Kipawa is enriched with the mineral eudialyte, which means "well decomposable" in Greek. I was able to establish that eudialyte contained yttrium and HREEs in anomalous amounts.
A number of years ago Matamec Explorations Inc. (TSX.V:MAT), a Canadian company from Quebec, accquired the mineral rights on Kipawa. I've been basically working with Matamec and they are beginning to get some very interesting results.
TGR: What are you finding?
TM: First of all, it’s going to be very easy to make a eudialyte physical concentrate in Kipawa. In fact, the way I see it, it’s going to be easier to do this in Kipawa than in any other eudialyte deposit that I’ve worked on thus far. They are working on establishing that they indeed can process the eudialyte concentrate chemically to remove all of the lanthanides and yttrium and be able to bring them into the market. And do it at a cost that’s competitive.
TGR: So the ease of creating that eudialyte concentrate translates into a lower cost of production?
TM: Yes. But there are a lot of other additional costs. It’s common sense that, if a deposit is in a certain type of geologic occurrence where the rocks are very difficult to crush and separate, it’s going to be much more costly. And if a deposit is in a remote place it’s going to cost a lot more to mine and you need to get power, too. You need to get reagents. You need qualified people to do the mining. Also, speaking of other complications, the Parajito is currently owned by First Nations groups who have not allowed requests for access to the land and have yet to partner with a public company, so investment there is impossible at this time.
TGR: You mentioned Rare Element Resources’ Bear Lodge a bit earlier. What’s the story there?
TM: Bear Lodge is a light lanthanide deposit. I did the initial work on Bear Lodge in the ‘70s—again for Molycorp. I did all of the mineralogy. I just came back from there in mid- uly. Bear Lodge can provide light lanthanides and some of the mid-atomic number lanthanides in greater quantity than Mountain Pass, so that deposit has very good potential.
TGR: Right. Now let me ask you about one more project and that is Strange Lake. You’ve obviously visited Strange Lake.
TM: I did a considerable amount of work in the early 1980s on Strange Lake. It’s a large A-type granite circular structure, close to 5 kilometres in diameter. I believe it was first discovered by Iron Ore Company of Canada (IOC). Now Quest Rare Minerals Ltd. (TSX.V:QRM) is exploring and defining Strange Lake.
This deposit is made up of a complexity of a number of different rare earthbearing minerals that are very fine grain and are locked mostly in quartz and feldspar. So there are problems in processing, to say nothing of the remoteness of the deposit and some other issues that go beyond what I specialize in — such as cost of transportation and social and political issues. However, recently they have made considerable progress in their drilling program, uncovering some areas of very attractive mineralization.
*Anthony N. (Tony) Mariano, PhD, is a geological consultant on rare earths and other rare metals. Mariano worked at Kennecott Research’s lab in Massachusetts, after which he began his career as a consulting geologist, specializing in carbonatite-hosted rare earth and niobium deposits. Streetwise Reports — “Expert Investment Information for the Thoughtful Investor” — are a portfolio of industry-specific websites (The Gold Report and The Energy Report) and enewsletters that feature top Wall Street analysts, leading portfolio managers and recognized newsletter writers giving their outlook on specific investment sectors and recommendations for companies in those sectors.