US Gov’t offers $20 million to projects aimed at recovering rare earths from coal
The US Department of Energy (DOE) has set aside about $20 million to fund projects aimed to quickly develop bench scale and pilot scale plans for recovering Rare Earth Elements (REE) from coal and coal by-products.
Last year, the National Energy Technology Laboratory (NETL) begun investigating the economic feasibility of recovering the coveted elements — used as ingredients in magnets, batteries, catalytic converters and high-tech products—from coal.
And while it has already characterized a number of REE-bearing samples, the new initiative seeks to speed up related research.
The move comes on the heels of a major shake-up in the US rare earths market, following Molycorp’s (NYSE:MCP) decision to file for bankruptcy protection last week.
The U.S. only miner and producer of rare earths Chapter 11 filing marked a sharp reversal of fortunes for a company that rode a boom in rare earths, amid a wider surge in commodities prices. Fuelled by restrictions on exports of rare earths by China, the world’s dominant supplier, Molycorp’s market value rocketed to over $6 billion five years ago.
Shortly after, however, China loosened its rules, and battery and magnet makers found alternatives to rare earths, sending Molycorp finances down the slippery slope. The company, in fact, hasn’t turned a profit since 2011.
The prices for these elements, considered a strategic resource because they are used in military electronics, have been particularly hard-hit in the commodities rout. Prices for most rare earths have fallen over tenfold since their 2010 peaks, and the total market is now around $1 billion, down from over $17 billion.
The grant could eventually help the U.S. ailing coal industry. Local producers are battling not just government regulators but cheaper natural gas, which in April surpassed it for the first time as the primary source of electricity generation in the U.S.