US Rare Earths drills for American independence
Kevin Cassidy isn't just digging up rare earths, he's unearthing a "national treasure."
As the CEO of US Rare Earths – an exploration company with properties in Montana, Idaho and Colorado – Cassidy says his company could be a "game changer" for the US in terms of jobs, American independence and weapons manufacturing.
US Rare Earths announced this week that it was extending its 2013 drilling program, with eight more holes expected before the winter.
Building on historic data for more than 25,000 acres of land, Cassidy says the company is confirming high concentrations of rare earth elements (REE) which will help the US wean itself off of Chinese REE imports. Properties include areas of land that have been examined by the US Geological Survey since the 1950s and by private companies in the 1980s, though little work has been done since.
"We're drilling to prove, not just because we think it's there," Cassidy said.
Earlier this month the company secured a $4 million financing arrangement to expand its operations. Cassidy believes they could have initial production by next summer.
Using old tunnels already in place, the company plans on crushing the rock on-site and taking the mineral concentrate off-site for separation.
Producing more than 95% of the world's REE, China has near-complete control over prices and supply – a fact which has made the US very uneasy as it depends on these materials for a variety of products, most importantly weapons. Cassidy believes the US Department of Defence (DOD) would be one of the company's biggest customers. "We intend to create a complete supply chain solution in the US," the CEO explained. "I want to be able to provide the US government with US created and refined rare earths."
According to a paper published in September by the Federation of American Scientists, a nonpartisan research group, the DOD currently uses less than 5% of domestically-produced rare earths. The same study states that the DOD has not publicly classified REE as "strategic or critical" materials.
But in an interview with Bloomberg last year, a DOD official told reporters that the Pentagon was "continuously monitoring" the market for rare earth materials, keeping an eye out for supply shortages which would trigger REE stockpiling by the US.
Recently at the World Trade Organization, Japan and several other countries successfully challenged China's restrictions on rare earth exports. But aside from taking the issue to court, no country has been able to upset the Asian giant's dominance in the market – the main issue being an expensive and complex production process.
Cassidy doesn't see this is a problem. If China can do it, he says, so can America.
"You really believe no one in American can separate REE? Eighty percent of it is literally crushing rock."