The Elements of Innovation Discovered
The Elements of Innovation Discovered
Metal Tech News - August 4, 2023
The average passenger electric vehicle motor uses between four and 12 pounds of rare earth magnets, which is driving enormous demand for the magnets USA Rare Earth will produce at its new plant in Stillwater, Oklahoma.
Australian Strategic Materials' Korean Metals Plant is initially focused on producing neodymium and neodymium-iron-boron alloys for rare earth magnets.
With its sights set on producing rare earth magnets at its new Oklahoma plant next year, USA Rare Earth LLC has entered into a multi-year supply agreement with Australian Strategic Materials Ltd., a producer of metals for clean energy and high-tech devices.
"Having a supply agreement in place with ASM plays a critical role in delivering on our vision of achieving magnet production in 2024," said USA Rare Earth CEO Tom Schneberger.
From the speakers and hard drive disks to MRI machines and cordless power tools, rare earth magnets are an integral part of the devices that make modern life modern. The primary demand drivers for these powerful permanent magnets, however, are electric vehicle motors and wind turbine generators.
While potential rare earth supply shortages have automakers like Tesla looking at alternatives for their EV motors, there are currently no substitutes that convert electricity to motion more efficiently than rare earth magnets.
Last year, USA Rare Earth acquired a 309,0000-square-foot building in Stillwater, Oklahoma, to house a plant to manufacture powerful rare earth magnets.
The Oklahoma rare earth magnet plant is one of the links in a complete rare earths mine-to-magnets supply chain being established by USA Rare Earth.
The first link of this chain is the Round Top rare earths and critical minerals mine project in the neighboring state of Texas.
Being advanced toward production under a joint venture between USA Rare Earth (80%) and Texas Mineral Resources Corp. (20%), the Round Top project southeast of El Paso hosts an enormous deposit of rare earths, lithium, and six other minerals critical to the U.S.
The Oklahoma plant, however, will be ready to produce the rare earth magnets needed today by the automotive sector before a mine and rare earths processing plant will be developed at Round Top.
This is where the deal with Australian Strategic Materials comes in.
"ASM provides us with predictable access to a non-Chinese supply of rare earth metals, which allows us to ramp-up our initial production and accelerate our goal of generating revenue, while we continue to construct our own mine," said Schneberger.
Much like USA Rare Earth, Australian Strategic Materials is establishing itself as a vertically integrated producer of rare earths and associated critical minerals.
The Australian company's Dubbo project, about 250 miles (400 kilometers) northwest of Sydney, hosts enough reserves to be a globally significant source of rare earths, zirconium, niobium, and hafnium for at least 20 years.
ASM is working toward developing a net-zero carbon emissions mining operation at Dubbo that would be one of only a handful of options outside of China for the critical metals found there.
The rare earths to be made into magnets in Oklahoma, however, will not be shipped from Dubbo. Instead, they will be delivered from ASM's Korean Metals Plant, which opened last year.
Situated about 70 miles (115 kilometers) south of Seoul, South Korea, this plant is currently focused on providing a reliable non-Chinese supply of the neodymium and neodymium-iron-boron alloys that are the primary ingredients in rare earth magnets.
While the longer-term plan for the Korean Metals Plant is to process material shipped from Dubbo, until the mine gets up and running ASM is sourcing rare earth oxides from a company in Vietnam, a country with the largest rare earth reserves outside of China.
"We are very impressed with the metal making capability that ASM established in Korea and look forward to a long-term partnership as we diversify the rare earth magnet supply chain," said USA Rare Earth's Schneberger.
For USA Rare Earth, the ASM supply provides a stopgap until it can get its own mine and processing facility in Texas off the ground.
A 2019 preliminary economic assessment for Round Top outlines plans for a mine that would produce 2,212 metric tons of rare earths per year, plus seven other critical metals – beryllium, gallium, hafnium, lithium, magnesium, manganese, and zirconium.
The suite of rare earths produced at Round Top will include six of these elements used in the powerful magnets that go into everything from children's toys to military hardware.
The mining operation outlined in the PEA would produce more than 200 metric tons of dysprosium, 180 tons of neodymium, 67 tons of praseodymium, 65 tons of gadolinium, 65 tons of samarium, and 23 tons of terbium per year.
Making it even more attractive in a world transitioning to EVs charged with low-carbon electricity, this Texas operation would produce about 10,000 metric tons of lithium per year and hosts 36,500 metric tons of gallium used in thin-film solar panels, LEDS, computer chips, and medical devices.
USA Rare Earth raised US$50 million in 2021 to complete a prefeasibility study that will further refine the economic and design parameters outlined in the PEA; finish testing at the company's pilot rare earths separation plant in Colorado; and build a demonstration-scale plant at Round Top.
The demonstration plant is expected to support a definitive feasibility study and permitting, as well as produce representative materials for evaluation by prospective customers.
Developing a mine in the U.S., however, is a much slower endeavor than building a magnet plant, especially for USA Rare Earth, which has a fortuitous head start.
This advantage came with the 2020 purchase of neodymium-iron-boron permanent magnet manufacturing equipment that Hitachi Metals America briefly used at a facility in North Carolina about a decade ago. At the time of the purchase, this was the only sintered rare earths magnets manufacturing equipment in the western hemisphere.
This equipment being installed at the company's plant in Oklahoma will utilize the rare earths supplied by ASM to make the magnets for the motors of the skyrocketing number of EVs hitting North American highways.
"USA Rare Earth's magnet manufacturing capability and approach to market makes them a perfect customer and partner for ASM," said Australian Strategic Materials Managing Director Rowena Smith.
The agreement supports both companies' commitments to scaling up their critical mineral businesses without any reliance on China.
"As we continue to increase our metal production output from our Korean Metals Plant, this long-term supply agreement demonstrates the growing demand and positive trajectory of the US rare earth magnet market," Smit added.
With more than 16 years of covering mining, Shane is renowned for his insights and and in-depth analysis of mining, mineral exploration and technology metals.
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