MP Materials to boost US rare earths production
by William Gleason, Editor
The Mountain Pass Mine in California is a resilient one rife with stories of mining’s past, present and future. What started as a uranium project in 1952 is back in production and could soon be poised to possibly become one of the most reliable sources for rare earth elements (REE) in the Western Hemisphere and certainly in the United States.
MP Materials, the current owners of the mine, announced in July a plan to combine with Fortress Value Acquisition Corp. to create a combined company with an estimated $1.5 billion post-transaction equity valuation.
“I think this transaction establishes MP Materials as the western champion in the full rare earth supply chain,” James Litinsky, the incoming chairman and chief executive officer of MP Materials told Mining Engineering. “Our mission is to restore the full rare earth supply chain to the United States of America. We believe there is no asset like ours in the world, certainly in the Western Hemisphere, so it gives us unique positioning.”
It has been well reported that the rare earth supply chain is currently dominated by China. The United States government has taken notice of the issue and of the work MP Materials has done on its Stage 2 project to build a heavy rare earths separation facility. On July 10, the U.S. Department of Defense issued a contract to MP Materials for the facility. MP Materials has stated that its goal is to have full processing operations in the United States by 2022 following the completion of the second stage of its recommissioning.
“We believe that we are creating a champion that the United States will need in order to handle a single point of failure in the rare earth supply chain,” said Litinsky.
If some of this sounds familiar it’s because it should. Between 2008 and 2013, the Mountain Pass Mine was the star of the United States mining industry. Under the ownership of Molycorp, the mine was brought back to life and a $1.7 billion investment helped reestablish the mine, giving Molycorp what it felt would be solid footing to compete with the Chinese in the REE sector. In 2010, Chinese companies restricted rare earth exports to Japan over a diplomatic dispute, leading prices and Molycorp’s stock price to spike as many investors wanted a piece of the action. However, it would be a short-lived success story and by 2013 the company’s revenues were in free fall and in 2017 Molycorp was bankrupt.
MP Materials will try to succeed where Molycorp failed.
Litinsky noted that while Molycorp built a state-of-the-art facility and had a good vision that all of the technologies (electric vehicles, drones and wind turbines) would grow, the company had a challenge in the way it processed materials.
To correct the errors of the past, MP Materials said in a statement that it “plans to eliminate the cracking process and focus on a single-stage leach, providing flexibility to reduce the production of cerium, maximize NdPr production and reduce its costs dramatically.”
The green technologies of the future as well as lower carbon future will depend on a stable supply of rare earths and having a single supply chain is a significant issue.
“Currently, the world is 2-3 percent penetrated in electric vehicles and that is going to grow to 90 percent in the coming decades,” said Litinsky. “When you think about that, we have never before seen something become so critical in the supply chain (as rare earths). As this multi-trillion-dollar supply chain moves ahead we can’t have a single point of failure.”
The rare earths business is a tricky one with a changing and challenging landscape. MP Materials and Lynas Corp. are the only two rare earth mines operating outside of China, but if things go according to plan, the United States could soon be more REE-independent.