Rare Earths Reality: Hype vs Hope with 3 Experts

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Everybody screams are heavy.
Rehearse in USA and terrible.

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Well, last year China exported
to the US 60kg of dysprosium,

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10kg of turbulent.
It's not really a very

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irrelevant market.
Energy.

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It's tacky.
I don't know if you've been

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following what's going on.
In the rare earth market, maybe

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you've been paying attention.
Rare earths have become the

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hottest topic in global news,
right China.

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US embargoes?
Export crunch downs.

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It's called mainstream, like the
the conversation around rare

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earths, which is kind of crazy
because we're in the world of

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like mining news and I don't
feel like I know enough about

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this yet somehow the mainstream
has like an opinion on rare

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earth, on rare earth projects,
like share prices of weird

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projects are going crazy.
It's a, it's a, it's a truly

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bizarre time.
Weird projects to say the least.

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Yeah.
So I just really wanted to kind

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of get to the bottom of what's
going on, what it means, what's

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relevant to markets by summoning
three of the best thinkers I

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know that are obsessed and
addicted to the rare earth

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industry.
A truly All Star crowd like rare

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earth observer, DK sustainable
dude, this is, you know, All

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Star type material to actually
just teach us and help us and

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the money miners learn about
what is going on, right?

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Absolute All Star crowd I'm.
I'm pretty excited to share this

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conversation.
This panel of absolute rare

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Earth Experts JD is brought to
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Go MMS.
Utterly delighted to be joined

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by three of the preeminent
experts in the rare earth

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industry.
This expert panel is led by none

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other than the rare Earth
observer, Thomas Crummer.

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Everyone would be very familiar
with your blog, which is

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prolific for anyone who wants to
get up the curve in rare earth.

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An up and coming person who's
been writing very thoughtfully

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is Sustainable Dude, which is
the frog you see on camera right

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now.
Hilarious.

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Well done.
I'm loving that Sustainable

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Dude.
And to round out the panel,

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we've got Dylan Kelly or DK of
Terror Capital, who has come on

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before and has that investor
lens in the buy side, kind of

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equities in the names and has
shared with us generously in the

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past his rules for investing in
the very complex rare earths

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space.
Because by the way, a lot of the

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time, gentlemen, thank you so
much for making the time to talk

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about rare earths.
What a topical commodity to be

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talking about right now.
I've never seen rare earths so

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hot, although I'm sure they have
been in the past.

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It's not entirely rare, after
all, for it to be topical.

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No, it's true.
I think I also made a tweet

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about this before.
Interesting red flag.

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Consider it a red flag, and now
it's market foresight, so times

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can change.
Absolutely.

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What is going on?
I'm struggling to make sense of

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what's real, what's not, what's
policy, what's conjecture, what

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is moving markets like if we
were just to kind of step back

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and assume that I know nothing
about what's happening

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geopolitically right now, which
is true.

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What the hell is going on?
I want to go straight to the gut

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on all things in the subject
matter.

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Thomas.
What's, what's the story mate?

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What's is the geopolitical
problem?

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Reality.
Or is it really just a fuss

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about nothing?
Well, when, when China started

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messing around with with gallium
and germanium, I, I'm used that

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if, if they would blanket
Bandra's exports this that they

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would shoot themselves with an
elephant rifle into both feet.

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So, and actually they didn't
several years ago, I think

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somebody in the Chinese Foreign
ministry said that China does

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not want to aid the production
of weapons that can threaten

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China.
And what they did I think over

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many years was to work out which
are the most relevant materials.

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And I think this seven element
ban or say dual use

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classification may have come.
Anyway, it is not really related

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to the trade war, and that is
why the Americans have also so

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much trouble to make the Chinese
take a step back from that,

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because from the Chinese side it
may not be really related.

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It would have come anyway.
My view for all of the seven

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elements, for each of them,
there is at least one Pentagon

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contractor who is a major user
of this product, of the relevant

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product.
That is probably why these seven

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were chosen.
The seven also referred to the

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six strategic weaknesses that
the Chinese military has

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published.
I think it's less trade war

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related.
Also now the result from the

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talks in London shows that the
Chinese side has absolutely no

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intention to reverse this in any
way.

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I'm quite interested like dual
use makes total sense to me.

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What I've found really
interesting is that like the six

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records we've seen so scanning
I'm leaving aside right now

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because it's like be covered in
very different process than the

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other ones.
Generally, what happened

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interesting is it also coincides
with very, I would say

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vulnerable feedstock supply
chain.

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I'm wondering what your thoughts
are and does it play a role in

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this what we've seen today?
I think Dylan can sing a song

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about this.
This in general a problem of

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everyone who wants to enter rare
earth that rare as production,

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rare separation, rare as metal
making and so on that the cost

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are and the CapEx are probably
three times as high as sale in

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China.
By extension, it would like last

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year in Tokyo, we had the Rare
Earth Industry Association

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conference and I was hosting a
panel of junior minor rare earth

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hopefuls and I just tossed the
question also what level must

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rare earth prices be so that you
become feasible And it was

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Unizomo, the same prices must go
up three times.

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That is a real problem.
It's also related to the know

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how say if you look at recovery
rates of of junior as miners and

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in the West they are below
anything that would be

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licensable even in China, they
really squeeze the lemon dry,

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whereas we recover anywhere
between 40 and 80%, you know, so

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that that already is a cost
factor the the know how.

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Interesting.
Would you say like putting such

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a system in place like we've
seen with this expert licensing

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system is also maybe to say
Myanmar really gets messy.

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Like it's already messy, but
there's still material flowing,

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albeit very varying per month.
Once it's if the dries up, is

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this something to to like?
Are you trying to like hatching

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them themselves here?
Is that a possible scenario?

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You see that that one very
common misunderstanding is that

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rare earth products should be
commodities.

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It is.
China has made great strides to

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commoditize them to make sure
that products are

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interchangeable and therefore
there is more competition among

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manufacturers.
And of course, you can trade

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them on exchange.
In the West, we have no

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industrial standards for rarest
products.

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I understand the international
standards organization ISO has

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been on internationalizing
Chinese industrial rarest

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standards for 10 years.
And I'm not sure if that is the

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preference of the ISO, but
they've come up with

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sustainability standards,
recycling standards, packaging

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standards, you know, all the
fringe stuff, but nothing of

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substance.
I asked one member of the group

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at ISO who is at it, and he
claimed that the United States,

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part of the ISO is not so really
interesting having standards for

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rare earth products.
So these are not commodities.

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Every user has his own purchase
specification, you know, and

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they're, they're all test
processes and so on.

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Nothing is standardized.
So you can't in the West, these

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are specialty chemicals.
And also you have to must really

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look at what are we actually
buying in China.

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About 60 to 70% of the imports
of the US, of Japan, of the EU

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are the rare earth elements,
Lansano and cereal.

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What do we use them for?
Well, we use them for the

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production of fossil fuels and
the consumption day off.

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Yeah.
So we are talking about fluid

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cracking catalysts for producing
gasoline, diesel, whatever you

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want, you know, and we're
talking about the catalytic

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converter in internal combustion
engine and hybrid cars that is

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our main dependency in rare
earths products, no.

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One talks about that.
Magnet dependency, that is

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written on a different piece of
paper.

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In terms of rare earths, yeah,
everybody screams, ah, heavy

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earths in USA and terrible.
Well, last year China exported

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to the US 60kg of dysprosium,
10kg of terbium metal.

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Yeah, as metal, not as oxide. 10
tons of Lanzano metal, 12 kilos

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of scandium and the 236 kilos of
of metal alloys.

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These are the metrics.
If you go into the compounds,

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that's a slightly different
picture.

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Yeah.
But you know, it's not really a

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very relevant market.
No, that's, that's definitely a

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very good point.
I think we just said the main

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concern with the USA government
would be more in the high

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performance magnets now that we
see humanoids percent

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potentially being deployed if
these these kind of things.

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Yeah.
See the the primary dependence

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of the West is on the products
that are made from the earth,

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including rare earth permanent
magnets.

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We have no value chain behind
it.

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That's why it's so funny.
You know, if there's someone who

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says we are going to produce
4000 tons of NDPR per year, you

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know, in Europe, right?
So who do you sell it to?

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There's no, but you need a metal
maker who makes metal out of

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this, and then you need the
magnet maker who takes the

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metal.
But there's another little

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detail that everyone always
forgets.

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You know, you leave the two
elements, neodenium and

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prosodenium in the proportion
that you found them in your

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deposit.
You don't separate them.

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But these proportions are
different from deposit to

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deposit.
Like Linus says, 78 to 22.

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I don't know right now off hand
what is MP materials.

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You know the standard prescribe
75 to 2585 to 1570 to 30.

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You will not go lower than 70 to
30 because then prozodinium will

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kind of affect the coercivity of
the magnet.

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00:12:01,040 --> 00:12:04,800
These are not commodities.
You get chemical compositions

200
00:12:04,800 --> 00:12:09,200
prescribed by your customer and
that says you have a 78 to 22

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product and the customer wants
75 to 25.

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00:12:12,680 --> 00:12:16,200
What do you do?
Nobody is separating ND and PR.

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00:12:16,360 --> 00:12:20,520
So where should the balance come
from to make a metal that is

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according to the specification
of the customer?

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Yeah, really.
People don't go into the

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details.
So that that kind of throws into

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00:12:28,840 --> 00:12:34,120
doubt the entire ability to have
supply chain independence, you

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00:12:34,120 --> 00:12:36,280
know what I mean?
The specifications matter.

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00:12:36,520 --> 00:12:39,360
It's almost implausible to build
out an entirely independent

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supply chain that can make
unique customer demands

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independent of China.
Well, it sounds to me like to

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that point, policymakers are
pushing far too hard thinking

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that they can build a supply
chain out without realizing the

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full complexity of how many
steps there are between pit top

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00:13:00,040 --> 00:13:03,880
and finished product.
The second part being how much

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noise is thrown at the wrong end
of that argument and continually

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00:13:08,800 --> 00:13:12,920
sort of pushed ahead without
really thinking through the

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00:13:12,920 --> 00:13:15,800
complexity, the cost and the
economics of this.

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00:13:16,280 --> 00:13:19,520
It's farcical to think that
we're ever going to chase, you

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00:13:19,520 --> 00:13:24,040
know, supply chains that are
this discombobulated with some

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sort of economic return of any
stretch, even if we were to

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00:13:27,640 --> 00:13:29,520
increase prices, you know, 3 to
4 fold.

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00:13:31,000 --> 00:13:35,240
So in my mind, I think there's
so many mainstream narratives

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that have spun on the space that
just don't hold up to reality.

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00:13:39,320 --> 00:13:41,560
I think, Thomas, you're making
some good points just cutting

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them off.
But what do you make, Thomas?

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00:13:44,560 --> 00:13:48,160
Is the world going mad over
something that's largely

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relevant?
There are several points to

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00:13:51,240 --> 00:13:54,320
observe.
First of all, I think it is

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00:13:54,320 --> 00:13:59,120
important to understand that the
high performance and the Feb

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00:13:59,200 --> 00:14:02,960
magnets, so these are the ones
that still perform at high

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00:14:02,960 --> 00:14:08,200
working temperature say 180°.
You know, they are arguably

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00:14:09,080 --> 00:14:13,080
maybe on behalf of the market.
You have to visualize that China

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00:14:13,080 --> 00:14:18,920
last year exported 58,147 tons
of Rarer's permanent magnets to

235
00:14:18,920 --> 00:14:24,080
130 countries.
These are often commodity

236
00:14:24,080 --> 00:14:29,400
magnets that can stand a working
temperature of maybe 80°C.

237
00:14:30,160 --> 00:14:34,360
But which of our rarest hopefuls
wants to go for these magnets?

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00:14:34,360 --> 00:14:36,960
Nobody.
All of them claim for themselves

239
00:14:36,960 --> 00:14:41,600
that they can manage the high
tech composition of permanent

240
00:14:41,600 --> 00:14:46,920
magnets that are reaching a
working temperature of 180°C or

241
00:14:46,920 --> 00:14:51,040
even 230°C.
So they're trying the impossible

242
00:14:51,360 --> 00:14:55,760
rather than to go from the
simple and 1st because you know

243
00:14:55,800 --> 00:15:00,360
since 2009 there has been no
NDFEB production in the United

244
00:15:00,360 --> 00:15:03,760
States.
You know in Germany vacuum have

245
00:15:03,800 --> 00:15:08,480
the minority joint venture with
Jungka Sankwan in Beijing where

246
00:15:08,480 --> 00:15:12,400
they get the blanks and ship
them off to their subsidiaries

247
00:15:12,400 --> 00:15:15,240
for the final processing.
We should have actually gone

248
00:15:15,240 --> 00:15:19,080
from the simple stuff that we
may be able to do.

249
00:15:19,960 --> 00:15:25,320
Then, of course, after 2014,
when China lost the WTO case of

250
00:15:25,440 --> 00:15:29,760
the EU, Japan and the US, all
efforts in the US rested.

251
00:15:30,080 --> 00:15:34,640
Everything just fell apart in
the EU, they continued.

252
00:15:34,680 --> 00:15:38,680
But it was more to prove
activity rather than to come up

253
00:15:38,680 --> 00:15:41,960
with something tangible.
So it was very important to

254
00:15:41,960 --> 00:15:47,240
support projects that are
sustainable and environmentally

255
00:15:47,240 --> 00:15:49,920
benign.
It was not on getting something

256
00:15:49,920 --> 00:15:53,320
done.
We approached from the two

257
00:15:53,320 --> 00:15:57,680
different ends and had nothing
in the middle say it doesn't

258
00:15:57,680 --> 00:16:01,720
help us if we mine a rare earth
also concentrates if we do not

259
00:16:01,720 --> 00:16:06,840
have the industry that uses this
and separates the rare earth

260
00:16:07,280 --> 00:16:10,960
produces the more than 50
different compounds of rare

261
00:16:10,960 --> 00:16:16,240
earths that China exports to us.
And then a further downstream

262
00:16:16,240 --> 00:16:20,520
industry which takes part of
this, makes metals to supply

263
00:16:20,520 --> 00:16:24,280
those users who require metals.
Yeah, I, I think that's very

264
00:16:24,280 --> 00:16:27,640
unique about the supply chain as
we see nowadays, especially when

265
00:16:27,640 --> 00:16:29,440
we're trying to build in the
West is we're trying to build

266
00:16:29,440 --> 00:16:31,160
this from upstream to
downstream.

267
00:16:31,480 --> 00:16:33,600
Normally you would do the other
way around from downstream to

268
00:16:33,600 --> 00:16:35,240
upstream.
And like Thomas mentioned,

269
00:16:35,240 --> 00:16:36,840
these, these aren't really
commodities in the general

270
00:16:36,840 --> 00:16:38,440
sense.
So there's, there is so much

271
00:16:38,440 --> 00:16:41,640
variety between the, the mineral
concentration treats the

272
00:16:41,640 --> 00:16:44,640
carbonate, if it's oxide, the
many, many things.

273
00:16:45,320 --> 00:16:47,680
And now we're seeing a host of
junior mining projects which are

274
00:16:47,680 --> 00:16:50,160
trying to mark their products.
They're finding middle Western

275
00:16:50,160 --> 00:16:52,000
buyers.
It's all going into China

276
00:16:52,000 --> 00:16:55,080
because China has many companies
which can take these these very

277
00:16:55,080 --> 00:16:58,160
various products.
So I think one of the most

278
00:16:58,160 --> 00:17:01,040
important things to do, it is
like Thomas said, build your

279
00:17:01,040 --> 00:17:03,920
magnet capacity in the West,
then go search for feedstock

280
00:17:04,119 --> 00:17:07,280
subsequently.
I would say like 5-6 years ago,

281
00:17:08,160 --> 00:17:13,440
we should have simply started
doing NDFEB magnets and we would

282
00:17:13,440 --> 00:17:17,839
have sourced the metals in China
and we would have dared them not

283
00:17:17,839 --> 00:17:21,560
to supply them.
And at that time, China had

284
00:17:21,560 --> 00:17:23,640
absolutely no appetite for
confrontation.

285
00:17:24,800 --> 00:17:26,920
So we may have actually
succeeded.

286
00:17:27,240 --> 00:17:30,200
Of course, what is always
getting buried a little bit is

287
00:17:30,200 --> 00:17:33,800
the role that our Japanese
friends played in this whole

288
00:17:33,800 --> 00:17:37,000
mess.
First of all, Japan is regularly

289
00:17:37,000 --> 00:17:42,320
40 to 50% of China's total
rarest compounds and metal

290
00:17:42,320 --> 00:17:45,560
exports of the export value, not
of the volume.

291
00:17:45,560 --> 00:17:50,200
The volume is smaller, and they
were sitting on the core

292
00:17:50,200 --> 00:17:56,040
patterns for the NDFEB magnets.
And Hitachi Metals had the

293
00:17:56,160 --> 00:18:01,440
arrogance to believe that they
can influence the supply and

294
00:18:01,440 --> 00:18:06,960
demand of NDFEB magnets if they
control the licensing of the

295
00:18:06,960 --> 00:18:10,960
process, that they don't give a
license to anyone who wants one.

296
00:18:11,440 --> 00:18:15,240
But look at the whole market
picture and see, oh, would this

297
00:18:15,240 --> 00:18:19,040
throw the market off balance?
You know, and that is why the

298
00:18:19,040 --> 00:18:22,280
Chinese suit Hitachi Metals,
they said that they're abusing

299
00:18:22,280 --> 00:18:26,080
their market power because
Hitachi Metals, if somebody was

300
00:18:26,280 --> 00:18:30,720
using Hitachi's process and
starting to produce NDF EB in

301
00:18:30,720 --> 00:18:35,760
China, Hitachi would sue them.
But had this manufacturer asked

302
00:18:35,760 --> 00:18:39,200
for a license, he wouldn't have
gotten it from Hitachi Metals.

303
00:18:40,480 --> 00:18:45,200
Had Hitachi Metals not had this
policy, we would have probably a

304
00:18:45,200 --> 00:18:48,560
much larger distribution of
NDFEB magnets, left, right,

305
00:18:48,560 --> 00:18:51,360
center.
And do you see any joint

306
00:18:51,360 --> 00:18:56,920
initiatives between the Japanese
and the US in Europe?

307
00:18:56,920 --> 00:19:01,440
Now you have this project that
involves Solvay less common

308
00:19:01,440 --> 00:19:05,840
metals and cherister and they
based on the assumption that

309
00:19:05,840 --> 00:19:10,240
they can get the Namibia Nabibia
Critical Metals project

310
00:19:10,360 --> 00:19:15,360
lifestyle going which is best
see no time with a very

311
00:19:15,360 --> 00:19:17,680
favourable proportional
composition.

312
00:19:18,800 --> 00:19:23,920
But you know, this project is
moving at snail's speed and I do

313
00:19:23,960 --> 00:19:28,840
not think it will get going
before 2030, maybe not even

314
00:19:28,840 --> 00:19:32,400
beyond.
Yeah, feed soot is definitely a

315
00:19:32,400 --> 00:19:34,760
problem with which you see in
many projects in the West.

316
00:19:35,200 --> 00:19:38,960
I do think we see a changing
Western perspective on how we

317
00:19:39,000 --> 00:19:41,440
source especially heavy red
concentrates.

318
00:19:41,760 --> 00:19:46,200
We saw the recent MU it's still
an MOMOU, but Linus entering an

319
00:19:46,200 --> 00:19:48,640
agreement with the Malaysian
state of I've got the state name

320
00:19:49,120 --> 00:19:52,040
but for ionic clay concentrate.
I think it might be a watershed

321
00:19:52,040 --> 00:19:55,480
points where Western companies
may follow suit here in Malaysia

322
00:19:55,960 --> 00:19:59,880
and Western companies are
opening themselves up for yeah

323
00:20:00,440 --> 00:20:03,280
what is effectively in situ
ionic clay leching, which is

324
00:20:03,440 --> 00:20:06,520
environmentally questionable.
I would say I think Thomas and

325
00:20:06,800 --> 00:20:09,280
didn't have some more
perspective on this, but I do

326
00:20:09,280 --> 00:20:12,480
know that that Malaysia is
really looking to expand their

327
00:20:12,480 --> 00:20:13,800
industry.
I think they want to target like

328
00:20:13,800 --> 00:20:18,960
3000 tons of trio by 20 thirty
10,000 tons of NDPR which is I

329
00:20:18,960 --> 00:20:21,960
think there might be western
companies that looking to tap

330
00:20:21,960 --> 00:20:23,960
into that I.
Think that's an interesting,

331
00:20:24,280 --> 00:20:26,080
interesting point.
Who would have thought that the

332
00:20:26,080 --> 00:20:28,480
Malaysians that actually want to
increase the amount of railroad

333
00:20:28,480 --> 00:20:30,400
production is coming out of the
country?

334
00:20:30,800 --> 00:20:32,480
Does it?
Your license still expires in a

335
00:20:32,480 --> 00:20:35,760
couple of years, Doesn't.
It no, don't continue to roll it

336
00:20:36,800 --> 00:20:39,120
just long as the WLP doesn't
come anywhere near the near

337
00:20:39,120 --> 00:20:41,800
them.
But I think, yeah, there's well,

338
00:20:41,800 --> 00:20:44,360
one, one point I wouldn't mind
touching on is this notion that

339
00:20:45,520 --> 00:20:49,280
we all think about clays as
being posted in the parts of

340
00:20:49,280 --> 00:20:51,440
southern China branching off
into Myanmar.

341
00:20:52,160 --> 00:20:56,360
But as we know, clays somewhat
abundant and there seems to be a

342
00:20:56,360 --> 00:20:59,320
whole series of discoveries
after discoveries scattered all

343
00:20:59,320 --> 00:21:00,960
over the place in high rainfall
areas.

344
00:21:01,720 --> 00:21:06,720
Minister Ice and the caldera
with Mei and VMM come to mind,

345
00:21:06,720 --> 00:21:11,120
but also what Sarah Berto's got.
We're talking about some of the

346
00:21:11,120 --> 00:21:13,840
clays that are occurring up and
down the Malaysian peninsula.

347
00:21:14,240 --> 00:21:18,640
I mean, in my mind, it seems
like we're discovering them

348
00:21:19,240 --> 00:21:22,480
relatively frequently.
But the ability to actually

349
00:21:22,480 --> 00:21:24,960
bring these things into
production is still another

350
00:21:24,960 --> 00:21:27,200
question.
Thomas, I wanted to get your

351
00:21:27,200 --> 00:21:30,200
thoughts on that.
In my mind, I was working the

352
00:21:30,200 --> 00:21:36,480
thesis that if Clay's work at
Sera Verde gets up and works and

353
00:21:36,480 --> 00:21:40,240
makes money, we probably don't
need to build another Hard Rock,

354
00:21:40,240 --> 00:21:42,200
rare earth, vertically
integrated mind.

355
00:21:43,520 --> 00:21:45,480
But it sounds like there's some
troubles there.

356
00:21:45,480 --> 00:21:46,760
There's still some questions
over.

357
00:21:48,040 --> 00:21:51,800
It first of all, I would like to
challenge the notion that we

358
00:21:51,800 --> 00:21:56,880
don't have enough feedstock.
China imported last year as

359
00:21:56,880 --> 00:22:03,640
direct feedstock to the rarest
industry, 177,000 tons.

360
00:22:04,200 --> 00:22:06,760
What is the lack of feedstock
here?

361
00:22:07,280 --> 00:22:11,960
Then on top of that, if you add
to that the heavy mineral sands,

362
00:22:12,200 --> 00:22:18,200
which by and large in average
may contain about 1% monazite,

363
00:22:18,200 --> 00:22:22,960
some 2, some nothing, China
imported 6.8 million tons of

364
00:22:22,960 --> 00:22:27,360
that with the clear objective to
extract monozide from that.

365
00:22:28,120 --> 00:22:31,000
See a totally different problem
here.

366
00:22:31,000 --> 00:22:34,200
That is that rare earth love
radioactivity.

367
00:22:34,640 --> 00:22:39,200
So inevitably for practically
most of the feedstocks, which

368
00:22:39,200 --> 00:22:44,760
sometimes includes ionic clay,
there will be radioactive waste.

369
00:22:45,640 --> 00:22:49,360
In the US there is only one
private company that is licensed

370
00:22:49,360 --> 00:22:53,160
to dispose of such radioactive
waste, that is Energy Fuels.

371
00:22:54,160 --> 00:22:58,760
In Europe, because of not in my
backyard, there are only

372
00:22:59,000 --> 00:23:04,200
temporary reception facilities
for nuclear waste.

373
00:23:04,640 --> 00:23:08,800
It is almost impossible to to
get some permanent facility

374
00:23:08,800 --> 00:23:10,320
going.
I understand they are

375
00:23:10,320 --> 00:23:14,920
commissioning now something for
nuclear fuel rods in Finland,

376
00:23:15,360 --> 00:23:18,400
but for this type of waste
mostly thorium.

377
00:23:18,640 --> 00:23:22,080
But then if you, you have
uranium, you have actinium, you

378
00:23:22,080 --> 00:23:25,520
have radium, you know, nobody
wants to have it.

379
00:23:25,640 --> 00:23:29,440
I mean, Solvay, they still have
thousands of tons lying around

380
00:23:29,440 --> 00:23:32,960
in the Lavrochet factory since
1992.

381
00:23:33,280 --> 00:23:37,680
You know, the total quantity got
distributed this about 6000 tons

382
00:23:37,680 --> 00:23:40,680
plus the rest of the quantity
somewhat distributed in

383
00:23:40,680 --> 00:23:43,560
temporary shelters across
France.

384
00:23:43,640 --> 00:23:48,760
You know, So the real point here
is the, the particularly the EU,

385
00:23:48,760 --> 00:23:52,920
but also the Americans, they
actually can't handle it because

386
00:23:52,920 --> 00:23:55,440
they don't know where to put
this waste.

387
00:23:56,040 --> 00:23:59,240
And frankly, they don't want to
incur it because what the, the,

388
00:23:59,400 --> 00:24:03,720
the products say like electric
vehicles shall appeal to to

389
00:24:03,720 --> 00:24:08,360
environmentalists also, you
know, so how is that if, if at

390
00:24:08,360 --> 00:24:11,680
the front door, you know, there
are fights over permanent

391
00:24:11,680 --> 00:24:15,360
disposal facility for the
radioactive waste that incurs

392
00:24:15,520 --> 00:24:18,160
when you want to produce the
magnets for this electric

393
00:24:18,160 --> 00:24:21,640
vehicle, you know, then suddenly
it doesn't feel so green

394
00:24:21,640 --> 00:24:25,080
anymore.
And that is actually behind EU

395
00:24:25,080 --> 00:24:28,040
policy.
They are looking for strategic

396
00:24:28,040 --> 00:24:31,880
partners, you know, as far as
possible away.

397
00:24:32,080 --> 00:24:36,760
So all this mess from mining and
the radioactive waste subject is

398
00:24:36,760 --> 00:24:39,000
totally out of mind and out of
sight.

399
00:24:39,520 --> 00:24:44,720
You know, they selected a
project in Malawi as a strategic

400
00:24:44,720 --> 00:24:49,560
project for rare earth.
At the very front door at the EU

401
00:24:49,560 --> 00:24:55,200
affiliate in Norway, there is a
gigantic deposit that is really

402
00:24:55,200 --> 00:24:59,640
high in trio and that is very,
very prospective.

403
00:25:00,160 --> 00:25:03,440
It beats anything else anywhere
near the EU.

404
00:25:04,200 --> 00:25:07,800
But it has not become a
strategic project because it

405
00:25:07,800 --> 00:25:10,760
comes with ample portion of
radioactive waste.

406
00:25:12,000 --> 00:25:16,040
Yeah, that is the fact.
On on top of that, they are also

407
00:25:16,040 --> 00:25:21,480
victims of the foghorns of
junior rare earth miners who try

408
00:25:21,480 --> 00:25:26,280
to make people believe that You
Delight can be a rare earth

409
00:25:26,280 --> 00:25:28,680
resource.
You know, the research into

410
00:25:29,160 --> 00:25:32,800
separating rare earths out of
You Delight has been going on in

411
00:25:32,800 --> 00:25:36,920
Russia since 1930.
So far we don't have anything.

412
00:25:36,920 --> 00:25:40,880
And now one of the miners in
Sweden with the You Delight

413
00:25:40,880 --> 00:25:45,040
deposit, he now says, oh, we're
looking for financing to 1st dig

414
00:25:45,040 --> 00:25:48,440
the UD light out and then leave
it there and wait until the

415
00:25:48,440 --> 00:25:51,800
process is far.
How to express from that?

416
00:25:54,680 --> 00:25:58,960
The Russians have waited for 95
years, you know, so maybe made

417
00:25:58,960 --> 00:26:02,120
another 95.
And it's the same in Greenland.

418
00:26:02,120 --> 00:26:06,280
The pain was tested in the Euro
rate program and I got very

419
00:26:06,280 --> 00:26:08,960
interested, so I looked up all
the documentation and

420
00:26:08,960 --> 00:26:13,000
everything, but it was not clear
if they ever managed to extract

421
00:26:13,000 --> 00:26:17,120
anywhere else from that.
So I wrote to the company who

422
00:26:17,120 --> 00:26:20,200
did the separation, you know, 2
times.

423
00:26:20,200 --> 00:26:25,240
They didn't reply because they
knew that I knew that they had

424
00:26:25,240 --> 00:26:28,080
failed.
You know, this is of course a

425
00:26:28,240 --> 00:26:34,120
side, say Warzine, but the real
issue here is the environmental

426
00:26:34,120 --> 00:26:39,360
problems that the politicians in
the US and also in the EU do not

427
00:26:39,480 --> 00:26:42,800
want to have these discussions
about permanent disposal

428
00:26:42,800 --> 00:26:45,480
facilities of radioactive waste
and things like that.

429
00:26:46,120 --> 00:26:47,800
Isn't the permanent disposal
facility?

430
00:26:47,800 --> 00:26:50,080
Isn't that a sticking point for
Linus in Malaysia?

431
00:26:50,080 --> 00:26:52,600
Like aren't they?
Aren't they supposed to be

432
00:26:52,600 --> 00:26:58,760
building APDF in country there?
Yes they do, at great expense.

433
00:26:58,760 --> 00:27:03,360
They also built a facility to
produce rare as carbonate and

434
00:27:03,920 --> 00:27:07,120
Australia and extract the sodium
content there.

435
00:27:07,600 --> 00:27:11,400
The composition of what is mined
at Mount Wade has changed a

436
00:27:11,400 --> 00:27:13,440
little bit.
Based on the previous

437
00:27:13,440 --> 00:27:20,280
composition, Linus output of
sodium per year was

438
00:27:20,280 --> 00:27:25,480
approximately 150 tons in a huge
stack of phosphogypsin.

439
00:27:26,200 --> 00:27:30,080
I I think the company had a
point when saying this is really

440
00:27:30,080 --> 00:27:34,120
almost irrelevant, but Malaysia
has been through the bucket

441
00:27:34,120 --> 00:27:37,560
mirror disaster of Asia rare
earth, a Mitsubishi company

442
00:27:37,960 --> 00:27:42,760
where the contractor who had
been hired to dispose of the

443
00:27:43,280 --> 00:27:47,960
sodium waste properly had duty
fully discharged it wherever he

444
00:27:47,960 --> 00:27:51,280
deemed fit by the roadside.
Basically, you know, and that

445
00:27:51,280 --> 00:27:55,760
created higher cancer rates,
miscarriages, deformations at

446
00:27:55,760 --> 00:27:57,640
birth and things like that.
The whole line.

447
00:27:57,920 --> 00:28:02,160
So in Malaysia, the rare earth
mining that is now being

448
00:28:02,160 --> 00:28:07,240
supported from the ionic clays
is called non radioactive rare

449
00:28:07,240 --> 00:28:09,880
earth mining.
So back to liners.

450
00:28:09,880 --> 00:28:13,440
They had to build a facility,
but it's, I mean, what is the

451
00:28:13,440 --> 00:28:17,200
facility?
They dig a big hole and then

452
00:28:17,200 --> 00:28:22,280
they line it out with two liners
of polyethylene plastic and then

453
00:28:22,280 --> 00:28:24,200
they pile the phosphogistin on
it.

454
00:28:24,440 --> 00:28:27,080
Versus what we're doing and what
Kalgoorlie throwing it on the

455
00:28:27,080 --> 00:28:31,920
back of a truck and just putting
it back in pit, no need carefree

456
00:28:32,600 --> 00:28:33,960
what the contrast.
It is.

457
00:28:34,240 --> 00:28:38,160
It is seriously a problem and I
think it would be much better if

458
00:28:38,160 --> 00:28:43,640
this was discussed openly and a
solution would be offered rather

459
00:28:43,640 --> 00:28:46,160
than everybody keeps it under
the carpet.

460
00:28:46,560 --> 00:28:50,720
Every junior miner who sends
samples for analysis, for every

461
00:28:50,720 --> 00:28:53,800
drill hole, he gets the full
composition of everything that

462
00:28:53,800 --> 00:28:55,960
is inside.
And if you read the drug

463
00:28:55,960 --> 00:28:59,440
reports, you also see that
sodium and uranium was tested,

464
00:28:59,800 --> 00:29:01,440
but they never published the
results.

465
00:29:02,480 --> 00:29:05,240
You have to dig that out, you
know, and calculate back and

466
00:29:05,240 --> 00:29:09,000
then you come to a value that is
the probably likely content of

467
00:29:09,000 --> 00:29:12,880
radioactive material, you know,
like this pansana thing in

468
00:29:12,880 --> 00:29:15,720
Angola.
The whole area was peddled by

469
00:29:15,720 --> 00:29:19,360
the Angolan government for
uranium and thorium, you know,

470
00:29:20,120 --> 00:29:24,960
and then early, early Pansana in
the previous incarnation as Rift

471
00:29:24,960 --> 00:29:29,600
Valley where careless enough to
publish the results of thorium

472
00:29:29,600 --> 00:29:32,640
and uranium as well.
You know, maybe they will have

473
00:29:32,680 --> 00:29:36,800
10 times the output of liners
and no one looks at the

474
00:29:36,800 --> 00:29:40,960
consequences.
I think one point I'd add to

475
00:29:41,000 --> 00:29:46,720
there, it's almost when it comes
to the radioactive elements

476
00:29:46,720 --> 00:29:49,240
around the clays.
I managed to go out and visit

477
00:29:49,240 --> 00:29:53,520
Ansto not so long ago, and I
know I'm going to butcher some

478
00:29:53,520 --> 00:29:55,680
of the quotes there, but one of
the elements that I came away

479
00:29:55,680 --> 00:30:02,000
from was the existence of low
grade in a concentrate or low

480
00:30:02,000 --> 00:30:04,840
grade in situ is almost a side
issue.

481
00:30:04,920 --> 00:30:08,040
It's what happens when you treat
it in any sort of way.

482
00:30:08,560 --> 00:30:13,040
You get this activation of
isotopes of those elements into

483
00:30:13,040 --> 00:30:16,960
some far nastier things that
perhaps, well, I couldn't

484
00:30:16,960 --> 00:30:19,160
actually name some of the
elements that were getting

485
00:30:19,160 --> 00:30:21,680
thrown off, but they sounded
particularly bad.

486
00:30:21,800 --> 00:30:25,400
And perhaps I just simplified
that whole sector as being

487
00:30:26,240 --> 00:30:28,680
simple.
OK, there's, it's all the bad

488
00:30:28,680 --> 00:30:30,440
stuff has been washed away in
situ.

489
00:30:30,600 --> 00:30:34,120
It's all clean and green.
But it turns out, hang on, you

490
00:30:34,120 --> 00:30:36,640
add a little bit of, add a
little bit of heat, add some

491
00:30:36,640 --> 00:30:40,360
chemicals in one way.
Yeah, it can dramatically

492
00:30:40,360 --> 00:30:43,000
accelerate the concentration of
those nasties and make it a a

493
00:30:43,640 --> 00:30:46,000
transport handling issue and
ultimately a disposal issue.

494
00:30:46,000 --> 00:30:50,120
Yep.
And and I I see hopeful and

495
00:30:50,120 --> 00:30:53,240
Brazil had the experience of
that.

496
00:30:53,440 --> 00:30:57,760
I look at it very primitively.
Generally, sorium will drop out

497
00:30:57,760 --> 00:31:02,120
during flotation, but the
uranium content is water

498
00:31:02,120 --> 00:31:04,320
soluble.
You know, this goes, this can go

499
00:31:04,320 --> 00:31:08,720
all the way to the final
product, which also an American

500
00:31:08,720 --> 00:31:11,200
rare earth hopeful has
experienced.

501
00:31:11,280 --> 00:31:14,560
And this is really something
that needs to be dragged out

502
00:31:14,560 --> 00:31:16,840
into the open.
I do not believe that we will

503
00:31:16,840 --> 00:31:20,640
get to any rare earth solution
if we do not address these

504
00:31:20,640 --> 00:31:23,600
issues.
See, the Chinese monazite is a

505
00:31:23,600 --> 00:31:28,640
typical usual suspect monazite.
The classic monazite has about 5

506
00:31:28,640 --> 00:31:34,920
to 6% of thorium and about 0.5
to 0.6% of uranium inside, plus

507
00:31:34,920 --> 00:31:37,280
other nasties.
But that is basically it, you

508
00:31:37,280 --> 00:31:42,920
know, so monazite is actually a
fantastic or to use for, you

509
00:31:42,920 --> 00:31:45,560
know, for a rare separation.
It's not bad.

510
00:31:46,080 --> 00:31:51,360
China banned the mining in 2012
because they had absolutely no

511
00:31:51,640 --> 00:31:54,760
control over where this waste is
going.

512
00:31:54,880 --> 00:31:58,680
And it was going into rivers and
lakes, you know, and landfills

513
00:31:58,680 --> 00:32:03,680
and so on.
You know, 2014 they closed all

514
00:32:03,760 --> 00:32:08,720
known IIC deposits in South
China also for environmental

515
00:32:08,720 --> 00:32:12,040
reasons.
This, this, this leaching with,

516
00:32:12,120 --> 00:32:16,600
with ammonium sulfate is, is a
disaster for the water

517
00:32:16,600 --> 00:32:19,240
resources, be it groundwater or
surface water.

518
00:32:19,560 --> 00:32:23,800
And if you, I mean, I'm sorry to
say, but in, in, in Malaysia,

519
00:32:24,600 --> 00:32:28,640
I've, I've seen two
environmental risk assessments

520
00:32:28,880 --> 00:32:33,040
fired on ministry websites and
the assessments were very open

521
00:32:33,040 --> 00:32:36,280
about it and they disappeared
from the website.

522
00:32:36,280 --> 00:32:39,200
Strangely.
You know, this, there's this,

523
00:32:39,880 --> 00:32:42,320
you know, on the Internet,
things evaporate, you know, you

524
00:32:42,640 --> 00:32:45,440
can't control it.
So this is something that they

525
00:32:45,440 --> 00:32:48,200
completely ignore in Malaysia,
this.

526
00:32:48,400 --> 00:32:51,200
And that is not good because
what, you know, what is the

527
00:32:51,200 --> 00:32:55,200
alternative to in situ leaching?
In situ leaching, you can leave

528
00:32:55,200 --> 00:32:58,800
the trees where they are.
If you go for strip mining and

529
00:32:58,800 --> 00:33:01,960
tank leaching, you know, what do
you do to the rainforest?

530
00:33:03,800 --> 00:33:05,160
Yeah.
Absolutely.

531
00:33:05,920 --> 00:33:07,440
In tank leaching might be even
more.

532
00:33:07,760 --> 00:33:11,360
Environmentally, actually, I
think iron absorption claims

533
00:33:11,520 --> 00:33:15,360
place on aberration.
It's not on top of that, you

534
00:33:15,360 --> 00:33:16,880
know, since we are not good at
it.

535
00:33:17,200 --> 00:33:20,360
We've seen that with junior
miners with the trial leaching,

536
00:33:20,800 --> 00:33:25,880
they managed to leach the
physically bonded ions, but the

537
00:33:25,880 --> 00:33:29,800
chemically bonded ones not.
So our recovery rates are

538
00:33:29,800 --> 00:33:35,440
anywhere between 40 and 60% on
an already low trio resource.

539
00:33:36,240 --> 00:33:39,440
Yeah, this is all not very good.
So I think it's an aberration.

540
00:33:39,440 --> 00:33:43,520
I really think we should go for
the traditional ORS that are

541
00:33:43,640 --> 00:33:46,920
provenly working.
I'll happily take the other side

542
00:33:46,920 --> 00:33:50,600
of that trade just a bit, the
arbiter of companies doing

543
00:33:50,600 --> 00:33:53,680
things better than what they've
been done in the past.

544
00:33:54,240 --> 00:33:57,000
Is your view there DK that in
situ will return and will be

545
00:33:57,000 --> 00:33:59,440
done responsibly or do you think
it'll be done, you know, tank

546
00:33:59,440 --> 00:34:02,320
leaching?
If it's going to be in Western

547
00:34:02,320 --> 00:34:06,880
hands through North American,
Australian listed group, you're

548
00:34:06,880 --> 00:34:09,040
not going to get away with full
stop.

549
00:34:09,159 --> 00:34:10,719
It's just never going to get off
the ground.

550
00:34:10,719 --> 00:34:12,400
Investors won't back it, we
won't back it.

551
00:34:13,080 --> 00:34:15,639
These guys need to bend over
backwards to ensure that

552
00:34:15,800 --> 00:34:19,239
whatever they're doing, the
footprint and the externalities

553
00:34:19,239 --> 00:34:23,840
environmentally are rock solid.
I mean, I think every side visit

554
00:34:23,840 --> 00:34:27,679
that we went to in Brazil always
went through the process about

555
00:34:28,120 --> 00:34:32,159
looking at what nearby mining
operations from bauxite had done

556
00:34:32,159 --> 00:34:35,400
on the rehab front.
And there seems to be a pretty

557
00:34:35,400 --> 00:34:39,040
simple case about the fact that
it's so low strip, it's

558
00:34:39,159 --> 00:34:43,159
relatively like thick and
therefore the footprint isn't

559
00:34:43,159 --> 00:34:45,760
actually that big.
And then such a high rainfall

560
00:34:45,760 --> 00:34:49,239
area, the ability to regenerate
was pretty high.

561
00:34:49,239 --> 00:34:53,480
But it was all about the
chemistry set about what you're

562
00:34:53,480 --> 00:34:55,920
putting back into the ground.
I mean, get rid of the ammonium

563
00:34:55,920 --> 00:34:59,280
sulfide, which of course, but
what was being put back in.

564
00:34:59,280 --> 00:35:04,280
And I think that's what I
observed to be probably spending

565
00:35:04,280 --> 00:35:07,800
a lot more time in terms of the
test work, trying to understand

566
00:35:08,800 --> 00:35:12,400
how can they put something back
that's Inuit and the cost

567
00:35:12,400 --> 00:35:15,080
associated with that.
There's always seem to be lots

568
00:35:15,080 --> 00:35:18,080
of different tanks and lots of
different complex parts.

569
00:35:18,080 --> 00:35:19,560
The flow sheet, trying to get
that right.

570
00:35:20,200 --> 00:35:24,040
Can it be done well?
I'm not sure.

571
00:35:24,040 --> 00:35:28,400
I haven't seen it yet.
But to do what was like a

572
00:35:28,400 --> 00:35:31,280
cottage industry function in
certain parts of southern China.

573
00:35:31,280 --> 00:35:35,400
Now Myanmar, they can't do it
like they've done.

574
00:35:35,400 --> 00:35:37,520
It's not going to happen
anywhere else.

575
00:35:37,720 --> 00:35:43,360
That's the Western oversight.
So I kind of think we could do

576
00:35:43,360 --> 00:35:46,760
it, but at what cost?
And could they ever raise

577
00:35:46,760 --> 00:35:47,760
capital?
I doubt it.

578
00:35:48,160 --> 00:35:49,960
What's going on with Sierra
Verde at the moment?

579
00:35:50,120 --> 00:35:52,880
I know that they needed more
capital recently, some ramp up

580
00:35:52,880 --> 00:35:55,760
challenges, but we're more
capital fixed their issues and

581
00:35:55,760 --> 00:35:56,920
they'll find a way to be
profitable.

582
00:35:57,160 --> 00:35:58,840
Yeah, that's really hard.
So sorry.

583
00:35:58,840 --> 00:36:00,600
Go ahead, Thomas.
No, please, Please go ahead.

584
00:36:00,640 --> 00:36:02,720
No, as I only have a few words
to say about this.

585
00:36:02,720 --> 00:36:05,360
I mean they're private.
We don't hear really much about

586
00:36:05,360 --> 00:36:07,560
them or they're not really
putting any information out

587
00:36:07,560 --> 00:36:09,320
there.
There are some voices in the

588
00:36:09,320 --> 00:36:11,560
industry that say like they have
problem with their filter

589
00:36:11,560 --> 00:36:14,200
systems which are kind of
ruining recoveries there.

590
00:36:14,480 --> 00:36:16,800
That's all I know.
So from what I've heard, the

591
00:36:16,800 --> 00:36:20,480
ramp up is not going as planned.
Maybe Thomas can give more

592
00:36:20,520 --> 00:36:23,320
respect on this, but this
certainly has like with

593
00:36:23,360 --> 00:36:25,760
influence on what what what
we'll see happening in Meteoric

594
00:36:25,760 --> 00:36:28,000
and for it is.
The mining doesn't only happen

595
00:36:28,000 --> 00:36:31,520
in Myanmar, it also happens in
Laos at ever increasing rates

596
00:36:31,920 --> 00:36:35,200
and also in Malaysia.
We are seeing more and more

597
00:36:35,200 --> 00:36:38,800
coming out of Malaysia.
I know some couple, a couple of

598
00:36:38,800 --> 00:36:42,160
guys there.
That's of course Chinese capital

599
00:36:42,160 --> 00:36:45,560
and Chinese labour involved in
Malaysia.

600
00:36:46,640 --> 00:36:50,840
Anyway, it is done the cheapest
possible way.

601
00:36:51,240 --> 00:36:57,080
And if you pump ammonium sulfate
solution into the ground, 10

602
00:36:57,080 --> 00:37:00,600
millions of litres.
You know, it's naive to assume

603
00:37:00,760 --> 00:37:02,680
that you could clean this up in
any way.

604
00:37:02,680 --> 00:37:06,040
This simply doesn't have so tank
leaching.

605
00:37:06,520 --> 00:37:11,720
But we know that these type of
clays, they are found in areas

606
00:37:11,720 --> 00:37:17,080
of heat and a lot of rain.
So that's basically tropical

607
00:37:17,080 --> 00:37:22,040
rainforest.
So if we say, OK, this deposit

608
00:37:22,040 --> 00:37:26,080
is very wide and it's only 40
meters deep, or let it be 50

609
00:37:26,080 --> 00:37:29,680
meters early strip mined, you
have to remove all the greenery

610
00:37:30,240 --> 00:37:36,080
and you will not restore a
forest within a few years.

611
00:37:36,080 --> 00:37:39,880
It simply doesn't happen.
There are also cases where strip

612
00:37:39,880 --> 00:37:44,600
mining is removing a layer of
clay that used to be holding the

613
00:37:44,600 --> 00:37:49,120
water, you know, so that the
soil remains humid and suddenly

614
00:37:49,120 --> 00:37:52,760
of desertification.
Some satellite photos from

615
00:37:52,760 --> 00:37:58,240
Myanmar suggests that happening.
You know, so I really do not

616
00:37:58,760 --> 00:38:03,680
believe in iron absorption clays
being a solution of the problem.

617
00:38:04,120 --> 00:38:05,680
So that raises an interesting
question.

618
00:38:05,720 --> 00:38:09,600
Say we don't want to source
heavy from ionic class, where do

619
00:38:09,600 --> 00:38:12,520
we source them I mean?
Very small deposits.

620
00:38:12,760 --> 00:38:15,760
It's also sometimes part of
monozide deposits.

621
00:38:15,760 --> 00:38:20,320
Monozide itself tends to have a
favorable composition.

622
00:38:21,000 --> 00:38:23,960
And don't forget we are
engineering for example, for the

623
00:38:23,960 --> 00:38:27,200
magnet rare earths, whether in
the West or in the east,

624
00:38:27,200 --> 00:38:30,320
particularly in China, we are
engineering the heavy rare

625
00:38:30,320 --> 00:38:34,320
earths out because this is
something that most union rare

626
00:38:34,320 --> 00:38:37,720
earths miners simply don't
understand, the rare earths

627
00:38:37,720 --> 00:38:42,240
inherent imbalance.
Every deposit has a different

628
00:38:42,240 --> 00:38:47,760
proportional composition, but
none of them has a composition

629
00:38:48,040 --> 00:38:51,520
that is exactly according to the
market demand.

630
00:38:51,920 --> 00:38:57,680
So that means we, if we want to
produce enough neodymium for the

631
00:38:57,680 --> 00:39:02,200
market demand, we over produce
lansanum, cerium and samarium

632
00:39:02,720 --> 00:39:08,800
and we under produce dysprosium,
terbium and probably hernium.

633
00:39:09,840 --> 00:39:12,400
So if we then say ah no, no, no,
we changed that.

634
00:39:12,520 --> 00:39:16,040
We make this prosium the target
and we produce this prosium

635
00:39:16,080 --> 00:39:19,320
according to market demand, then
we will over produce also

636
00:39:19,320 --> 00:39:22,840
neodymium and prosium, not
everything else for that matter.

637
00:39:23,200 --> 00:39:28,160
And God save us if Thulium one
day should take off.

638
00:39:28,400 --> 00:39:31,520
The whole balance will be
screwed if you have to.

639
00:39:31,600 --> 00:39:34,960
There's a reason why Lancelon
costs only $0.60.

640
00:39:35,120 --> 00:39:38,360
There's a reason why Cerium only
costs $1.60.

641
00:39:38,360 --> 00:39:41,440
There's a reason why Terbium
costs $1000.

642
00:39:42,000 --> 00:39:45,880
You throw the whole thing out of
balance, whatever you do.

643
00:39:46,040 --> 00:39:48,320
And this is something the
Chinese have been wrestling with

644
00:39:48,360 --> 00:39:50,840
for decades.
And people from the outside who

645
00:39:50,840 --> 00:39:54,120
look at it, they think, oh, they
are manipulating the prices.

646
00:39:54,120 --> 00:39:56,720
They keep it cheap in order to
keep us out of the market.

647
00:39:57,200 --> 00:39:58,920
Nothing could be further from
the truth.

648
00:39:59,200 --> 00:40:04,000
It is supply and demand, and
it's the living hell of the rare

649
00:40:04,000 --> 00:40:06,840
earth inherent imbalance that
you see at work.

650
00:40:07,320 --> 00:40:09,960
That's all very good points.
I totally agree with you there,

651
00:40:10,240 --> 00:40:12,240
which does raise an interesting
question.

652
00:40:12,560 --> 00:40:15,680
You talked about natural ratios.
We've seen the carbon tides in

653
00:40:15,680 --> 00:40:17,560
monoxide sometimes very
different.

654
00:40:17,920 --> 00:40:21,520
But since I only know of one
pureplay, seen a time deposit

655
00:40:21,520 --> 00:40:23,720
which has like a small chance of
making it bronze range.

656
00:40:23,960 --> 00:40:27,000
Think you know it very well.
So what could be if we don't

657
00:40:27,000 --> 00:40:29,640
want to do in situ leaching?
What could possibly fill this

658
00:40:29,640 --> 00:40:32,160
gap?
Are there more pure casino time

659
00:40:32,160 --> 00:40:34,360
deposit?
Do price need to rise in order

660
00:40:34,360 --> 00:40:36,840
for bronze range to be
economical?

661
00:40:37,400 --> 00:40:38,960
Yeah.
First of all, there are two

662
00:40:39,480 --> 00:40:42,720
projects under development.
One is another, minerals and the

663
00:40:42,720 --> 00:40:45,800
other one is Namibia critical
metals.

664
00:40:46,520 --> 00:40:48,760
These are the famous ones under
development.

665
00:40:49,120 --> 00:40:52,240
The other thing is, and that is
also where China is the

666
00:40:52,240 --> 00:40:57,600
trailblazer.
They engineer dysprosium and

667
00:40:57,600 --> 00:41:01,560
turbium out of the magnet.
For example.

668
00:41:01,560 --> 00:41:04,720
They have a technology and it's
patent and it's grain boundary

669
00:41:04,720 --> 00:41:08,560
diffusion.
The idea is OK, we need to alloy

670
00:41:08,640 --> 00:41:12,400
the NDFEB magnet so it becomes
more heat resistant.

671
00:41:12,880 --> 00:41:15,880
But where does the heat impact
the magnet?

672
00:41:16,600 --> 00:41:18,400
On the surface?
Not inside.

673
00:41:18,880 --> 00:41:21,840
So inside you don't need that
much dysprosium.

674
00:41:22,400 --> 00:41:23,920
You actually don't need any at
all.

675
00:41:23,920 --> 00:41:27,960
You need it at the outside.
This grain boundary diffusion

676
00:41:27,960 --> 00:41:32,560
technology allows them to reduce
the dysprosium content while

677
00:41:32,600 --> 00:41:35,400
maintaining the temperature
resistance.

678
00:41:35,760 --> 00:41:39,720
You know so.
So there are two ways to address

679
00:41:39,720 --> 00:41:41,080
this.
One is of course produce a

680
00:41:41,080 --> 00:41:44,360
little bit more, but the other
one is to engineer them out of

681
00:41:44,360 --> 00:41:46,240
the applications as far as
possible.

682
00:41:47,480 --> 00:41:49,840
To what degree do you think like
the easy gains have been made on

683
00:41:49,840 --> 00:41:55,160
that front, like has been around
for a couple years, like yes, we

684
00:41:55,160 --> 00:41:58,920
see man plateau here or will we
see further reduction?

685
00:42:00,000 --> 00:42:03,880
Well, there's there's another
trend that was discussed last

686
00:42:03,880 --> 00:42:07,440
year at the Rare Earth Industry
Association conference.

687
00:42:07,840 --> 00:42:11,560
I do not know what has become of
this, but it's simply cooling.

688
00:42:13,760 --> 00:42:16,280
You have a cooling system, you
have batteries that get hot, and

689
00:42:16,280 --> 00:42:18,640
when they get hot they don't
perform that well.

690
00:42:18,640 --> 00:42:22,480
So there are automotive
developers who work on an

691
00:42:22,480 --> 00:42:25,960
electric vehicle cooling system,
in which case you don't need a

692
00:42:25,960 --> 00:42:30,800
working temperature for the
magnet of say, 180°C, but you

693
00:42:30,800 --> 00:42:33,400
could maybe live with 150 or
even lower.

694
00:42:34,320 --> 00:42:37,640
That's the application research.
We must not forget that the

695
00:42:37,640 --> 00:42:41,400
Western automotive manufacturers
likes things cheap.

696
00:42:41,880 --> 00:42:46,320
The neodymium magnet is the most
energy efficient and powerful

697
00:42:46,320 --> 00:42:48,880
and lightweight magnet that we
know.

698
00:42:48,880 --> 00:42:52,440
And but you know, do we?
Do we need passenger vehicles

699
00:42:52,440 --> 00:42:57,200
with 400 horsepowers that
accelerate from zero to 100

700
00:42:57,200 --> 00:43:02,000
kilometers an hour and 3 seconds
in on our highways and in our

701
00:43:02,000 --> 00:43:05,480
congested cities.
I mean, I had a car in Toronto,

702
00:43:05,480 --> 00:43:08,600
you know, jogging was faster, so
to say.

703
00:43:08,760 --> 00:43:13,720
There are alternative motors,
say magnet based ones, or you

704
00:43:13,720 --> 00:43:17,080
look at BMW, they who build a
complete powertrain.

705
00:43:17,400 --> 00:43:20,760
All this is possible.
Of course, then defenders of

706
00:43:20,760 --> 00:43:25,200
NDFEB and of top performance
will say, oh, but then the

707
00:43:25,200 --> 00:43:28,920
battery, then you don't get a
range of 800 kilometers, you

708
00:43:28,920 --> 00:43:32,480
only get 600 kilometers.
Who cares?

709
00:43:33,440 --> 00:43:36,160
Seriously, battery technology is
moving on.

710
00:43:36,160 --> 00:43:38,960
We are going to see the
solid-state battery with a range

711
00:43:38,960 --> 00:43:42,880
of 1100 kilometers given an NDF
EB motor.

712
00:43:43,120 --> 00:43:47,680
If it then with ferrite motor
only delivers 700 kilometers,

713
00:43:47,800 --> 00:43:50,400
who cares?
Yeah, OK.

714
00:43:51,640 --> 00:43:54,440
You've had a long time view on
backing the incumbent.

715
00:43:54,440 --> 00:43:57,560
I'm curious to hear you're
somewhat in enthusiasm from an

716
00:43:57,560 --> 00:44:00,360
equity perspective on the ION,
except have your rules changed?

717
00:44:00,840 --> 00:44:03,960
So let's get back over the rules
quickly.

718
00:44:04,600 --> 00:44:08,800
So back the incumbents, barriers
to entry far too high capital

719
00:44:08,800 --> 00:44:14,640
cost, operating cost, economic
returns or no go #2 never go

720
00:44:14,640 --> 00:44:16,760
full retard.
Stay upstream.

721
00:44:17,800 --> 00:44:21,960
You go from a mine to a
concentrate, maybe a carbonite.

722
00:44:23,440 --> 00:44:26,080
And that way you're probably
going to just do a Forrest Gump

723
00:44:26,080 --> 00:44:29,840
or arraignment like to go any
further downstream into

724
00:44:29,840 --> 00:44:35,040
separated oxides through through
corn, mixed carbonite, crack it,

725
00:44:35,440 --> 00:44:37,440
separate it.
That's to go full retard.

726
00:44:37,600 --> 00:44:41,960
That's like I am Sam, simple
Jack, simple Jack.

727
00:44:43,240 --> 00:44:49,880
So very, very sort of precise
focus on the strategy, low shape

728
00:44:49,880 --> 00:44:52,200
and the test work.
Final element.

729
00:44:52,440 --> 00:44:58,040
If we do start straying into
large scale separation tech, you

730
00:44:58,040 --> 00:45:00,440
need the explicit backing of a
state.

731
00:45:01,320 --> 00:45:06,600
So what we've seen with Iluka
coming in being backed by

732
00:45:06,600 --> 00:45:12,640
Australia was I by the US What
Linus did had with the Japanese,

733
00:45:12,760 --> 00:45:14,640
that sort of equivalent sort of
backing.

734
00:45:16,320 --> 00:45:21,760
So the strategies I thought were
appealing around Clay's remained

735
00:45:22,200 --> 00:45:25,800
relatively positive.
I think everything was hinging

736
00:45:25,800 --> 00:45:27,120
on this.
Sarah Verde getting up.

737
00:45:27,520 --> 00:45:30,120
And the trouble that we just
discussed briefly before

738
00:45:30,760 --> 00:45:35,120
indicates that, well, the
problems are perhaps more than

739
00:45:35,120 --> 00:45:39,120
we thought.
And if it's a black box and no

740
00:45:39,120 --> 00:45:42,360
news is getting out, and I think
Thomas has put out a couple of

741
00:45:42,360 --> 00:45:46,080
posts citing the fact that
they've had some straggly export

742
00:45:46,680 --> 00:45:49,880
trade data come out that
indicates that it's perhaps not

743
00:45:49,880 --> 00:45:53,960
working well.
Maybe the test work wasn't done

744
00:45:53,960 --> 00:45:56,160
enough.
Maybe it was forced at the wrong

745
00:45:56,160 --> 00:45:59,240
time and by a private equity
group that perhaps wasn't

746
00:45:59,240 --> 00:46:02,040
necessarily focused on the
problems on the ground with

747
00:46:02,040 --> 00:46:04,120
solving that need to happen on
the flow sheet.

748
00:46:05,040 --> 00:46:10,800
In my mind, I find it very hard
to get constructive on other

749
00:46:10,800 --> 00:46:13,080
types of development plays in
the equity space.

750
00:46:14,000 --> 00:46:17,320
I think Brazilian rare earths
and what they're doing or

751
00:46:17,320 --> 00:46:23,840
perhaps what they've got with
this high grade high radium, you

752
00:46:23,840 --> 00:46:29,800
know, high grade cool was a treo
values of over 10 percent 4000

753
00:46:30,360 --> 00:46:32,560
PPM uranium.
That's something different.

754
00:46:33,120 --> 00:46:34,360
That's interesting.
That's high in assigned

755
00:46:34,360 --> 00:46:37,800
material, but obviously there's
the problems of the flow sheet.

756
00:46:39,040 --> 00:46:48,200
So in my mind, Mei VMM, they
still have a strategic appeal in

757
00:46:48,200 --> 00:46:51,920
terms of that potential sort of
disruption concept.

758
00:46:52,840 --> 00:46:55,840
But I think Thomas is making
some good points there around

759
00:46:57,000 --> 00:47:01,440
rehab treatment properly.
And I think some of our recent

760
00:47:01,440 --> 00:47:05,080
technical discussions or deeper
dives there have indicated that

761
00:47:05,560 --> 00:47:11,600
we've perhaps simplified the
radionuclide issues to a point

762
00:47:11,600 --> 00:47:13,520
where we're overlooking 5 mega
problems.

763
00:47:14,480 --> 00:47:16,880
Like the chemistry set in these
things is unbelievably

764
00:47:16,880 --> 00:47:19,360
complicated no matter which set
you look at.

765
00:47:20,040 --> 00:47:22,560
Clays are something different.
Only a couple of stages, basic

766
00:47:23,480 --> 00:47:28,080
bleaching, but every time I've
looked at project, the closer

767
00:47:28,080 --> 00:47:30,360
you dig, the more convoluted and
complex it becomes.

768
00:47:30,760 --> 00:47:35,200
So I think in my mind you're
still backing the incumbents.

769
00:47:35,480 --> 00:47:39,360
And I say smaller, isolated
exposure to those that can

770
00:47:39,360 --> 00:47:43,080
disrupt the market through
conventional simple means

771
00:47:43,120 --> 00:47:46,280
finally going upstream, focusing
on those names.

772
00:47:46,720 --> 00:47:48,600
I found that point on Sierra
Verde interesting.

773
00:47:48,600 --> 00:47:50,400
JD Like what?
What?

774
00:47:50,760 --> 00:47:53,680
Maybe some work wasn't done
properly to understand things

775
00:47:53,680 --> 00:47:55,600
when you were doing the work to
put it all together.

776
00:47:55,600 --> 00:47:58,560
Maybe things were you know what,
what is that a function of the

777
00:47:58,560 --> 00:47:59,760
amount of drilling that was
done?

778
00:47:59,760 --> 00:48:01,600
Is that a function of the sample
management?

779
00:48:01,720 --> 00:48:04,280
Because you know what sorts out
both of those things?

780
00:48:05,760 --> 00:48:08,000
Poking a few holes in mate.
Really drilling.

781
00:48:08,920 --> 00:48:11,120
And if you are going to drill,
mate, there's only one team to

782
00:48:11,120 --> 00:48:13,280
go with the mighty K Drill.
K drill mate.

783
00:48:13,280 --> 00:48:15,480
Doesn't matter if there's a few
exploration holes or a multi

784
00:48:15,640 --> 00:48:18,480
year program to prove it up,
they'll look after you.

785
00:48:19,200 --> 00:48:22,320
And like you were saying, mate,
not just a matter of punching in

786
00:48:22,360 --> 00:48:24,640
the meters, right?
You want to get it done safely

787
00:48:24,720 --> 00:48:26,800
and you want to get it done
productively.

788
00:48:26,840 --> 00:48:29,040
No downtime, no dramas, no
hassle.

789
00:48:29,560 --> 00:48:31,920
A drill.
You want productive drilling,

790
00:48:31,920 --> 00:48:34,040
You want sampling.
Sample matters, mate.

791
00:48:34,040 --> 00:48:37,240
It's got to be reliable, clean,
accurate, no contamination.

792
00:48:37,240 --> 00:48:39,240
You've got to be able to trust
the numbers.

793
00:48:39,640 --> 00:48:43,040
And last but not least, mate,
the team has got decades of

794
00:48:43,040 --> 00:48:45,120
years of experience.
They'll mobilize quickly and

795
00:48:45,120 --> 00:48:47,320
they'll just get the job done.
Doesn't matter where in the

796
00:48:47,320 --> 00:48:48,960
state they are, they get the job
done.

797
00:48:48,960 --> 00:48:51,200
Yeah, it doesn't matter the type
of drilling, they find a way.

798
00:48:51,200 --> 00:48:54,280
It's just simple as that.
Go K drill.

799
00:48:54,920 --> 00:49:00,080
Look at the market caps of Linus
and MP and what like the Linus

800
00:49:00,080 --> 00:49:03,640
is like a $9 billion Australian
company now and doesn't make

801
00:49:03,640 --> 00:49:06,200
money.
Like top line revenue in the

802
00:49:06,200 --> 00:49:10,520
entire like between MP and Linus
is like 550 million last

803
00:49:10,520 --> 00:49:12,200
quarter.
And look at the collective

804
00:49:12,200 --> 00:49:14,400
market cap of those two
companies, it's enormous.

805
00:49:14,400 --> 00:49:17,800
So the equity valuations are
biking in much, much, much

806
00:49:17,800 --> 00:49:20,600
higher prices.
Is it realistic to think that

807
00:49:20,600 --> 00:49:22,600
way about the future?
I suppose it's more of a

808
00:49:22,600 --> 00:49:25,960
discussion for the team here.
Look, in my mind, businesses

809
00:49:25,960 --> 00:49:29,520
like this, it's not a producing
A commodity, it's producing

810
00:49:29,760 --> 00:49:34,840
specialty chemical product.
They can do so at high margin to

811
00:49:34,920 --> 00:49:38,640
a very grateful customer base
that's got some sort of

812
00:49:38,640 --> 00:49:40,800
certainty for an external supply
chain.

813
00:49:41,640 --> 00:49:44,280
It's hard to do berries the most
enormous.

814
00:49:45,720 --> 00:49:49,360
They probably should be trading
at something like uranium,

815
00:49:49,560 --> 00:49:53,600
chemical kind of multiple.
I don't necessarily think about

816
00:49:53,600 --> 00:49:57,800
this in terms of like an NNDPR
function, but you've got to

817
00:49:57,800 --> 00:50:01,080
value these guys somehow on a
commodity price in the future.

818
00:50:02,680 --> 00:50:05,280
But this is a very complicated
product.

819
00:50:05,920 --> 00:50:08,560
It's a wrap your head around in
terms of the supply and demand

820
00:50:08,560 --> 00:50:10,800
function and what's going on in
China.

821
00:50:11,720 --> 00:50:16,080
So all I'll say and I'll lead
into what's the colleagues here

822
00:50:17,240 --> 00:50:20,560
in my mind.
Yes, prices need to rise what

823
00:50:21,480 --> 00:50:24,360
threefold in order to get to
incentive levels for Western

824
00:50:24,360 --> 00:50:27,000
developers.
But what's missing from that

825
00:50:27,000 --> 00:50:32,400
discussion is what cost of
production is for an upstart in

826
00:50:32,880 --> 00:50:36,680
the developing world, and their
cost of production and their

827
00:50:36,680 --> 00:50:40,640
cost of capital.
In my mind, there's a lot of

828
00:50:40,640 --> 00:50:44,360
supply that can come on.
As we know it's pretty abundant

829
00:50:44,360 --> 00:50:47,160
in the Earth's crust.
If there's a simple processing

830
00:50:47,160 --> 00:50:50,160
mechanism that can be tapped,
we've got to be thinking about

831
00:50:50,160 --> 00:50:55,040
this alongside an existing cost
of production competition.

832
00:50:55,520 --> 00:50:57,000
Yeah, those are very interesting
points.

833
00:50:57,000 --> 00:51:00,000
You make that and I totally
agree also to your point of

834
00:51:00,200 --> 00:51:02,160
investing upstream to the
concentrated carbonate level, I

835
00:51:02,160 --> 00:51:04,360
totally agree there, especially
when you're producing

836
00:51:04,360 --> 00:51:06,480
concentrate.
We see so many miners who just

837
00:51:06,480 --> 00:51:08,720
feel at the PA studies for the
concentrate.

838
00:51:08,720 --> 00:51:10,480
So did it decide to go to
carbonate?

839
00:51:10,480 --> 00:51:14,120
But the funny fact is carbonate,
it's a 0% margin value add

840
00:51:14,120 --> 00:51:15,200
there.
It's not making any money.

841
00:51:15,200 --> 00:51:18,760
It's even just inflating your
CapEx and your ability to get

842
00:51:18,760 --> 00:51:21,120
this mine online.
I actually do take the

843
00:51:21,120 --> 00:51:22,920
counterpoint there.
I think there's a lot of supply

844
00:51:22,920 --> 00:51:24,680
that might come online in the
next few years.

845
00:51:24,680 --> 00:51:27,400
In the short term, three to five
years, I have quite some

846
00:51:27,400 --> 00:51:31,920
confidence in Energy Fuels.
The main costs the structure in

847
00:51:32,080 --> 00:51:34,120
producing oxide is to
concentrate itself.

848
00:51:34,120 --> 00:51:37,040
What Energy Fuels are doing very
smartly is they're sourcing

849
00:51:37,040 --> 00:51:40,360
their monocyte byproducts from
their heavy mineral sense.

850
00:51:40,760 --> 00:51:44,920
So they can probably source it
like have to concentrate cost of

851
00:51:44,920 --> 00:51:47,520
other producers, which gives
them some flexibility for their

852
00:51:47,520 --> 00:51:51,760
extraction circuits and oxide
production there to do it at low

853
00:51:51,760 --> 00:51:53,800
cost.
Also on Brazilian records, I'm

854
00:51:53,800 --> 00:51:55,080
finding these guys pretty
interesting.

855
00:51:55,080 --> 00:51:58,480
I do agree that the flow sheet,
it's probably more complex than

856
00:51:58,480 --> 00:52:00,720
what we've seen to date.
In many miners they find this

857
00:52:00,720 --> 00:52:03,320
new mineral face, it's called
Chefkinites.

858
00:52:03,400 --> 00:52:05,800
We haven't seen this on a
commercial scale to date in the

859
00:52:05,800 --> 00:52:08,720
industry, but actually published
today some pretty interesting

860
00:52:08,760 --> 00:52:10,400
metallurgy results in their
AMREC.

861
00:52:10,480 --> 00:52:13,360
So they're producing a clean
AMREC just with direct leaching

862
00:52:13,360 --> 00:52:15,400
of their ore, which is
interesting.

863
00:52:15,880 --> 00:52:20,120
I do agree, like from a capital
term perspective, almost none of

864
00:52:20,120 --> 00:52:21,520
these miners are going to make
it.

865
00:52:21,520 --> 00:52:25,320
Like let's look back at the last
20 years, we've seen an MP

866
00:52:25,320 --> 00:52:27,680
resort, we've seen Mount Wealth
come into production and 0

867
00:52:27,680 --> 00:52:29,560
further.
That's three mines in 20 years.

868
00:52:30,040 --> 00:52:31,200
How many juniors are there out
there?

869
00:52:31,200 --> 00:52:33,720
Probably 100.
So you're really looking for

870
00:52:33,720 --> 00:52:35,680
these juniors.
If you're looking at hard work,

871
00:52:35,680 --> 00:52:39,400
you're looking at like a high
startup PF high grades, probably

872
00:52:39,720 --> 00:52:43,320
15% trio, somewhere, somewhere
around that range if you want to

873
00:52:43,320 --> 00:52:45,160
have capital payback and then
you can go lower.

874
00:52:45,160 --> 00:52:49,040
But let's realize that MP, it's
like 6% trio, which is already

875
00:52:49,040 --> 00:52:51,800
loss making.
So that's probably your lower

876
00:52:51,800 --> 00:52:55,280
boundary there.
I think, if I may say, why did

877
00:52:55,280 --> 00:52:58,440
Linus work?
Because of course they have a

878
00:52:58,440 --> 00:53:03,800
very, very patient financier who
also had to rescue them in

879
00:53:03,800 --> 00:53:07,360
between.
And the more important thing,

880
00:53:08,440 --> 00:53:12,920
they had a ready market, Japan.
Japan is the only functioning

881
00:53:13,200 --> 00:53:18,280
rare earth market outside China.
The rest of us are only extras

882
00:53:18,280 --> 00:53:21,840
basically.
So Linus had the support from

883
00:53:21,840 --> 00:53:26,440
Japan, from the Japan non
government entity that is very

884
00:53:26,440 --> 00:53:30,640
governmental and the Japanese
market that is very, very

885
00:53:30,640 --> 00:53:34,320
important.
This is how they could grow MP

886
00:53:34,320 --> 00:53:39,280
materials and my opinion they
could reopen the mind because

887
00:53:40,280 --> 00:53:43,600
the Chinese shareholder offered
them the market to sell the

888
00:53:43,600 --> 00:53:48,280
concentrate.
MP were making money until they

889
00:53:48,280 --> 00:53:52,080
started fiddling around with
things trying to reduce a

890
00:53:52,080 --> 00:53:58,520
separation process and separate
NDPR and probably also some guns

891
00:53:58,520 --> 00:54:02,560
on cerium.
And that that I think is where

892
00:54:02,560 --> 00:54:08,000
the misery started because see,
liners now want to increase

893
00:54:08,000 --> 00:54:14,080
product capacity and but already
now where does the NDPR go?

894
00:54:14,320 --> 00:54:20,200
Japan has a market of 5200 tons
of neodymium and NDPR per year.

895
00:54:20,400 --> 00:54:25,520
So where does the rest go?
China and then they conveniently

896
00:54:25,520 --> 00:54:28,160
stop separating at the
promethium gap.

897
00:54:29,400 --> 00:54:35,720
So they have the so-called SEGH,
which is some arium, erbium,

898
00:54:35,720 --> 00:54:39,760
gadolinium and holmium which the
concentrate of which they sent

899
00:54:39,760 --> 00:54:44,840
to China.
And they they can be so grateful

900
00:54:44,920 --> 00:54:48,840
that China is taking it.
And, you know, then then this me

901
00:54:48,840 --> 00:54:51,640
too company called Brazilian
Rare Earths.

902
00:54:51,640 --> 00:54:54,760
Yeah.
They go and say, oh, produce a

903
00:54:54,800 --> 00:54:57,920
carbonate that is marketable.
Marketable to whom?

904
00:54:57,920 --> 00:55:00,760
Please, who will buy this?
Yeah.

905
00:55:01,000 --> 00:55:06,440
And then we will also have an
seg that will find a ready

906
00:55:06,440 --> 00:55:11,600
market where please, you know,
assuming that China will forever

907
00:55:11,600 --> 00:55:14,840
be the trash can for junior rare
earth minor concepts.

908
00:55:14,840 --> 00:55:19,600
You know, I would not be so sure
where what we are looking at in

909
00:55:19,600 --> 00:55:25,600
the current politics may well be
China getting selective on what

910
00:55:25,600 --> 00:55:28,920
it buys from whom.
Previously China was not

911
00:55:28,920 --> 00:55:33,800
interested in what rare earths
was produced from imported rare

912
00:55:33,800 --> 00:55:36,880
earths raw materials.
Since this year it is.

913
00:55:36,880 --> 00:55:39,120
So everything falls on the
quota.

914
00:55:39,760 --> 00:55:43,360
And then they've clearly shown
that they may become selective

915
00:55:43,920 --> 00:55:47,760
because the Malaysian government
has been asking China for rare

916
00:55:47,760 --> 00:55:50,200
earth technology for years for
licensing.

917
00:55:50,720 --> 00:55:55,800
So ahead of XI Jinping's recent
visit, licenses were prepared

918
00:55:57,360 --> 00:56:02,040
for the in situ leaching and the
carbonate production from IAC

919
00:56:02,040 --> 00:56:06,920
deposits.
A week before Xi Jinping went to

920
00:56:06,920 --> 00:56:09,920
Malaysia, these licenses were
ready to be sent.

921
00:56:11,160 --> 00:56:14,520
But this is something that the
miners of Malaysia already have.

922
00:56:15,040 --> 00:56:17,040
They have the Chinese workers
there.

923
00:56:17,040 --> 00:56:20,320
They have the experts, They have
the geologists, the geochemists.

924
00:56:20,320 --> 00:56:22,960
Everything is there.
They didn't need this.

925
00:56:23,440 --> 00:56:25,560
But the Malaysian government, of
course, didn't know.

926
00:56:25,560 --> 00:56:28,480
So they were really, really
grateful about these licenses.

927
00:56:28,480 --> 00:56:32,640
Yeah, but China has absolutely
no intention to go beyond that.

928
00:56:33,160 --> 00:56:36,680
One thing I'd like to remark
with regard to carbonate also

929
00:56:36,960 --> 00:56:42,120
there's a very clearly visible
trend that instead of shipping a

930
00:56:42,320 --> 00:56:48,840
comparatively low price
carbonate Myanmar laws and also

931
00:56:48,840 --> 00:56:53,360
recently Malaysia actually
shipped mixtures oxides.

932
00:56:53,800 --> 00:56:59,200
So after calcination, basically
the the difference is you do not

933
00:56:59,320 --> 00:57:02,160
the end user does not need to
calcinate anymore and can

934
00:57:02,160 --> 00:57:05,880
probably go directly into the
solvent extract.

935
00:57:06,120 --> 00:57:08,880
So this increases also the
number of customers.

936
00:57:10,400 --> 00:57:13,880
So anyway, but you know, I think
we we have to slowly get used to

937
00:57:13,880 --> 00:57:18,960
a situation where China is not
available anymore to take junior

938
00:57:18,960 --> 00:57:26,720
minor raw materials and that we
are stuck with do it And then we

939
00:57:26,720 --> 00:57:30,800
also have to look at, you know,
producing market etiquette

940
00:57:30,800 --> 00:57:33,600
quantities.
It doesn't help you if you have

941
00:57:33,600 --> 00:57:38,720
a gigantic separation facility,
if only for a fraction.

942
00:57:38,720 --> 00:57:42,120
You have a market domestically
and need to export the rest

943
00:57:42,240 --> 00:57:45,600
against China.
You know, So I think we need a

944
00:57:45,680 --> 00:57:48,800
complete rethink.
Isn't that kind of perplexing

945
00:57:49,640 --> 00:57:52,240
then?
If we all kind of agree that the

946
00:57:52,440 --> 00:57:58,320
equity case for almost every
opportunity is dismal, isn't

947
00:57:58,320 --> 00:58:01,320
perplexing how much brainpower
we all put into this specialty

948
00:58:01,320 --> 00:58:04,360
commodity?
Matt I mean, ever spend any time

949
00:58:04,360 --> 00:58:06,720
looking at some of the detailed
financials about how much mining

950
00:58:06,720 --> 00:58:08,720
companies actually make?
That's a very good point.

951
00:58:08,920 --> 00:58:11,400
And I mean, what's also
interesting is when we look at

952
00:58:11,600 --> 00:58:14,600
all these juniors, they're all
bodies, they're MP studies, you,

953
00:58:14,800 --> 00:58:16,920
you name it.
Like you say, it's dismissal,

954
00:58:16,920 --> 00:58:19,120
like almost none of these can
ever make money.

955
00:58:19,560 --> 00:58:23,880
But I think something we have to
accept is look at MP, look at

956
00:58:23,880 --> 00:58:26,600
Linus, they traded like 5 times
their MPP.

957
00:58:26,600 --> 00:58:31,200
Like that's just marked reality.
So it's very risky to invest in

958
00:58:31,200 --> 00:58:34,000
a junior based on the perception
that after once you start

959
00:58:34,000 --> 00:58:37,360
producing, it's going to rewrite
to such an level.

960
00:58:37,600 --> 00:58:39,040
But it's something we have to
keep in mind.

961
00:58:39,040 --> 00:58:42,120
But basically, if you're still a
junior, you know it on an NFV

962
00:58:42,120 --> 00:58:45,760
basis, it's very risky.
And none of these juniors are,

963
00:58:46,040 --> 00:58:48,800
except a couple in my mind are
interesting to look at.

964
00:58:50,280 --> 00:58:52,640
We are.
Also a little bit unfair.

965
00:58:53,680 --> 00:58:57,600
And our western civilized
nations completely lack the

966
00:58:58,040 --> 00:59:03,120
value chain of rare earths.
So for junior miners to show

967
00:59:03,120 --> 00:59:08,000
something that is interesting,
they have to get into something

968
00:59:08,240 --> 00:59:11,880
that they are actually not
experts in and can never be.

969
00:59:12,240 --> 00:59:16,200
For a miner, he's turning out a
concentrate.

970
00:59:16,560 --> 00:59:20,000
That's it.
He's not supposed to produce in

971
00:59:20,000 --> 00:59:22,840
the Feb magnet.
The networking capital will

972
00:59:22,840 --> 00:59:24,640
crush him.
Forget it.

973
00:59:24,840 --> 00:59:27,560
It just doesn't work.
Or have you ever heard of an

974
00:59:27,560 --> 00:59:30,920
iron ore miner who's producing
precision steel tubes?

975
00:59:31,480 --> 00:59:33,720
Yeah.
So this would be the equivalent.

976
00:59:33,880 --> 00:59:37,560
So it's maybe the expectation
level is too high.

977
00:59:38,120 --> 00:59:42,800
What I would recommend is having
a really, really close look how

978
00:59:42,800 --> 00:59:47,360
the value chain is structured in
China, which is everyone is a

979
00:59:47,360 --> 00:59:50,400
specialist in his particular
part of the value chain.

980
00:59:50,680 --> 00:59:53,760
And these are companies that are
independent, that they have

981
00:59:53,760 --> 00:59:57,120
their own profit loss and
balance sheet to make sure that

982
00:59:57,120 --> 01:00:01,840
at every step of the chain
there's at least break even.

983
01:00:02,680 --> 01:00:06,400
And at every step of the chain
you have your own imbalances in

984
01:00:06,400 --> 01:00:08,960
rare earth.
So if you try to bring that

985
01:00:08,960 --> 01:00:11,560
under one roof, you will create
one big mess.

986
01:00:12,120 --> 01:00:14,880
Keep it separate.
One specialist, one specialist,

987
01:00:14,880 --> 01:00:20,800
11 specialist do not force you
junior miners to to produce

988
01:00:20,800 --> 01:00:22,800
something they have no clue
about.

989
01:00:23,440 --> 01:00:25,440
It's not fair.
Mine to magnet.

990
01:00:26,120 --> 01:00:27,680
The.
Admission of the junior miner

991
01:00:27,760 --> 01:00:31,760
isn't even a miner yet.
But that's that's super special

992
01:00:31,760 --> 01:00:34,640
retard.
In that case, that's like, yeah,

993
01:00:34,760 --> 01:00:37,040
oxides is one thing, metal, then
the magnets.

994
01:00:37,040 --> 01:00:41,680
No, that's that's Brian dead.
So this this is like a

995
01:00:42,200 --> 01:00:47,200
pregnancy, you know, at the
beginning, in months 1 you, you

996
01:00:47,200 --> 01:00:52,720
produce some ore and probably
nine months later, you know, you

997
01:00:52,720 --> 01:00:56,080
will finally produce some
marketable product in form of a

998
01:00:56,080 --> 01:00:58,680
separated material.
Not good.

999
01:00:58,760 --> 01:01:00,960
And I think that's unfair
because it also drives the

1000
01:01:00,960 --> 01:01:03,360
capital requirements through the
roof and all that.

1001
01:01:03,400 --> 01:01:06,080
The approach of U core is
actually quite OK.

1002
01:01:06,520 --> 01:01:09,400
Unfortunately, they have a
process there which probably

1003
01:01:09,400 --> 01:01:12,960
doesn't work because, I mean,
the masters of grand, the grand

1004
01:01:12,960 --> 01:01:15,800
masters of rare earths and China
have given up on a similar

1005
01:01:15,800 --> 01:01:19,880
process already in 2011.
But this is actually the correct

1006
01:01:19,880 --> 01:01:22,800
approach.
And some private companies,

1007
01:01:22,880 --> 01:01:27,160
particularly in the US and
Europe, who also say, no, no,

1008
01:01:27,160 --> 01:01:30,520
no, we don't do any mining.
We do the separation.

1009
01:01:30,520 --> 01:01:34,680
That's our job.
And then LCM come in, metal

1010
01:01:34,680 --> 01:01:39,040
maker, metal expert, nobody will
challenge them because they are

1011
01:01:39,040 --> 01:01:40,640
the guys who know how to do
this.

1012
01:01:40,920 --> 01:01:43,480
Yeah.
And the same goes further

1013
01:01:43,480 --> 01:01:46,640
downstream than, for example,
for the magnet makers.

1014
01:01:47,200 --> 01:01:48,640
Thomas, what are we, what are we
to make of?

1015
01:01:48,640 --> 01:01:50,600
I mean, you talked about like
why was Lana successful?

1016
01:01:50,600 --> 01:01:53,120
They had the market before the
selling.

1017
01:01:53,640 --> 01:01:56,520
We live in a time now where, you
know, a project like any other

1018
01:01:56,520 --> 01:01:59,400
is, is, is getting financed.
There's no market for that

1019
01:01:59,400 --> 01:02:01,040
product.
So now the government's coming

1020
01:02:01,040 --> 01:02:03,840
in and that will be the market.
They'll buy the product.

1021
01:02:04,160 --> 01:02:05,720
Like what?
What are we going to make of

1022
01:02:05,720 --> 01:02:06,320
that?
Like which?

1023
01:02:06,800 --> 01:02:08,840
Project.
I look as any other.

1024
01:02:08,840 --> 01:02:11,640
Oh.
Yeah.

1025
01:02:11,640 --> 01:02:14,400
OK.
Australia, my primitive view is

1026
01:02:14,760 --> 01:02:19,560
you can already not profitably
mine nickel in Australia.

1027
01:02:20,480 --> 01:02:23,520
What makes you think that will
be any better?

1028
01:02:23,880 --> 01:02:27,720
So I really think that the
capital expenditure amounts that

1029
01:02:27,920 --> 01:02:32,640
are put out there for these
projects in general are way too

1030
01:02:32,640 --> 01:02:35,560
high.
I mean even heavy mineral sense,

1031
01:02:35,560 --> 01:02:38,760
you know, the amounts are just
flabbergasting this, this

1032
01:02:38,760 --> 01:02:41,320
doesn't fly.
I think that it's more of a

1033
01:02:41,360 --> 01:02:44,200
general problem in Australia.
Yeah.

1034
01:02:44,440 --> 01:02:49,000
And $2 billion for the
separation of Monazite is?

1035
01:02:49,800 --> 01:02:52,320
If we're lucky.
Brilliant dollars, of course,

1036
01:02:52,320 --> 01:02:55,800
but this is It's too much.
It cannot.

1037
01:02:55,800 --> 01:03:01,400
It cannot be cannot work.
What do you make of the current

1038
01:03:01,400 --> 01:03:05,520
status of geopolitical dynamics?
With rare earth being this real

1039
01:03:06,520 --> 01:03:09,320
point of leverage?
Do we expect any change here?

1040
01:03:09,320 --> 01:03:11,640
Do we think things will ease on
any of the fronts in that

1041
01:03:11,640 --> 01:03:13,600
respect, or do you think this is
the new status quo?

1042
01:03:14,040 --> 01:03:16,400
The capacities in China are
gigantic.

1043
01:03:17,200 --> 01:03:21,360
You have basically 3 dominant
rare earth compound

1044
01:03:21,360 --> 01:03:27,400
manufacturers plus about several
dozens of independents and the

1045
01:03:28,320 --> 01:03:31,360
I, I don't want to be too
specific, but I think the, the

1046
01:03:31,360 --> 01:03:36,160
base capacity for separation in
China is 510,000 tons and then

1047
01:03:36,160 --> 01:03:41,720
you have a as permanent magnet
capacity that is above 600,000

1048
01:03:41,720 --> 01:03:45,240
tons already.
Last year the utilization rate

1049
01:03:45,280 --> 01:03:49,080
in as permanent magnets in China
was barely 60%.

1050
01:03:49,120 --> 01:03:53,080
I've done metal business for
about 20 years and in my

1051
01:03:53,080 --> 01:03:58,160
opinion, any utilization rate
below 70% and you start writing

1052
01:03:58,160 --> 01:04:00,520
losses.
You know, with this in the

1053
01:04:00,520 --> 01:04:05,560
background, I completely fail in
understanding how China wants to

1054
01:04:05,560 --> 01:04:09,360
hamper exports.
As I mentioned, last year they

1055
01:04:09,360 --> 01:04:16,480
exported 58,147 tons of rare
earths, permanent magnets to 130

1056
01:04:16,480 --> 01:04:20,640
countries.
This is an enormously dominant

1057
01:04:20,640 --> 01:04:27,080
position and now they force
practically the main players to

1058
01:04:27,120 --> 01:04:30,680
have their own supply.
Where does this leave China's

1059
01:04:30,680 --> 01:04:32,600
monopoly?
Where does this leave the

1060
01:04:32,600 --> 01:04:35,320
advances that they made?
It will all come to nothing.

1061
01:04:35,840 --> 01:04:39,160
We must hear the explosions and
we must do something.

1062
01:04:39,160 --> 01:04:43,960
So and I think in, in terms of
of EU, the idea with Solvay and

1063
01:04:43,960 --> 01:04:47,680
Carrister is nice, but we have
to address the issue of

1064
01:04:47,680 --> 01:04:52,400
processing primary raw materials
in the EU with the resulting

1065
01:04:52,400 --> 01:04:56,080
radioactive waste.
This must come onto the table.

1066
01:04:56,120 --> 01:04:58,360
This is the problem of the
origin countries.

1067
01:04:58,560 --> 01:05:00,560
You cannot do that.
This is not OK.

1068
01:05:00,840 --> 01:05:05,360
If you want to benefit from the
added value, you also have to

1069
01:05:05,360 --> 01:05:09,640
deal with the problems.
And don't forget all of them

1070
01:05:09,880 --> 01:05:15,080
signed on to the Treaty of
Nuclear Non Proliferation, the

1071
01:05:15,080 --> 01:05:17,440
NPT.
There are accession protocols

1072
01:05:17,440 --> 01:05:20,640
where there are quantities
inside which define how much

1073
01:05:20,720 --> 01:05:24,120
radioactive material you can
produce a year, and all of them

1074
01:05:24,120 --> 01:05:27,200
will exceed them.
So the IAEA would need to be

1075
01:05:27,200 --> 01:05:31,000
involved if you want to leave it
in the countries of origin.

1076
01:05:31,560 --> 01:05:36,960
So I think there we should be
more forthcoming and honest.

1077
01:05:37,640 --> 01:05:40,440
No, I totally agree there.
And I think that's a very big

1078
01:05:40,440 --> 01:05:43,880
advantage to China as China is a
country lead by engineers, by

1079
01:05:44,200 --> 01:05:47,000
smart people who see this as it
is.

1080
01:05:47,000 --> 01:05:49,120
We also tend to be very
emotional in that sense.

1081
01:05:49,120 --> 01:05:51,040
I guess radioactive is bad
stuff.

1082
01:05:51,320 --> 01:05:55,720
It is bad, but if you handle it
in a proper way, it's effects

1083
01:05:55,720 --> 01:05:57,600
can be mitigated very
efficiently.

1084
01:05:57,960 --> 01:06:00,800
And if you want to produce
anything of volume in the in the

1085
01:06:00,800 --> 01:06:02,320
West, we need to deal with this
stuff.

1086
01:06:02,320 --> 01:06:05,560
We need to deal with thorium a
place or relatively low on

1087
01:06:05,560 --> 01:06:08,240
dorium, but any hard projects
that's the best inside will be

1088
01:06:08,240 --> 01:06:10,720
high in dorium.
You can produce a relatively

1089
01:06:10,720 --> 01:06:13,120
clean dorium concentrate.
You can put it back back in the

1090
01:06:13,120 --> 01:06:14,520
pit.
There are multiple solutions

1091
01:06:14,520 --> 01:06:16,520
there.
We need to address this if you

1092
01:06:16,520 --> 01:06:18,920
want to make have a chance as a
Western supply chain.

1093
01:06:19,800 --> 01:06:24,160
I think for me Axel's being a
bit dismissive of the sector in

1094
01:06:24,160 --> 01:06:25,760
terms of its ability to generate
cash.

1095
01:06:25,760 --> 01:06:31,320
In my mind it's very simple for
us to over simplify what's going

1096
01:06:31,320 --> 01:06:33,640
on here.
If we've learned anything from

1097
01:06:33,640 --> 01:06:40,640
the last 30 years of BHP in Rio
eliminating the downstream, it's

1098
01:06:40,640 --> 01:06:44,400
always to focus on what we can
do best, focus on the upstream.

1099
01:06:46,160 --> 01:06:49,040
We're a country or in this part
of the world or probably

1100
01:06:49,040 --> 01:06:50,720
markets.
We're a digging ship economy.

1101
01:06:50,880 --> 01:06:52,880
We're still pushing product
offshore.

1102
01:06:53,720 --> 01:06:58,640
So I think to do the advanced
chemical engineering takes a

1103
01:06:58,800 --> 01:07:03,560
different set of skills and a
different set of knowledge to be

1104
01:07:03,560 --> 01:07:06,640
able to navigate how to do this
in an economic way.

1105
01:07:07,680 --> 01:07:10,480
In my mind, I'm still still find
it fascinating.

1106
01:07:10,920 --> 01:07:13,760
I still think there's a lot of
alpha to be found.

1107
01:07:14,160 --> 01:07:17,800
But understanding the chemistry
and the complexity of these flow

1108
01:07:17,800 --> 01:07:21,920
sheets and the permitting, I
think there's a lot more work

1109
01:07:21,920 --> 01:07:25,640
still to be done.
But I'm still enjoying it, and

1110
01:07:25,800 --> 01:07:28,280
particularly enjoying talking
about it with these two gents.

1111
01:07:28,760 --> 01:07:31,400
Is there any like market
activity we can anticipate just

1112
01:07:31,520 --> 01:07:36,000
like you guys have any theories
about deals in the space that

1113
01:07:36,000 --> 01:07:39,360
makes sense or likely?
Can we go back to that?

1114
01:07:40,680 --> 01:07:44,480
It was only very small news
blip, but Linus and MP possibly

1115
01:07:44,480 --> 01:07:48,000
coming together.
It's old news, but I always

1116
01:07:48,000 --> 01:07:56,320
liked the notion that if we're
going to compete with China in

1117
01:07:56,320 --> 01:08:00,640
any way, shape or form you're
doing, you're better off doing

1118
01:08:00,640 --> 01:08:05,680
this together.
Consolidating rest of world

1119
01:08:05,680 --> 01:08:10,200
supply.
I think strategically and from a

1120
01:08:10,200 --> 01:08:13,200
marketing perspective makes a
lot of sense.

1121
01:08:13,840 --> 01:08:15,920
Not that I know anything in
particular, but that's something

1122
01:08:15,920 --> 01:08:19,479
that's rattling around in the
back of my head and the ability

1123
01:08:19,479 --> 01:08:26,120
to grow in with manufacturing,
reassuring, reassuring going on.

1124
01:08:27,200 --> 01:08:30,279
I think that opens up several
possibilities.

1125
01:08:31,920 --> 01:08:35,240
So in my mind, that's something
I'm keeping a close eye on.

1126
01:08:36,160 --> 01:08:41,120
I'm also keeping an eye on
what's happening with Ilooka in

1127
01:08:41,120 --> 01:08:45,520
terms of third party feedstock.
That's something that continues

1128
01:08:45,520 --> 01:08:49,080
to burn in the back of my mind
and what opportunities that may

1129
01:08:49,080 --> 01:08:54,120
open up, whether it's for an
NTU, there's some development

1130
01:08:54,120 --> 01:08:57,399
company or development projects
that look pretty good on face

1131
01:08:57,399 --> 01:09:00,040
value that might be coming in
into the space.

1132
01:09:01,760 --> 01:09:04,359
We still need to see how they're
going to get a price that's

1133
01:09:04,399 --> 01:09:08,920
going to justify the investment.
So coming back to that point

1134
01:09:08,920 --> 01:09:11,640
around price bifurcation, which
I think is a bit of a fantasy,

1135
01:09:12,479 --> 01:09:15,560
maybe we do not need to start
seeing what we what happened in

1136
01:09:15,560 --> 01:09:19,720
the US, whereby correct me if
I'm wrong here, Thomas, but

1137
01:09:19,720 --> 01:09:23,560
there was some sort of domestic
incentive price or floor price

1138
01:09:23,560 --> 01:09:27,920
given to US producers of a
domestically manufactured magnet

1139
01:09:28,600 --> 01:09:33,040
was a $25 or $30.00 US relative
to the Chinese price at the

1140
01:09:33,040 --> 01:09:36,840
time, which was something around
20.

1141
01:09:38,000 --> 01:09:42,560
If you produce it in the US,
there's a $5, there's a $5 head

1142
01:09:42,560 --> 01:09:45,720
start.
That type of mechanism I thought

1143
01:09:45,720 --> 01:09:50,840
was really interesting and might
lead the way in terms of getting

1144
01:09:50,840 --> 01:09:53,279
us to figure this out on the
downstream economic side of

1145
01:09:53,279 --> 01:09:57,040
things, how this should work and
also free open checkbook from

1146
01:09:57,440 --> 01:09:59,320
the Australian government or the
US also helps.

1147
01:09:59,840 --> 01:10:01,600
Excellent guys.
Thank you so much for sharing

1148
01:10:01,600 --> 01:10:04,680
your insights.
This has been just awesome.

1149
01:10:04,960 --> 01:10:08,520
Truly grateful for the shared
expertise of the three of you.

1150
01:10:08,560 --> 01:10:11,280
It's been an absolute delight.
So thanks so much guys.

1151
01:10:11,280 --> 01:10:13,400
Cheers.
Yes, thank.

1152
01:10:15,560 --> 01:10:17,040
You thanks.
How good was that?

1153
01:10:17,040 --> 01:10:19,400
I think we've got some partners
to thank after that absolutely

1154
01:10:19,520 --> 01:10:21,880
ripping conversation, JD.
Hi, after that ripping

1155
01:10:21,880 --> 01:10:23,920
conversation, we've got some
ripping partners to thank.

1156
01:10:24,000 --> 01:10:26,000
A big thank you to Mineral
Mining Services.

1157
01:10:26,000 --> 01:10:29,240
Grounded Sandy Ground Support
Cage drill cross Boundary Energy

1158
01:10:29,240 --> 01:10:30,440
Go.
To Roke, go to Roke.

1159
01:10:31,720 --> 01:10:34,560
Now remember, I'm an idiot.
JD is an idiot.

1160
01:10:34,880 --> 01:10:36,960
If you thought any of this was
anything other than

1161
01:10:36,960 --> 01:10:39,680
entertainment, you're an idiot
and you need to read out a

1162
01:10:39,680 --> 01:10:40,160
disclaimer.