Two Canadian companies aim to compete with China’s monopoly in the rare earth metals market

The plan is to make Saskatoon a key link in the global rare earth supply chain

SASKATOON—Most people use rare earth elements every day, even though they may only have a vague idea of ​​what these metals are.

Rare earth elements are the building blocks of many technologies and are valued for their magnetic and catalytic properties. They “permeate” our lives, according to David Connelly, vice president of strategy and corporate affairs at Vital Metals, which owns Canada’s first and only rare earths mine, located in the Northwest Territories.

“This is extremely important, given that the world depends on a supply chain where up to 90 percent of rare earths are mined or processed in China,” Connelly told The Epoch Times.

“Whether it’s a wind turbine or an electric vehicle, an LED light bulb, a computer or a cell phone – name 100 elements – they all use rare earths, and they can’t not work or would work much less effectively without them.”

Vital Metals is building a $20 million rare earth mining facility in Saskatoon to process the metals it mines, with plans to sell the mixed rare earth carbonate produced to other companies in Europe and the United States. United for separation and further processing.

Mike Crabtree, president and CEO of the Saskatchewan Research Council (SRC), also sees significant potential in rare earths.

“It’s the phones, its cars, it’s the satellites. It will be as important to the 21st century economy as oil and gas were to the 19th and 20th centuries,” he said in an interview.

SRC is building a $55 million rare earth processing facility in Saskatoon, virtually adjacent to the Vital Metals plant. The SRC plant will include processing, separation and metal treatment stages, the first of its kind in North America. Both are expected to be fully operational in 2024.

Various rare earth oxides. (Saskatchewan Research Council)

Rare earths have been produced for decades, but China has cornered much of the global market. Thus, various countries, including Canada, are trying to develop their own supplies. The need has increased in recent years due to the push towards a greener economy.

“The difference has been the march to net zero, the march to energy transition,” Crabtree said. “So it’s wind turbines, electric vehicles, the larger scale use of these rare earths for this energy transition that’s turbocharged the whole market for this.”

Connelly says the growing demand is a major challenge.

“The world is going to struggle to keep up with the demand generated or required,” he said. “Many developed and developing countries have set deadlines … for the adoption of electric vehicles and also the decarbonization of their energy networks. … It is very difficult to see how this demand can be satisfied.

The only other rare earth mine in North America is the Mountain Pass mine in California.

Chinese domination of rare earths

In June 2021, the Standing Committee on Natural Resources presented a report to the House of Commons noting that, given the demand for rare earth metals and China’s dominance in the field, it is important for Canada to develop the sector.

One of the committee’s recommendations was that the federal government “renew its support for the Canadian mining sector so that it can take advantage of the many opportunities presented by the development of critical minerals and recognize their unique contribution to advanced technologies and the energy transition”. “.

According to Mining.com, China controls more than 80% of mined cobalt and more than 85% of refined cobalt for electric vehicle batteries, having acquired strategic mining assets around the world in recent decades. It controls 100% of the world’s production of spherical graphite, an essential component of electric vehicles.

Vital Metals began production at its Nechalacho project in the Northwest Territories in 2021. Operated by a subsidiary called Cheetah Resources, the company’s goal is to be the lowest-cost rare earth producer outside of China.

Connolly said the company hopes to start production from its larger nearby Tardiff field within a few years.

“This deposit should be able to supply a significant percentage of the world’s rare earths that do not come from China,” he said.

In light of China’s monopoly in the rare earth market, the US government has taken steps to establish a national supply chain for rare earths and other minerals critical to battery manufacturing.

Epoch Times Photo
NdPr metal alloy block produced by the Saskatchewan Research Council. (Doug Lett/The Epoch Times)

Making Saskatoon a North American Hub

Vital Metals said the plan is to make Saskatoon a key link in the global rare earth supply chain, making the city a North American hub for rare earth element processing and research.

Last month, a rare earth elements summit was held in Saskatoon and generated a lot of interest.

“In the audience, there were two rare earths separation companies that were clearly evaluating Saskatchewan as a location for a rare earths separation facility,” Connelly said.

He believes Saskatchewan has a lot of advantages, including a strong workforce, good training facilities and relatively low costs.

However, even if the potential is there, no one claims that it will be easy. Crabtree says China has a significant advantage and a big head start over the rest of the world.

“The Chinese have invested long and hard in developing their position,” he said. “It’s going to take time and investment to build a competitive position in this regard.”

But Crabtree and Connolly believe one of the benefits is the environmental stewardship involved. The SRC plant, for example, will recycle all the water and chemicals it uses.

“The public will not tolerate driving electric vehicles where there has been significant environmental damage or where there has been inappropriate use of labor,” Crabtree said.

And Connelly highlights the environmental record and Indigenous partnership at the Nechalacho project. Approximately 70% of the mine’s employees are Aboriginal and the company has a close working relationship with the Yellowknives Dene First Nation. He notes that no water or chemicals are used in mining and no toxic residue is produced.

“There are relatively few rare earth deposits as benign and environmentally friendly to mine as the Nechalacho project,” he said.

So while there’s still a long way to go, both men believe the developing industry has huge potential.

“To have established the only rare earth chain in Canada and North America – and indeed the world – that is absolutely independent of China or Russia and that runs only through friends and allies, is a very significant achievement for Saskatchewan and the Northwest Territories,” said Connolly.

Doug Lett

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Doug Lett is a Saskatoon-based journalist. He has worked for a number of media outlets throughout his career, including CTV and Global News, where he held various news positions.