TORONTO (miningweekly.com) – Tasman Metals, which owns the Norra Kärr rare-earth project in Sweden, plans to list on the Amex in the next two or three months, and will start talking to potential partners to fund and build a processing plant at the project in mid-2012, CEO Mark Saxon said on Thursday.
“Building rare earths plants is tough. Companies like ours need a technology partner...I think that’s very natural in the rare earth elements industry,” Saxon said in an interview with Mining Weekly Online.
TSX V-listed Tasman this week said it had made progress on metallurgical processing research at the Norra Kärr project, recovering more than 90% of the rare earth elements taken from drill samples by applying a pre-leach at room temperature, followed by an acid roast and leach.
Saxon said that these positive results could help the company to accelerate the development of the project, which the company has said it aimed to bring into production in 2016.
Earlier on Thursday, Goldman Sachs released a research report that predicted that prices of the elements, used in consumer electronics, electric vehicles and smart bombs, would likely continue to climb this year and the next, as demand outstrips supply, but that there could be an oversupply by 2013.
China produces over 95% of the world’s rare earths, and the country has been cutting exports and production in an attempt to improve the industry’s environmental record.
Saxon said there may be an oversupply of light rare earths in 2013, by which time US-based MolyCorp and Australia’s Lynas Corp will have their mines in full production, but that this wasn’t the case for heavy rare earths.
“There will be no heavy rare earth producers in the western world in 2013. I have a lot more confidence in heavy rare earths,” he commented.
Norra Kärr has one of the highest ratios of heavy rare earths out of the juniors rushing to bring their projects into production to take advantage of soaring prices.
TSX-listed Avalon Rare Metals also has a heavy rare earths project in Canada, as does Quest Rare Minerals.
While Saxon conceded that Tasman was “a little bit behind” these companies on the development curve, he was quick to point out that Sweden is a “very efficient country” to operate in.
He also noted that there are insignificant levels of radioactive uranium and thorium at Norra Kärr, which has caused problems for other companies, including Lynas.
Lynas has run into community opposition and regulatory delays for the processing plant it aims to operate in Malaysia because of concerns around the radioactive waste material it is left with after having extracted the rare earth elements.
“We’re in a very good position there,” said Saxon.
He said that Tasman would likely partner with a European rare earths processor to build the plant at Norra Kärr, of which there were less than a dozen.
An alternative would be to partner with a company that produces light rare earths and wants access to the heavy rare earths too, Saxon added.
Tasman would be keen on bringing in a partner to build and pay for the plant, while it focused on the mining side.
The company aimed on publishing a scoping study on Norra Kärr in about three months, which would include a preliminary economic assessment, with a prefeasibility study due for the second half of next year.
Tasman has a market value of C$286-million, after its shares slipped 8% in Thursdays commodities sell-off to trade at C$4,95.