For Tasmanian rare-earths hopeful ABx Group (ASX:ABX), the ability to extract the coveted material economically is just as important as having a well-located deposit with the right size and grade in the first place.
At its multiple prospects near Launceston, the ASX-listed ABx is confident of ticking all the requisite boxes, after third-party testing confirmed the key rare earth elements could be recovered from the ionic adsorption clay (IAC) material.
The tests were undertaken by the Australian Nuclear Science and Technology Organisation (ANSTO), emulating real-life recovery conditions.
ABx chief executive Dr Mark Cooksey says the tests achieved the highest extractions of any reported in Australia.
“With a copper resource you have a good idea whether it will fly or not, based on size and grade,” he says.
“But with clay-based rare earth situations, it appears that only a small number have the right mineralogy.”
Relative to traditional hard-rock sources, a key benefit of an IAC-type deposit is that the rare earths are only loosely attached to the clay particles, so can be separated with a salt solution. This negates the need for acid treatment and lowers costs significantly.
Cooksey says that 80-90 per cent of the value of the rare earths market derives from permanent magnet rare earths: terbium, dysprosium, praseodymium, and neodymium.
While the latter two are present in hard-rock deposits, only clay deposits are well endowed with terbium and dysprosium: so-called super-magnet rare earths used in electric vehicles (EVs) and wind turbines.
Terbium is also used in low energy light bulbs and medical X-rays, while dysprosium is used in medical reactors. As a sign of just how valuable these materials are, terbium fetches just under $US4 million ($5.7m) a tonne, while dysprosium trades for more than $US800,000/t.
A key factor in this pricing strength is that China currently dominates production of ionic rare earths – and rare earths generally – notably from its Bayan Obo mine in inner Mongolia.
While the picture is opaque, Chinese output appears to be declining because of environmental concerns and Beijing’s desire to focus on downstream uses.
With an initial focus on bauxite, ABx discovered the rare earths potential of its Tasmanian ground after its geologists correctly surmised that rare earths occurred in the same structures as the aluminium ingredient (also prolific in the tenements).
Released last November, the maiden resource covered the Deep Leads and Rubble Mound prospects. The estimate outlined 3.94 million tonnes, containing total rare earth oxide (TREO) content of 918 parts per million (ppm).
Management believes the more meaningful number is the 655 ppm of TREO less the content of cerium, a low-valuable rare earth that has low extraction during desorption.
ANSTO’s recent desorption tests covered 71 samples from the company’s Deep Leads and Rubble Mounds deposits. Carried out at ANSTO’s Lucas Heights facility in Sydney, the assays emulated the low-acid, low-cost processing conditions for IAC rare-earth elements (REEs).
(Despite ANSTO’s involvement, the material is not radioactive).
From the 44 samples in the IAC zones in the maiden resource, REE extractions ranged from 24-83 per cent.
In the case of the more closely-drilled Deep Leads, extraction rates for 36 of the 49 samples averaged 50 per cent with a minimum 24 per cent.
Cooksey says the results were in line with the extraction rates of the long-producing Chinese mines.
“We don’t quite know what the economics will be until we have done further analysis, but this shows the deposit is in the ballpark,” he says.
Cooksey says the company’s focus now turns to further drilling and metallurgical work, as well as some deep thinking about the size and nature of a processing facility.
On the latter, the company will seek input from ANSTO and other parties. One likely option is to produce a mixed concentrate containing all of the rare-earth elements – similar to an existing intermediate product used by refineries.
“We have to be clear about how far down the processing chain we want to go,” he says.
“We could sell to a refinery rather than building the whole value chain. In any event, we are talking to customers to ensure we have a path to market for our product.”
In mid January, the company kicked doff a120-hole reverse circulation drilling blitz, aimed at extending the mineralisation zone between the Deep Leads and Rubble Mound discoveries.
While earlier drilling was stymied because of wet winter conditions, a dry spell has enhanced rig access.
Cooksey notes the declared resource only covered 7-8 per cent of ABx’s entire project area. “There is plenty of scope to expand the resource but we need to do more drilling,” he says.
Cooksey says there a lot more work to do more broadly, including a prefeasibility study to hone the scope and cost of the project.
But he believes ANSTO’s assurances have swung the odds in the company’s favour at a time of deepening supply deficit.
“While there’s debate about exact demand, there’s not enough dysprosium and terbium in the world at the moment,” he says.
“There are significant opportunities for new suppliers.”
Image & Story Credit: finnewsnetwork.com.au