Mountain Pass, California is the site of an open-pit mine that is reportedly the richest in the world in “rare earth” metals. Rare earth metals are used to make permanent magnets for the engines in hybrid vehicles as well as for the generators used in wind turbines so Molycorp Minerals LLC plans to reopen the 55 acre mine, which has been unused for years.
China was once the leader in supplying the world with rare earth metals, but is cutting exportation of them to feed the appetite of its own industries. In fact, Molycorp was undercut so severely by China in the 1990s that Mountain Pass was closed.
However, global demand for the rare metals is rising sharply along with the worldwide demand for green energy and eco-friendly cars, and Molycorp (which was sold last year to a private group of investors) has a plan to claim a large part of the market.
The rare earth metals are used in the production of many kinds of electronic goods. Some gadgets use tiny amounts, while other goods use much more. Toyota’s Prius, which now enjoys top sales status in the hybrid car market, uses about 2.2 lbs of a mined substance called neodymium, which is the main ingredient in permanent magnets. Each Prius also requires 22-33 lbs of lanthanum, which is another rare earth metal.
Rare metals expert Jack Lifton said that the Prius is “the biggest user of rare earths of any object in the world.”
In order to take advantage of the current rising demand and future need for rare earths, Molycorp has come up with a thirty-year plan for mining that was approved back in 2004. They have also improved mining processes to make them more efficient and successful than they have been in the past.
“The world has been looking for an alternative to these rare-earth permanent magnets for over 20 years, and one has not been found,” Molycorp chief executive Mark Smith said. “What Molycorp is proposing as a business strategy is to fill that supply chain and go all the way from mining to magnets.”
Partnering with Molycorp in making permanent magnets from the mined metals will be Arnold Magnetic Technologies Corporation of Rochester, New York. A partnership agreement was made between the two companies this past July and the project is being heavily invested in by equity investors such as Goldman Sachs.
The plan is for Mountain Pass mining to be up and running in about two years at a rate of 1,000 tons of ore per day, with further plans to double that amount in the future. In the meantime, millions of gallons of water that currently fills the bottom of the mine along with surface rock need to be cleaned up and removed.
With newer, more efficient mining techniques, Molycorp believes that it could become the world leader in rare earth metal mining once again, but they are not alone in their plans to mine the highly sought after substances. Canadian and Australian companies are also attempting to develop their rare earth metal deposits and claim a share of this lucrative industry.