Feb. 14 – Mitsui & Co. and Sumitomo Corp. may invest in Siberian rare earth deposits, Sakha Yakutia Republic Governor Yegor Borisov said to reporters.
Japan´s second and third-biggest trading companies have held talks with regional officials about niobium and scandium resources in Yakutia, an area of northeastern Russia roughly the size of India.
In November, the Sakha Republic delegation headed by Yegor Borisov paid a visit to the Japanese business community and government officials, presenting the unique mining opportunities of the region, including rare earths.
Prices for rare earths have soared since July 2010, when PRC cut second-half export quotas by more than 70 percent, and stopped exports of rare earth elements to Japan over a boundary dispute involving a Chinese fishing-boat captain and a Japanese Navy patrol boat.
“South Korea and Japan have begun to go hungry,” Borisov said in the Ural Mountains’ city of Ufa, where he attended a meeting with President Dmitry Medvedev last Friday.
“Now there’s good reason to reconsider our position on rare-earth deposits in Sakha that were scheduled for development after 2030,” he added.
With China continuing to restrict exports, Borisov said he’s in talks with the Federal Subsoil Resource Use Agency about starting auctions for deposits as early as 2014.
The Sakha Republic’s Tomtorsky Deposit, which contains 12 percent of the country’s rare earth reserves, is considered as the most likely site for Japanese investment.
China produces 97 percent of the world’s rare earths, but it contains only 30 percent of the world’s supply. The U.S. Geological Survey (USGS) puts total global reserves at 99 million metric tons; China hosts some 36 million of them.
Russia has the largest reserves of commercially viable rare earths after China – 19 million metric tons – while U.S. reserves are estimated at 13 million metric tons.
The rare earths, a group of 17 atomic elements mined from Earth’s crust, are among a unique group of chemical elements vital to making many high and low-tech gadgets – from iPhones, hybrid cars, lasers, and engines to oncological applications and night-vision devices.
Such elements also are deemed essential to fielding a new generation of green-energy technologies like wind turbines and solar devices.
Despite the name, a throwback to their initial discovery, these elements are as abundant as tin or nickel. But they are tough to mine and extract.
Although the United States, Australia and other countries served as major sources for rare earth minerals for 50 years, China’s low labor costs and environmental lax rules allow it to produce both raw and refined minerals at much lower costs than elsewhere.
Global consumption of rare earths last year was about 124,000 tons, 10,000 tons less than production, a difference covered by stockpiles, the U.S. Congressional Research Service said in a Sept. 30, 2010, report. Demand will probably reach 180,000 tons next year.
Undiscovered global deposits are thought to be enough to meet anticipated future demand, according to the USGS. The issue is whether new mines can be online in time to meet an expected 40,000-ton annual shortfall in supply over the next five years.