California Rare-Earth Mine Reopens 244
burnin1965 writes in to let us know that the looming crisis in rare-earth materials (which we have discussed recently) has prompted Molycorp, the erstwhile operator of a California mine closed in 2002, to announce plans to reopen it.
"With increasing prices on rare earth ore, tariffs raised by the Chinese government, and the threat of embargoes that would damage United States high-tech manufacturing Molycorp now has the needed incentive to reopen the California Mountain Pass mine. They will spend the capital needed to implement badly needed updates to environmental controls that will mitigate the radioactive waste water releases that plagued the mine in the past. Chinese imports in the 90s nearly halved ore prices and the California mine experienced multiple failures in environmental controls that resulted in the release of huge volumes of radioactive waste water. Updating the mine to address the environmental issues was not financially viable due to the cheap Chinese imports so it was closed in 2002." Within two years the mine could be producing 20% of the amount of rare earths we import from China.
Molycorp's production is going straight to Japan (Score:5, Interesting)
Despite the story's GO AMERICA slant, a lot of material is going straight to Japan, where most of it is consumed in the first place. Like to Hitachi: http://www.reuters.com/article/idUSTRE6BK5PL20101221 [reuters.com]
Oh look. They also signed deals with Sumitomo and Mitsubishi: http://www.yomiuri.co.jp/dy/business/T101219002181.htm [yomiuri.co.jp]
They got huge piles of cash from Sumitomo, Mitsubishi, and Hitachi...which is why it's hilarious to hear the CEO of Molycorp waving American flags in various quotes. Oh, and Molycorp's stock has shot up since their IPO in July: http://www.businessweek.com/news/2010-07-28/molycorp-s-ipo-aims-at-chinese-grip-on-smart-bombs.html [businessweek.com]
Also, how interesting that the EPA announces cleanup plan of Molycorp site just a few days ago: http://abcnews.go.com/Business/wireStory?id=12460111 [go.com]
The EPA said contaminated material from the Molycorp site includes about 328 million tons of acid-generating waste rock, more than 100 million tons of tailings and acid-rock drainage at the mine and seepage at the tailings facility.
Anyone want to place bets on whether or not the US government will press environmental regulations on Molycorp this time, now that national security interests are involved?
Bad (Score:5, Interesting)
I think the US should sit on this resource for now. China only has 37% of the world's proven reserves of rare-earth minerals, but they are fulfilling 97% of the world's demand. Let them burn through their easily harvested natural supplies, so a decade from now they will be reliant on other countries for a critical resource. This could provide one of the few checks and balances for dealing with China as a communist super-power.
another group of scam artists (Score:2, Interesting)
There are only a few principals in Molycorp, each with millions in salaries plus bonuses. They managed to lose over 80 million USD on 22 million USD in equity in just three short years. They hired a couple firms to shake the fear lobby public relations/news tree. The Japan-China rare earth thing occurs regularly every couple of years, and this incident is no different. You may find in the next SEC filing that the principals have unloaded significant paper dilution in the latest round of scamming. I expect they will close again once the stock sale scamming has peaked.
Re:Old news (Score:4, Interesting)
Coordinates of the Chinese mine are 41.797846,109.976892 if you are interested in looking it up on Google Earth or similar. Hard to judge the size of the mine directly, but the sprawling piles of tailings are pretty impressive (the rampant nasty-looking runoff less so).
For comparison, the Mountain Pass mine in California appears to be at 35.47903,-115.535796 (literally just off I-15 between LA and Las Vegas).
Re:Good! (Score:2, Interesting)
Actually, it is a bit of an engineering problem too.
You see, it's not that the pipes couldn't be upgraded, it's that if the pipes were in place before regulations changed, then upgrading or doing anything besides bringing them back to whatever the grandfathered spec is, could trigger a crap load of other requirements to be met without touching the pipes too.
This is particularly problematic for electrical generations facilities. An attempt to put misters in the exhaust plumes of one coal burning facility to catch more fly-ash and introduce some reagent in the process supposedly to make the exhaust cleaner ended up being sidelined because they would have been forced to re-engineer the entire plant to meet 2003 regulations when the plant was built in 1955. Since then, there has been approval to use plain water to catch fly-ash but they couldn't use any chemicals without losing their grandfather status on the regulation.
So fixing things back to the way they were instead of fixing things to be better seems to be the way to avoid unnecessary costs in this regulation swapping world.
And yes, that would be an unnecessary cost. If the pollution wasn't a problem when the plant was built and put into operation, then even though it's seen as a problem today, shouldn't effect that operation.