Thursday, October 11, 2012

Top 50 People To Follow In Strategic Minerals

Based on qualitative and quantitative analysis of Twitter users discussing critical and strategic minerals, it is likely that the 50 users listed are best to follow to keep up with developments in the field.

Methods and Processes:

Graduate students from the Collaborative Intelligence course in Mercyhurst University’s Applied Intelligence Program conducted this analysis. Students determined a network of Twitter users through their research related to the business, law enforcement, and national security implications of critical and strategic minerals. From this large network, the students used social network analysis and the ORA software to isolate the most connected users. This resulted in an initial list of 67 users. From there the class collectively researched the number of followers and membership on lists of each user, and determined the ratio of lists to followers, represented in the spreadsheet as a percentage.

Wednesday, October 10, 2012

International Market And Political Issues Likely To Diminish U.S. Ability To Obtain Strategic Minerals

Analytic Question:

What implications will international issues related to critical minerals have on U.S. national security in the next three to five years?

Key Findings:

Over the next three to five years, international issues including market and political conditions are likely to diminish the United States’ ability to obtain strategic minerals.

  • It is highly likely that the Chinese government will continue to bring attention to disputed regions like the Senkaku Islands, the Paracel Islands, and the Spratly Islands in the next 12 to 24 months.

  • It is likely that the national South African mining strikes will continue to affect global supply of minerals.

  • It is likely the United States will implement more regulations to diminish the quantity of central African conflict minerals being trafficked into the world market in the next three to five years.  

  • It is highly unlikely that the United States will exploit the Arctic region to reduce its dependency on other nations for strategic minerals over the next three to five years, despite abundant reserves in the region.

Increased Legislation And Cooperation Between Public And Private Sectors Likely Needed To Curtail Metal Theft In The Next 1-2 Years

Analytic Question: 
What measures could be taken to reduce the frequency of metal theft cases in the United States in the next one to two years?

Key Findings:
Due to an increasing amount of metal theft fueled by rising metal prices, it is likely that law enforcement across the United States will take action to reduce the problem by enacting laws which grant more power to law enforcement agencies and prosecutors, while increasing regulations on scrap yards. Improved legislation and powers granted to law enforcement, combined with education and cooperation with businesses and the public, will likely curtail the overall amount of metal theft. However, it is unlikely to solve the issue, as the practice will likely move underground to an increasingly organized black market, localized in metal theft rings.
  • Due to the lack of a federal law designed to combat metal theft and regulate scrap yards, it is likely that enacting a federal law would reduce the amount of metal theft taking place in the United States in the next one to two years. The Metal Theft Prevention Act, proposed by Senator Charles Schumer (D-NY), would likely help resolve many of the problems dealing with the theft of metal within the United States. States would likely build upon this law, as metal theft and scrap yard regulation vary greatly state by state.
  • Due to the high profits and low risk of being caught, it is likely that metal thefts will persist over the next one to two years, mostly in the form of metal theft rings. While new legislation and more power granted to law enforcement will likely deter many, it is unlikely that these actions alone will completely resolve the metal theft epidemic in the next one to two years.
  • In spite of the recent influx of metal thefts, local and state law enforcement agencies are likely to reduce the number of metal thefts over the next one to two years through educating the public on preventative measures and working closely with local recyclers and scrap yards to catch those trying to sell stolen metals. Companies are likely to increase the risk of the crime thus reducing total number of thefts by utilizing simple deterrent techniques such as refusing cash payments for sold metal and by collaborating with local police with theft alert websites like  

Abbreviated Dissents - There are no dissents over any aspect of this report.

Link to full document: Metal Theft Report

Mineral And Mining Legislation Highly Likely To Hamper US Business

Analytic Question:

How will mineral and mining legislation affect United States businesses in the next three to five years?

Overall Finding:

It is highly likely that mineral and mining legislation will hamper the US business sector over the next three to five years.

Key Findings:
  • Re-opening dormant mines will likely remain the most attractive method to procure strategic minerals domestically
    • Mining industry must adhere to over 80 laws through 20 agencies
    • Opening mines in the US takes, on average, seven years
  • It is likely that the effects of the Dodd-Franks bill on conflict minerals will be far-reaching, across many industries. 
    • Dodd-Franks legislation creates a competitive disadvantage for US public industries
    • US industries could incur between USD 3 and 4 billion in implementing Dodd-Franks legislation
  • It is likely that passage of US Congressional bills relating to strategic and rare earth minerals would improve the job market; however it is unlikely legislation will be implemented
    • Only 29 percent of bills sent to the floor for a vote pass both the US Senate and Congress
    • Ten strategic mineral-related bills have been introduced to the 112th Congress
  • In spite of growing non-Chinese supply of minerals, US businesses are likely to remain heavily dependent on Chinese rare-earth sources.
    • A number of strategic minerals, including Rare Earths, are 100 percent imported
    • China supplies 79 percent of the rare earths used by US industries, increasing trade tensions
Mineral and Mining Legislation Highly Likely to Hamper US Businesses

Saturday, October 6, 2012

Rare Earth Plant Delayed Again

Save Malaysia Stop Lynas are the primary activist group
attempting to stop production of rare earths in Malaysia.
KUALA LUMPER, MALAYSIA (NY TIMES) -- A court in Malaysia has delayed the license for Lynas Corp to begin production at a controversial rare earth plant. A decision will be made on October 10th on whether production will be blocked permanently.
The plant is built and ready to go, but production has been delayed due to environmental and safety disputes. It is one of the biggest plant of its kind outside of China and has faced resistance since construction started two years ago.
In order to break China's grip on rare earths supply, plants such as these, need to be built and producing in order to compete. The current delay is based on safety concerns, however, activists are reviewing whether the government has the right to allow the plant to operate. 'Save Malaysia Stop Lynas' has its work cut out as it tries to prevent Lynas corp from starting production at a plant valued well over $800 million.
Source: Malaysian Court Delays Rare Earth Plant (Reliability: High)

Comment: US businesses will be hoping that Lynas corp wins this battle with activists and those wishing to see their license to mine revoked. If China's stranglehold on rare earths and minerals continues, they will control supply and prices of these components that are attributed to technology products, cars and many other industries in the US.

Friday, October 5, 2012

N.C. Scrap Metal Buyer Permitting Law Goes Into Effect 1 October 2012

The act aims to cut down on theft by adding to the
paper trail for the sale of scrap metal; N.C. now has
a cap on cash purchase of metal at 100 USD
KINSTON, NC (FREE PRESS & JONES POST) --In order to address the steady increase in the theft of scrap metals, especially copper, the North Carolina General Assembly recently passed House Bill 199, the Metal Theft Prevention Act. On 1 October, the Act went into law. Now, any business involved in the purchase and recycling of metals must apply to the local sheriff’s office for a permit to be in compliance with the act. The permits are available free of charge and are valid for 12 months at “fixed sites in the county of issuance,” according to the LCSO. The law applies to purchasers of ferrous and nonferrous metals. Nonferrous metals such as copper, aluminum not used in cans and stainless-steel beer kegs do not have large amounts of iron and steel in them.The law also limits cash payments for metals — buyers of nonferrous metals cannot pay cash for copper, and any purchase of other nonferrous metals worth more than $100 must be paid by either check, cash card or money order. “A nonferrous metals purchaser shall not make more than one cash purchase per day from any individual, business, corporation or partnership,” the law states. Scrap yards already had to keep detailed records of customers who brought them scrap metal,  even taking their fingerprints if they brought in catalytic converters, air conditioning condensers or evaporator coils, but the new law also requires them to obtain a permit from the sheriff’s office and get a photo or video of the seller with the materials. Source: New Metal Theft Law Takes Effect Today (Reliability: High)

Comment: This is just one example of the legislature taking action against the increases in copper theft in the US. Law enforcement is attempting to take proactive steps to address these thefts. The permitting process in North Carolina and increased paper trail will likely discourage large-scale theft of copper in the state.

Dodd-Frank Wording Creates Unfairness Amongst Competitors

General Motors must comply with section 1502 of the
Dodd-Frank Act, but competitors like Volkswagen AG
and Daimler AG do not, creating unfairness in the market.
NEW YORK (WSJ) -- The Security Exchange Commission (SEC) recently adopted section 1502 of the Dodd-Frank Act, which requires companies that meet certain criteria to publish if conflict minerals are used in any part of the supply chain for the company. These minerals come from the Congo and surrounding areas, and the proceeds are used to fuel wars and other conflict in the region. Industries impacted by section 1502 include automobile, jewelry, electronics, aerospace, and others. These industries stated that the section will add to costs and is difficult to comply with, as their whole supply chain will have to be audited and new minerals will have to be sourced if it is found that conflict minerals are used. However, even if a company does not have to comply with section 1502, there is a growing movement of corporate responsibility, in which many businesses are removing conflict minerals from their supply chains in order to maintain a favorable reputation. Source: Nuances in Conflict Minerals Rules Creates Uneven Playing Field. (Reliability: High)

Comment: Section 1502 was created to cut off funding to warlords in and around the Congo. It will be years before an assessment can be made to determine if the rule had the desired outcome.

US Far Behind in Race for Arctic Assets

The United States is not look at the Arctic as an investment
BARROW, ALASKA (GLOBALPOST) - The melting of the Arctic has opened up the potential to access oil and minerals beneath the floor of the Arctic Ocean.  Economists are predicting that there could be trillions of dollars in profit in the coming decades.  Alaska Lt. Governor Mead Treadwill believes the United States in not even in competition for the race for oil and minerals in the Arctic.   Despite the profits and opportunities in the Arctic, American administrators are not utilizing the Arctic's potential.  Many international observes believe the US is failing to understand the need and importance to establish itself as a leader in the Arctic.  It will take a long time for the United States to become as active as China and Russia in the Arctic.  The US Coast Guard does not have the resources for the shipping surge or oil exploration, including ice cutters.    Source: US Far Behind in Race for Arctic Assets (Reliability: Medium)

Comments:  The ice in the Arctic Ocean has shrank to an all-time low this year due to man-made global warming.  

South African Mine Strike Spreads To More Mines

As many as 75,000 miners are already on strike. This equates
to about 15 percent of South Africa's mining sector's total workforce.

JOHANNESBURG (REUTERS)- Since Wednesday the mine strike has spread to a new sector: iron ore and it has hit another gold firm. Kumba an industrial unit of the global miner Anglo American, said the mine strike at its giant Sishen Mine in the Northern Cape involved 300 employees. It was limited to one area in the open cast mine, leaving most of the facility unaffected. Kumba is one of the world's top 10 iron ore producers. It produced 41.3 million tonnes of ore in 2011. Kumba's share price dropped more than 4 percent.

The strike is also testing President Jacob Zuma's leadership. The president is under fire for failing to address and contain the workers' protests demanding wage increases. There are glaring wealth inequalities persisting in South Africa since the end of the apartheid in 1994. Source: South Africa Wildcat Strikes Spread To More Mines (Reliability: High)

Comment: The spreading of labor unrest has raised fears that the country could see a repeat of the stand-off with police at Lonmin's platinum mine in August that led to the shooting of 34 miners. It was South Africa's bloodiest security incident since the end of the apartheid in 1994.

Innovation Metals Finishes Plans For Critical Rare-Earth Element Separation Facility

Innovation Metal's Rare-Earth Element Separation Facility
QUEBEC (AZOM) --On 5 October 2012, Innovation Metals announced the completion by GENIVAR Inc. of a set of process flow diagrams ("PFDs") for the extraction and purification stages of IMC's future critical rare-earth element (REE) separation facility in Becancour, Quebec. Starting with a mixed REE carbonate feedstock, produced by blending individual feedstock received from various future REE producers, the process starts with an acid-leaching phase, to solubilize the REEs, followed by a cascade of separation stages based on solvent-extraction techniques. As a result, the process creates formation of thirteen distinct high-purity rare-earth chloride products.
Source: IMC Collaborates to Develop PFDs For Rare-Earth Element Separation Facility (Reliability: High)

Comment: According to Patrick Wong, CEO of IMC, IMC is now one of the only companies outside of China with detailed quantitative designs for a critical REE separation plant.

Disputes in South and East China Seas due to Access to Strategic Mineral

Executive Summary:
The increasing number of territorial disputes in the South and East China Seas are due to control of potential mineral reserves. It is highly likely that the Chinese government will continue to bring attention to disputed regions like the Senkaku Islands, the Parcel Islands and the Spratly Islands in the next 12-24 months. These islands likely contain valuable strategic mineral resources as well as offshore oil deposits.

In mid-September political tensions came to a crescendo as China protested Japan’s continued occupation of the Senakaku Islands, 100 miles north of Taiwan. The islands are believed to contain valuable strategic mineral deposits. The uproar is one event in a series of ongoing disputes involving the PRC. In July, the People’s Liberation Army announced it would be sending a garrison of soldiers to the Parcel Islands, a small island chain claimed by Vietnam.

Map showing disputed territory in the South China SeaThe Philippines announced on Monday that 800 Marines would be sent to the Spratly Islands to further guard territorial claims there. The Spratly Islands are situated near by producing oil and natural gas fields in the South China Sea.

In response to the unrest with, Beijing offered 3 billion RMB to the ASEAN for a maritime cooperation fund. The fund is specifically aimed at cooling tensions with the Philippines and Vietnam. However, to date, the purpose of the fund has not been established, but this illustrates Beijing’s desire to resolve the conflict diplomatically.

Analytical Confidence:
Analytic confidence for this assessment is high.  The analyst did not utilize structured methods of analysis for this report.  Source reliability is high and the sources corroborated each other.  The analysts’ expertise is moderate and the analysts worked alone.  Subject complexity was medium and the time available for the task was abundant.

Methods And Processes:
The analyst worked alone on this document and did not need to use collaborative software or technology. The analyst used Google News searches to identify reliable sources and gather corroborative information.

Contact Information:
For comments, questions, or additional information, please contact the analyst:

Further Delays In Lynas Plant Operation In Malaysia

Malaysian activists protest against a proposed rare earth plant
Protesters are afraid of radioactive waste
THE AUSTRALIAN (SYDNEY) - Lynas in Malaysia is facing further challenges as a Malaysian court has postponed  until 10 October 2012 a hearing on a temporary operating license granted to the Australian miner for a rare earths plant . This court rule further delays the start of operations at the USD800 million facility, which has been opposed by green activists and concerns about radiation. Lynas received the temporary operating license in early September 2012 but Kuantan High Court in eastern Pahang state, where the plant is located, put it on hold later that month after an appeal by protesters. The objective of activists and local residents is to shut down the plant - the biggest outside China - which has emerged as a controversial issue in the campaign for next year national elections. The plant will process material from Lynas' Mount Weld mine in Western Australia. Lynas claims that the plant is safe, and any radioactive waste it produces will only be low-level and not harmful to human health.  Source: Hearing On Lynas Malaysia Plant Postponed (Reliability: Medium)

Comment:  In spite of close relations to Malaysian ruling political parties, Lynas could not open it's processing plant
because of public protests. Widespread protests can endanger future rare earths processing plants all over the world.

Thursday, October 4, 2012

Arctic Region Rich In Resources, Lacking In Framework

The arctic region.
MADRID (Eurasia Review)--Arctic ice has receded more over the past decade than at any other point in history, with summer ice melts making more areas accessible than ever before. The newly-accessible areas of the Arctic hold huge amounts of oil and gas as well as massive stock of high quality gold, diamond, plutonium and other rare earth minerals. A recent CSIS study found that although some Arctic countries (such as Russia) have claimed to support international cooperation in the Arctic, they have bolstered their military presence in the region. Since the region lacks any coherent framework to address international interests and concerns, it remains a potential flash point for all countries bordering the Arctic or with interests there. Source: Restructuring Arctic Stability And Global Security - Analysis (Reliability: Medium)

Comments: With even non-Arctic groups ranging from the EU to China expressing interest in exploiting Arctic resources, Arctic countries such as the US must act quickly if they are to protect their interests in strategic minerals, oil, gas, and even fishing.

Doubt Cast on Afghan MIning

WASHINGTON (WSJ) -- Afghanistan hopes to transform its $1 trillion in mineral deposits into a reliable economic base. However, researchers working for the U.S. military concluded that the cost to build and run a rail network across Afghanistan could cost greater than $54 billion.

A spokesman for Afghanistan's Foreign Ministry questioned the cost estimate and predicted that in the end the benefits of a nationwide rail system would outweigh the costs.  Officials in Afghanistan hope to generate $300 million from mining projects by 2016.  Within 12 years, Afghans hope mining revenues will contribute to half of the country's GDP, yet no large-scale  mining projects are in operation.

U.S. Department of Defense strategists backed the Afghanistan government in selling its biggest mineral interests to Chinese, Indian, Canadian and U.S. companies, from whom it hopes to receive licensing fees and royalties. The U.S. first began to consider minerals as a possible economic boost for Afghanistan in 2010. But U.S researchers outlined hurdles that would be difficult to overcome. It would require up to 3,000 miles of track through 16,000-foot mountain ranges.

Western officials however said Afghanistan would be able to pursue other major projects that use trucks rather than rail.  Source: Doubt Cast on Afghan Mining (Reliability: High)

Comment: According to the USGS, in addition to billions of dollars worth of iron and copper, there is an estimated $25 billion of gold, $81 billion of niobium, and sizable quantities of cobalt, molybdenum, asbestos, silver and other industrial minerals in Afghanistan mines.  U.S business interested in Afghanistan mines would benefit from pursuing the feasibility of strategic mineral mining to lessen our dependency on China. 

Senkaku-Diaoyu Islands Suspected of Holding Valuable Mineral Reserves

TOKYO (NATIONAL PUBLIC RADIO) — Tensions erupted last week between China and Japan over control of a small set of islands that lie 100 miles north of Taiwan. Anti-Japanese protests erupted in many major Chinese cities, including at the Japanese embassy in Beijing. Occupied by Japan since the end of the Second World War, the island chain is believed to contain valuable deposits of minerals, specifically rare earth minerals deemed strategic to national security by many nations.

The issue of possession of the islands was placed on the political back-burner for many decades. Former Chinese leader Deng Xiaoping advised both sides to build up their domestic economies and trade partnership before dealing with the potentially explosive issue.

The territorial dispute is the latest in a series of regional disputes in recent months. In July, the Chinese government announced it would send a military detachment to a group of small islands of the Vietnamese coast in the South China Sea. China and the Philippines also have a long running dispute over the Parcel Islands and Spratly Islands. Japan has a series of ongoing territorial disputes with Korea and Russia over the Dokdo islands and Kurile Islands, respectively.

(Reliability: Moderate)

Comment: The aggressiveness of Chinese territorial claims in the South China Sea have been increasing in the last 12 months. Political disputes and protests on all sides are not new, nor are they unique, as many of these territorial disputes are decades old. However, the expansion of Chinese territorial claims is likely due to an increased likelihood of each claim containing valuable mineral deposits.

Wednesday, October 3, 2012

Great Western Minerals Group To Conduct Yttrium Oxide Assessment for DoD

MICHIGAN (PROACTIVE INVESTORS) - The US Department of Defense announced on 1 October 2012 that it has chosen Great Western Minerals Group's (GWMG) rare earth processing subsidiary, Great Western Technologies of Troy, Michigan, to conduct a supply chain assessment for high purity yttrium oxide.
Yttrium Oxide (Y2O3)

Almost all high-purity yttria is currently produced in China. The DoD uses yttrium oxide in several defense applications such as polishing compounds for precision lasers and thermal barrier coatings for jet engines. The DoD has projected an annual shortfall of 93 short tons of elemental yttrium from domestic sources by 2013.

"We intend to advance previous Department of Defense research to uncover the extent to which the defense industrial base has the capacity to produce high-purity yttrium oxide to support critical defense programs," interim GWMG chief executive Robert Quinn said in a release. Source: Great Western Minerals to conduct yttrium oxide purification assessment for U.S. Department of Defense.
(Reliability: Moderate)

Comments: Since China produces nearly 95 percent of the world's rare earths, and since there are not effective substitutes for yttrium, finding domestic sources for mining and production is likely to become more important to national defense security. The use of yttrium as a component in phosphors and electronics is especially important to US economics and defense applications.