Defense Metals Corp. (TSXV: DEFN) (OTCQB: DFMTF) and Ucore Rare Metals Inc (TSXV: UCU) are considering working together to create a North American supply chain for rare earth elements (REE).
The two companies announced the signing of a non-binding memorandum of understanding on Tuesday to explore potential collaborations in support of the commercialization of rare earth elements production in North America.
As part of the initial projects outlined in the memorandum, Defense Metals will send a mixed rare earth carbonate sample from its Wicheeda REE project to Ucore Rare Metals’ Kingston, Ontario, RapidSX Commercialization and Demonstration Facility (CDF).
SGS Canada Inc. in Lakefield, Ontario, will transport the sample to Ucore’s facility on behalf of Defense Metals. Defense Metals generated this sample during hydrometallurgical piloting test work conducted in 2023 using concentrate produced in earlier flotation pilot plant testing of a 26-tonne bulk sample from its wholly-owned Wicheeda REE project in British Columbia.
“The MOU lays out the framework wherein Defense Metals’ technically strong and readily accessible North American REE resource can be further processed and refined using Ucore’s Canadian-founded technology, RapidSX,” said Pat Ryan, chairman and CEO of Ucore.
“Receiving the sample mixed rare earth carbonate at our Kingston CDF will start the process of determining what may be possible between the companies as we collectively look to fuel the 21st-century energy transition.”
Defense Metals owns Wicheeda, a high-quality open-pit rare earth asset located in British Columbia, which is in the pre-feasibility study stage, with an expected completion in Q2.
Wicheeda is accessible by road, adjacent to rail, and has access to power, gas, and a significant deep-sea port nearby.
Read more: Idaho Strategic Resources discovers high grade rare earth elements in Idaho
Read more: Bacterial protein outperforms humans in separating rare earth elements: Penn State
China dominates REE supply chain
The story surrounding rare earth elements follows the same arc as that of critical minerals like lithium. China holds a dominant position in both markets, which has flared geopolitical tensions with the west.
Canada unveiled a CAD$4 billion plan in its federal budget late last year to reduce its dependence on China for rare earths and critical minerals.
However, the country does not produce substantial quantities of these minerals but instead makes significant investments in mining operations overseas. China controls the manufacturing supply chain for battery cell components and critical mineral refining and processing.
Rare earth elements are a group of 17 chemically similar metallic elements found in the Earth’s crust. These elements include lanthanum, cerium, neodymium, and others. They are considered “rare” due to their relatively low abundance in the Earth’s crust compared to other more common elements.
Despite their scarcity, REEs play a crucial role in modern technology and industry. They are essential components in various high-tech applications, including smartphones, electric vehicle batteries, and defense technologies.
Additionally, their unique magnetic, electrical, and catalytic properties make REEs indispensable in advancing electronics, renewable energy systems, and green technologies.
As a result, securing a stable supply of rare earth elements has become strategically important for many countries and industries. This has led to attempts to diversify sources and promote recycling to reduce dependence on a limited number of suppliers.
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