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Thursday, Jul 25, 2024
Mugglehead Magazine
Alternative investment news based in Vancouver, B.C.

Mining

New discovery in Wyoming may challenge China’s dominance of rare earth elements

Critical minerals are important because they are key components in a wide range of modern technologies and industries

New discovery in Wyoming may challenge China's dominance of rare earth elements
Image via Rare Earth Elements.

A recent discovery in Wyoming could end China’s stranglehold on the world’s supply of rare earth elements.

American Rare Earths Inc. (ASX: ARR) (OTCQB: ARRNF) claims that its discovery of approximately 2.34 billion metric tons of rare earth minerals near Wheatland, Wyoming, surpasses the 44 million tons the entirety of China possesses. The company made this assertion after drilling only a quarter of the total site, stating that the discovery is bigger than it ever imagined.

This news nearly a year after the Brook Mine in Wyoming was discovered with a million metric tonnes of rare-earth oxides with a value of YSD$37 billion.

If properly exploited, this discovery could become the biggest natural resource discovery in the U.S. This discovery comes as the U.S. and China are at loggerheads. This new discovery could theoretically give the United States an economic and geopolitical advantage of China and Russia in the near future.

Critical minerals are important because they are key components in a wide range of modern technologies and industries. They have integral parts to play in the green transition. They’re involved in the production of renewable energy technology like wind turbines, solar panels and electric vehicle batteries.

Additionally, critical minerals are indispensable in the manufacturing of electronics, aerospace, defense systems, and medical devices. Their unique properties make them irreplaceable in many high-tech applications. As global demand for these technologies grows, securing a stable supply of critical minerals becomes increasingly important for economic growth, national security, and technological advancement.

In recent years, China has gotten themselves in the way of this aim.

Read more: U.S. Gold to present at New York’s Current Trends in Mining Finance Conference

Read more: U.S. Gold interview highlights importance of flagship site’s new mining permit

China’s dominance allows undue influence of global supply and prices

China controls over 80 per cent of the world’s supply of these minerals and dominates the processing and refining of these critical materials. The company’s dominance allows it to influence global prices and supply chains, creating vulnerabilities for other nations reliant on these materials.

This monopolistic control has prompted concerns about supply security, economic dependency, and the potential for geopolitical leverage, driving other countries to seek alternative sources and develop their own processing capabilities to reduce reliance on Chinese supplies.

In December 2023, China placed an embargo on exporting gallium and germanium to the U.S.

The United States is rushing to catch up with China and other countries on rare-earth supply, driven by increasing demand for applications ranging from electric automobiles to offshore wind turbines.

A survey shows that the United States uses an average of 8,300 metric tonnes of rare-earth oxides annually. Don Swartz, CEO of American Rare Earths, stated that Chinese companies aim to dominate their respective markets. Two months later, Swartz and his group attempted to unseat China as the market leader.

The business holds four mineral leases in Wyoming at Cowboy State Mine and interests in 367 mining claims at Halleck Creek, covering 6,320 acres. After their first drilling in March 2023, American Rare Earths estimated there were 1.2 million metric tons in northern Wyoming. However, a follow-up in the fall revealed 64 per cent more.

Read more: U.S. Gold secures US$4.9 million to advance Wyoming copper-gold asset

Read more: U.S. Gold Corp acquires environmental quality permit in Wyoming

Wyoming has an attractive regulatory regime

Poly-metallic mining in Wyoming is gaining attention due to the state’s rich deposits of various valuable minerals.

This type of mining targets multiple metals within the same mining operation, optimizing resource extraction and economic returns. Wyoming’s diverse geological formations host significant reserves of rare earth elements, gold, silver, and base metals.

The state’s favourable mining regulations and infrastructure further enhance its attractiveness for mining companies. Notable companies with mining operations in Wyoming include U.S. Gold Corp. (NASDAQ: USAU), which focuses on exploring and developing gold resources. Also, Energy Fuels Inc. (NYSE: UUUU) (TSX: EFR), a leading producer of uranium and vanadium.

Additionally, Rare Element Resources (OTCQB: REEMF), which specializes in rare earth element mining and competes with American Rare Earths.

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U.S. Gold Corp. is a sponsor of Mugglehead news coverage

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