Metals Set To Energise Future

THE CONFERENCE CALLER: The mining sector looks set to be a leading force in the looming green revolution as the current crop of explorers seek to establish projects designed to contribute to a low carbon future. By Mark Fraser

During the 2020 RIU Explorers Conference in Fremantle, a large number of companies made it clear that they have a firm eye on issues pertaining to sustainability as they go about developing their respective mineral assets.

In particular, they are looking to help supply the electric vehicle and wind turbine markets with the metals they need as reliance on fossil fuels across the globe continues to dampen.

During his market update at the start of day two, Canaccord Genuity head of mining research Reg Spencer reconfirmed everyone’s suspicions that the prices for some of the metals used in modern cars – including nickel and copper – had bottomed in 2020 but were expected to rally next year.

Then there were the niche minerals, which also look set to have their day over the next decade.

“I think most people will agree that the outlook for lithium and battery materials does remain positive,” Spencer said.

“The reduction of carbon emissions, especially from transport, does remain the key focus for the near term.”

Spencer said Canaccord was surprised at the lack of attention the rare earths sector was receiving from investors – especially as it was forecast that wind energy capacity would increase by 2,500 per cent between 2007 and 2030.

“Rare Earth permanent magnets are critical components for electric vehicle drive chains and wind turbine generators – and market dynamics are evolving significantly, with an increase in desire for ex-China supply and a tighter regulation of Chinese production,” Spencer continued.

“Now we expect demand to grow significantly … demand should more or less double over the next 10 years … and that will be primarily driven by electric vehicles and wind turbines.

“With these factors in play, and the changing dynamics of the supply-demand equation – and the potential for China to lose their tight grip on the rare earths market – we see opportunities for this particular sector over the next couple of years as well.”

During a later presentation, Northern Minerals managing director and chief executive George Bauk also wondered why the investment community seemed to be disinterested in rare earth stocks.

The company is currently developing its advanced Browns Range rare earths project, which straddles the Western Australian and Northern Territory borders in the Tanami region.

“That’s a bloody good question – why invest in Northern Minerals?” Bauk put to his audience.

“We’ve really got to get people back into believing in rare earths and get the equity markets to back it.

“We haven’t had the moment, if you like, to get people interested in it.

“The governments are doing things and working on it – I’m not quite sure what the event has got to be to get people back on the screens and buy rare earth stocks.

“But if you are getting a bit sick and bored with gold stories, come and have a look at Northern Minerals and rare earths.”

Meanwhile, RareX executive director Jeremy Robinson said it was important that another Australian company follow in the footsteps of Lynas Corporation and develop a significant rare earths project outside of China (which has one major mine that currently produces about 80% of the world’s output) to ensure a supply chain remained in place for the West.

Like Northern Minerals, RareX has a project in WA – that being the company’s Cummins Range play in the state’s East Kimberley.

“There is only one major (rare earths) development in the world outside of China and that’s Lynas,” Robinson said.

“And Lynas sells a lot of its product into its own refinery, and into Japan and Europe.

“So what you see is a very risky supply chain there for the West, especially in military operations (which would) all get shut down.

“You see a lot of talk about this in the press and I think you are going to see a lot of action in places like the US and Australia.”