US$600 million later Japan’s Nippon Light Metals shelves Jamaica Rare Earth Test Pilot Plant - Cheaper Electricity needed as FDI’s want in Copper and Gold

“The highly depressed state of the REE (Rare Earth element) market at this time would not make it a favourable time to make significant investments which would be required. We need to keep monitoring the market as we proceed with our research and development work”

JBI's Executive Director, Dr. Parris Lyew-Ayee responding to emailed Questions from the Jamaica Gleaner about the Japan’s Nippon Light Metals Test Pilot Plant to produce Rare Earth Metals from Bauxite Red Mud

Jamaica apparently has decided that Rare Earth aren’t worth it after all, despite the promise of higher returns on RDA (Residue Disposal Area) Mud that result from the processing of Bauxite.

After spending some US$600 million on building a Pilot Test Plant to test out the idea of Extracting Rare Earth Metals from that Red Mud, the project is now on a protracted indefinate pause!

Japan’s Nippon Light Metals, after having invested some US$600 million, have decided not to go commercial with the Plant citing the depressed Rare Earth Market as reported in the article “Depressed Rare Earth market puts Jamaica's project on hold” Published Wednesday July 30, 2014, by Avia Collinder, The Jamaica Gleaner.

Thus I’ve gotten my answer as to why there has been no News about the progress of the Rare Earth Pilot Plant hosted at the Headquarters of the JBI (Jamaica Bauxite Institute near Hope Gardens as I'd opined in my blog article entitled “No news on progress of the Rare Earth Pilot Plant at JBI - Cuba-Jamaica CFL Project Heralds manufacturing of LED's, Li-Ion Batteries and Sapphire Screens in Jamaica”.

The reason why the project got stalled after it got off to such a good start in 2012 when Japan’s Nippon Light Metals expressed an interest in extracting Rare Earth Metals from our Red Mud left over from Bauxite Mining as recorded in my blog article entitled “Japan’s Nippon Light Metal Company Limited to mine Rare Earth elements in Jamaica - Jack Reacher (2013) recycling gadgets for Rare Earth Elements” are mainly due to the resolution of a WTO dispute between Japan and China.

Japan, China and Rare Earth - Glut created by Americans and Afghanistan's US$1 trillion potential

 Apparently the Japanese have finally won their case before the WTO (World Trade Organization). This forced China, who possess 97% of natural reserves of Rare Earth Metals, to resume exports after having suspended them back in 2010 as I’d reported back in 2010 in my Geezam blog article entitled “Chinese Crisis in Rare Earth Metals – Afghanistan is Silicon Valley’s Savior”.

Unfortunately, American began to resume production of Rare Earth Metals as well. Add to that the fact that Afghanistan was discovered back in 2006 and then 2010 by the USGS (United States Geological Survey) to have significant deposits of Rare Earth Metals, valued at some US$1 trillion as noted in “$1 Trillion Trove of Rare Minerals Revealed Under Afghanistan”, published September 04, 2014 07:35am ET by Charles Q. Choi, LiveScience and a glut in Rare Earth Metals was the result.

Thus the prices that Minister of Science, Technology, Energy and Mining Phillip Paulwell promised of US$3,500 per kilogram on the International Mercantile Exchange Markets for use in Electronics and All-Electric vehicles as I’d recorded in my blog article entitled “Rare Earth Metal Pilot Plant at Jamaica Bauxite Institute to test Rare Earth Extraction Process - Nippon Light Metal Company Limited keen to beat China using Red Mud from Bauxite Companies” are no more.

According to Engineer Howard Chin, suggest that Minister Paulwell was being a bit over-ambitions, point to out that the current prices were somewhere between US$1 to US$10 on the markets. All thanks to the glut in Supply and Afghanistan's S$1 trillion potential Rare Earth Deposits that can lift that country out of poverty!

Mining Rare Earth Metals still viable – Cheaper Electricity needed as FDI’s interested in Copper and Gold

Good to note that even at US$1 per kilogram, that’s way more than the US$300 per tonne that Alumina, the main product of Bauxite Mining make as noted in my blog article entitled “Japan’s Nippon Light Metal Company Limited to mine Rare Earth elements in Jamaica - Jack Reacher (2013) recycling gadgets for Rare Earth Elements” .

Also ever since the Japanese have taken an interest in Jamaica, mining other minerals such as Gold and Copper have been on the increase, with no less than four (4) prospectors for Copper currently in Jamaica doing chemical assays of bore samples to determine if copper is present in commercially viable quantities as noted in my blog article entitled “OZ Minerals of Australia prospecting for Copper in Jamaica - How to get into Mining Minerals in Jamaica and Vybz Kartel's Trailer Load of Money”. 

Based on the article “How much gold is in those hills?”, published Sunday, August 17, 2014 BY KARENA BENNETT Business reporter, The Jamaica Observer, the following minerals being mined in Jamaica fetch the following prices at the Mercantile Exchange Spot Market:

1.         US$30,000 per kilogram for Gold

2.         US$6.60 per kilogram for Copper

Mining Copper costs less than Rare Earth Mineral, yet prospectors’ in the form of Canadian Firm, Carube Resources and Australia-based Oz Minerals, since 2011, have been sinking millions in to the Bellas Gate Project with the hope of making money. This wouldn’t haven’t been  ongoing since 2011 id there wasn’t money to be made from selling Copper at US$6.60 per kilogram, which is still more than Bauxite.

So market Economics argument aside, the reason for Japan’s Nippon Light Metals  pulling out of the Test Pilot Project for Extracting Rare Earth Metals from RDA Red Mud doesn’t make sense.

Also, the high concentration of the RDA Red Mud means that the Rare Earth Metal concentrations makes them easier to extract, reducing the costs of inputs such as Electricity, the only thing aside from price stopping  Japan’s Nippon Light Metals from pursuing this project to fruition.

Had Jamaica had cheaper electricity thanks to LNG Power Plant which the Dr. Vincent Lawrence ESET has set for a 2017 completion as reported in my blog article entitled “Dr. Vincent Lawrence ESET sets 2017 for 381 MW Project - Why JPS Co says LNG even though Ethane and Propane cheaper as Hydrogen Economy possible”, not only would Bauxite flourish, but this project would be economically viable, no matter what price Rare Earth Metals falls.

It’s an indication of a poor business planning on the part of the Ministry of Science, Technology, Energy and Mining and Japan’s Nippon Light Metals when a company, after investing some US600 million, end up being thwarted just because the price in the market falls. 

Jamaica’s Mineral Resources – Multimillion dollar Foreign Exchange Potential requires Investors

Still there's other minerals that are yet to be fully exploited such as Iron and Titanium Oxides, used mainly in Paints and Catalysts as noted in my blog article entitled “Rare Earth Metals Extraction from RDA Red Mud's got Titanium and Iron by-products - All You Need is Kill the Scrap Metal Industry and Agriculture benefits in The Place Beyond the Pines”.

This as mentioned by JBI's Executive Director, Dr. Parris Lyew-Ayee, quote : “The red mud ponds are multi-elemental resources, bearing REEs as well as iron, titanium and several other valuable minerals. So it is difficult to put a value on these deposits at this time”.

Rather than being dead, the project is being regarded by the Ministry of Science, Technology, Energy and Mining as being on a pause, thanks to China and Japan kissing and making up. Already, it’s also causing an increased international interest in our Mining Sector, as FDI (Foreign Direct Investors) come to Jamaica, literally seeking Gold and other Precious minerals!