Rare Earth Exchanges

Look Out China! Fed-backed, $53m Construction of Rare Earth Element Refinery in Wyoming Imminent

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Highlights

  • Rare Element Resources plans to build a demonstration plant for rare earth processing in Upton, Wyoming.
  • The project will receive federal support and utilize innovative technology.
  • Delays and increased costs due to inflation have impacted the project’s timeline.
  • The project is set to commence in Q4 2024, pending final approval from the U.S. Nuclear Regulatory Commission.
  • The plant aims to introduce disruptive processes to help the U.S. compete with China in rare earth element refining.
  • Potential implications of the project include advancements in technology, energy, and defense applications.

Wyoming has always been an independent place, one with a pioneer heritage, rugged, with its people tied inexorably to the land, driven by a sense of potential, prosperity and very importantly, independence.  With a compelling state tax scheme and a legacy of energy industry pedigree now the construction of a Rare Element Resource (opens in a new tab)s demonstration plant in Upton, Wyoming (opens in a new tab), could commence Q4 2024 even though the project has been impacted by delays and inflation.   A potential game changer made even more intriguing with the federal support in the form of capital injection. But it’s certainly fitting that the first processing plant constructed back in the USA (other than MP Materials in California) would be here in “the Cowboy State.” Importantly not only does this federally supported project potentially usher a mission-critical processing facility but also introduces disruptive process and technology to help processors compete with China when it’s online. Of course, in places like Wyoming especially, a good brand is a promise delivered.

According to available information, the last time a rare earth element refinery was built in the United States was when MP Materials received a Department of Defense contract in February (opens in a new tab) 2022 to construct a facility at the Mountain Pass mine in California, specifically designed to process heavy rare earth elements; this marked the start of a new rare earth processing facility in the US.

But here comes the Cowboy State!

As reported by the local Cowboy State Daily high inflation has inhibited the project’s kickoff, postponing the processing plant’ opening till July as reported (opens in a new tab) by Pat Hale for the local news earlier this summer.

Situated in the northeast corner of the state, adjacent to a large rare earth element deposit (opens in a new tab), the inflation contributed another 21% to the overall cost of the refining plant, taking the cost from the initially planned $44 million to what is now $53 million reports Ms. Hale.

Feds Backing

The feds of course are motivated to get rare earth materials processing back home in the United States. Enter the U.S. Department of Energy issuance of a second and final Project Continuation Notice supporting the Upton plant project. 

And the federal agency is contributing a 10% increase to support the effort at $53.6 million, boosting federal support from $21.8 million to about $24.2 million reports Renée Jean in today's piece.

What’s next needed to commence the project?

According to the latest entry from Cowboy State Daily the company now only needs one more federal thumb-up, from the U.S. Nuclear Regulatory Commission to commence the project.

And according to President and CEO Ken Mushinski (opens in a new tab), this should be coming within a few weeks.

What does the novel approach?

Rare Element Resources claims to be pioneering its own “best-in-class refinement process” essentially bringing lean processes to cut down on the number of steps as compared to traditional rare earth element refining, while also reducing waste.

According to the local media a “game changing” situation for Wyoming, and America.

But does the company have any evidence that its disruptiveprocesses can work well in the real-world?

Yes, the company declares that it has already demonstrated notable success with its process at the laboratory level. But now it must scale up, proving the feasibility of the modified processes at scale.

The Company

Publicly traded, Rare Element Resources is considered a strategic materials company focused on delivering rare earth products for technology, energy, and defense applications by advancing the Bear Lodge Critical Rare Earth Project in northeast Wyoming. Bear Lodge is a significant mineralized district containing many of the less common, more valuable, critical rare earths elements (REEs) that are essential for high-strength permanent magnets, electronics, fiber optics, laser systems for medical technology and defense, as well as technologies like electric vehicles, solar panels, and wind turbines.  

The proprietary technology for REE extraction/separation, developed by the Company and being advanced by affiliates of the Company’s majority shareholder, General Atomics (opens in a new tab) (GA), has successfully separated REE oxides into commercial-grade, saleable products, such as neodymium/praseodymium (Nd/Pr) oxide. Indications are that it will do so with greater efficiency and lower environmental impact than current industry methods. 

Rare Element Resources was incorporated in 1999. Its common shares are traded on the OTCQB Venture Marketplace (“OTCQB”) under the symbol “REEMF.”

Its current stock price is at a low of 0.3850.  Company stock price has been in the doldrums for years. Will this project raise the value?  It should be successful.

What firm is managing the staffing/contractors?

Wyoming’s Wood PLC (opens in a new tab) of Gillette, Wyoming

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