Private equity group SRE Minerals plans to develop what they say could be the world’s largest rare earth elements (REEs) deposit as part of a joint venture with the North Korean government.
SRE estimates that the Jongju deposit in North Korea holds 216 million tonnes of rare earth oxides, which includes about 2.66% of heavy REEs, as well as light REEs and rare earth minerals.
This is double the world stockpile of rare earths, which, according to the US geological survey’s most recent estimate, stands at 110 million tonnes.
SRE Minerals estimates the value of the resources in the ground at $64.9 trillion, an impressive amount considering North Korea’s GDP stands at $12.4 billion and global GDP is $69 trillion.
The joint venture company, operating under the name Pacific Century Rare Earth Minerals (PCL), has a 25-year license to mine the deposit and plans to build a processing plant on site.
“This represents an exciting opportunity for investors to be part of the early stage exploration and subsequence [sic] production of possibly the largest rare earth deposit in the world,” SRE Minerals said.
When Molycorp started producing REEs to combat supply risks in a market dominated by China, prices suffered against the effects of new supply. Hotline wonders what a mine containing over 200 million tonnes will do to the market.
But Hotline is also sceptical whether the mine will ever start producing rare earths given their weak prices and the current political climate in North Korea. But then again Metal Bulletin also thought aluminium premiums would fall.
Perhaps it’s time for a Metal Bulletin questionnaire. What is more likely to happen in 2014? Suggested options: Rare earths are mined in North Korea Platinum is mined on asteroids Aluminium premiums will fall