Great Western Minerals Group [TSX.V: GWG]
Saskatchewan-based Great Western Minerals has a fully integrated rare earths mine to market (M2M) strategy. The company's aim is to become the first vertically integrated rare earth elements producer in North America, a leader in the industry outside of China, and to create certainty of supply for its customers. To that end the company is investing in three stages in the rare earths supply chain: exploration, mining and processing.
Working backwards down the chain, the company already processes rare earths through two of its subsidiaries; Less Common Metals (LCM) based in Birkenhead, England and Great Western Technologies Inc in Troy, Michigan, USA. LCM has been highly profitable for 18 years supplying customers globally with a wide range of rare earth based alloys and metals. Its specialities include neodymium iron boron and samarium cobalt alloys for supermagnets, supplying 20% of the world demand of samarium cobalt. Great Western Technologies is a leading production facility in North America for rare earth materials, powders, and custom vacuum-grade specialty alloys. Both companies aim to be leading-edge, innovative and high quality offering flexible customised approaches to their customers. Great Western has just signed a letter of intent to supply samarium, gadolinium and samarium-cobalt alloys to the Pennsylvania-based Electron Energy Corporation to manufacture magnets.
Great Western will source its feedstock from the former-producing Steenkampskraal Mine in South Africa, located 350km north west of Cape Town. The mine was operated by Anglo American from 1952-63 producing rare earths and thorium (it was then the world's largest producer of thorium). It was eventually acquired by Rare Earth Extraction Co ("Rareco"), and in January 2009 GWT entered into an option agreement with Rareco to refurbish and recommission the mine and to have exclusive access to 100% of the rare earth elements mined there for a ten-year period. The New Order Mining Right was granted in June 2010, and in September 2010 GWT acquired a 20.8% equity interest in Rareco. In December GWMG offered to purchase all the remaining Rareco shares at 3 South African Rand, an offer which Rareco Directors recommended accepting. By 24 January the company had acquired about 70% of the outstanding shares. The offer remains open until 28th February.
SRK Consulting is conducting a feasibility study on the project with the aim of resuming production as quickly as possible; the target is the second half of 2013. Infrastructure is excellent, with access to the site by paved and gravel roads and close proximity to rail and sea-port; the government is pro-development, and there is technical expertise and a trainable workforce at hand.
GWMG is also looking to the long term by investing in 7 exploration projects in Canada and the USA all focussed to heavy rare earths; four of these are 100% owned and three are joint ventures. Hoidas Lake in Saskatchewan some 50km north of Uranium City is the most advanced with an NI43-101 compliant measured and indicated resource of 2.6M tonnes at an average grade of 2.43% TREO plus yttrium oxide. The endowment of neodymium is particularly high. |
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