Chris Grove: Best Value in the Junior Mining Space
Tom welcomes a new guest Christopher Grove, President of Commerce Resources, to the show. Chris discusses rare earth elements and why some are extremely important, particularly in permanent magnets for electric motor and generator applications. Four rare earth metals used in these motors are dysprosium, terbium, praseodymium, and most importantly, neodymium.
In 2010, China, the biggest producer of these metals, cut off supply to Japan. As a result, prices exploded just as Tesla came to the market. So instead of using these magnets, Tesla created an A.C. induction motor to save on costs. Then, in late 2017, Tesla signed a deal with a Chinese manufacturer, and now all Tesla’s have D.C. permanent magnet motors.
China has clearly shown itself to be unreliable as a supplier of these metals. They have forced manufacturers to build plants inside of their country by controlling exports and imposing duties. Therefore, relying on China comes with significant risks.
Energy Fuels in Utah is now the first rare earth element processor operational in North America. The U.K. also recently brought a processing plant online. We need a fully vertically integrated rare earth supply chain without reliance on China.
Rare earth metals are rare due to the economics of the commodity as they are typically hosted with other minerals.
Rare-earth element mining has sparked environmental concerns, but in practice, these mines are no more dangerous to the environment than any other type of mining. Instead, this reputation was created from past environmental problems in places like China.
Time Stamp References:
0:00 – Introduction
0:37 – Rare Earth Metals
4:15 – China & Risks
12:28 – N.A. Refining Capability
14:54 – Partnerships?
17:49 – Industry & Spot Market
19:43 – Rare Earth Juniors
22:39 – Host Mineralization
24:13 – VanEck Rare Earth ETF
26:43 – Permits & Concerns?
30:45 – Jurisdictions
34:21 – Concluding Thoughts
35:36 – Wrap Up
Talking Points From This Episode
- Importance and applications for rare earth elements.
- Strategic risks regarding China, production, and refining.
- Environmental concerns, permitting, and jurisdictions.
Mr. Christopher Grove is President and Director of Commerce Resources since September 2014. Previously, he worked as Corporate Communications for Commerce since 2004 and has significant contacts within the financial communities in North America and Europe. Mr. Grove joined the Commerce Resource board in 2012 and has been active in representing the company abroad.