The challenges of ex-China rare earth mine development (and how to overcome them)
- By: John P Sykes
Posted in: Blog, Commodities, Management, Mineral Economics, Mining, Publications, Recommended, Strategy
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Last September, my colleague Josh Wright at Rowton Ltd., presented some work done with myself and Allan Trench on “The challenges of ex-China Rare Earth Mine Development (and how to overcome them)” at the Argus Media Rare Earths Conference in Hangzhou, China.
The presentation analysed the components of a good strategy for rare earths mine project development including funding options, market entry tactics, and corporate capabilities.
Funding options include: following the trends in ‘fashionable commodities’, bringing in a strategic investor, or sequencing convex projects before concave projects.
Viable market entry strategies include: being a first mover, or fast follower, being different, conducting exploration, using by-products to enter the market, ‘boot-strapping’, or temporarily taking a different path and coming back to the difficult rare earths project later, with greater resources.
Internal capabilities required by rare earths mine project developers differ from typical ‘junior explorers’ which often have geologically focused skillsets. For rare earths technological and engineering skills may be more valuable, as well as effective commodities marketing and trading capabilities, good stakeholder communication, and senior managers and project managers with experience in the rare earths industry, or other similar niche metal industries.
The presentation is available below, via Slideshare: