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Alkane Resources' rare earths project gains boost from Chinese restrictions of export of rare earths

Alkane Resources' rare earths project gains boost from Chinese restrictions of export of rare earths

Multi commodity explorer, Alkane Resources' (ASX: ALK) rare earths plans have received a boost - as a result of a report by the Chinese Ministry of Industry and Information.

The draft plan would curtail export by suppliers in China of some rare earths and impose more stringent export quotas for rare earths suppliers.  China currently produces 95% of the world’s rare earth output.

This is where Alkane's Dubbo Zirconia Project (DZP) in New South Wales starts to look mighty handy.

As a result, development of Dubbo Zirconia project could just become the most significant producer of yttrium, dysprosium and terbium - outside of China.

The Dubbo project remains one of the world’s most advanced developments for zirconium, niobium, yttrium and rare earth production and is based upon a world class resource. Total inferred and measured resource at Dubbo is 73.2 million tonnes at 1.96% ZrO2 and various grades of other materials.

A feasibility study back in 2002, then, estimated the primary metal output zirconium chemicals could have a throughput of 200,000 tonnes per annum. Since that time the zirconium market has expanded and a greater throughput is possible. Also demand for the niobium concentrate and yttrium and rare earth products has increased dramatically, and support a larger start up capacity.

Alkane has also been operating a demonstration Pilot Plant at Lucas Heights, south of Sydney continuously since 2008.  It has proven the flow sheet for the DZP to recover a suite of zirconium chemicals, zirconia, a niobium-tantalum concentrate and yttrium-rare earth concentrates which are used in the expanding ceramic, catalyst, electronics,
rechargeable batteries.

The Company is receiving a positive response to its sample products.

As a comparison of other deposits, The DZP is the most advanced non-Chinese development for zirconium, niobium, yttrium and rare earth production. While Molycorp’s Mountain Pass operation in California and Lynas’ Mt Weld planned operations in Western Australia and Malaysia aim to produce light rare earths.

Alkane is in a unique position to be the leading Western heavy rare earths producer over the next decade.

Marketing activities are advanced with direct contact with potential customers in Japan, Europe and North America, and zirconium and niobium product samples being sent to Japan, China and Europe.

Distribution of yttrium and rare earth samples is anticipated to commence later this year.

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