(Reuters) - Canada’s Medallion Resources Ltd (MDL.V) said on Tuesday it was looking at sites across North America to develop an extraction plant for rare earths, as the ongoing U.S.-China trade war has turned the spotlight on the strategic metals.
Rare earths are essential components in rechargeable batteries that power electric and hybrid cars as well as fighter jets, tanks and other military equipment. There are currently no known substitutes.
Vancouver-based Medallion said it is seeking proposals from contractors to help build a plant to process the metals from the reddish-brown phosphate mineral monazite, a sand containing high concentrations of rare earths.
The company has relationships with monazite suppliers in the U.S. Southeast, but likely would build its plant in the center of North America, eyeing the region between Texas and Saskatchewan, Chief Executive Officer Don Lay said in a an interview.
China controls nearly all of the globe’s processing capacity for rare earths, a strategic edge it is using to its advantage in the trade dispute with the United States as it accounts for 80% of U.S. imports of the minerals, according to U.S. Geological Survey data.
“We see this as a key step to help build that value chain across North America,” Lay said.
Medallion is effectively looking for partners to help it build a facility that would turn monazite into rare earths for use in North America. Other rare earth projects under development in the region derive the minerals from hard rock or other sources.
The company declined to provide financial figures for the project or lay out a timeline.
Prices of neodymium rare earths - used in magnets and speakers - have surged 26.5% since May 20, while those of dysprosium and gadolinium oxide have gained around 10%.
California’s privately held Mountain Pass mine is the only operating U.S. rare earths facility, while Australia’s Lynas Corp Ltd (LYC.AX) in May agreed to build a rare earth processing facility in the country with Texas-based Blue Line Corp.
Reporting by Ernest Scheyder in Houston and Arathy S Nair in Bengaluru; editing by Sriraj Kalluvila and G Crosse