July 5 (Bloomberg) -- Underwater mining for rare earths, used in hybrid cars and plasma televisions, is economically and possibly environmentally unviable, an academic from the independent think-tank Council on Foreign Relations said.
“To get these minerals out of the ocean in the foreseeable future and to be economically viable is still a long, long way off,” David Abraham, an international affairs fellow at the New York-based CFR, said in a telephone interview from Xi’an, China, for Bloomberg Television today.
China, supplier of 95 percent of the 17 elements known as rare earths, has clamped down on rare-earth mining and cut export quotas, boosting prices and sparking concern among overseas users such as Japan about access to supplies. That has created demand to find new sources of the minerals outside of the Asian nation and get idled Western mines into production.
University of Tokyo geosystem engineer Yasuhiro Kato and a group of scientists catalogued hotspots of rare-earth accumulation on the bed of the Pacific Ocean, according to a July 3 article published in Nature Geoscience. The authors said one 1-square-kilometer area around a hotspot near Hawaii may hold 25,000 metric tons of rare earths. The quantity of rare earths in the ocean floor may exceed the 110 million tons buried on land, the journal said.
“The study shows that the concentrations of rare earths are higher than currently what you find in China,” said Abraham, who is also a University of Tokyo academic studying natural-resource security. “What makes China profitable is that the concentrations are very close to the surface. These researchers found resources in higher concentrations, but they’re 2 to 3 miles down, they’re far from any shore, there are a number environmental factors that are really not clear and the technology really isn’t there.”
The composite price of eight rare earths found at the Mount Weld project in Western Australia surged to $205.37 a kilogram as of yesterday, from $92.84 on March 31 and $11.59 in 2007, according to a table of figures on the website of Lynas Corp., a Sydney-based rare-earth developer.
Rare earths are also used in wind turbines and defense applications such as guided missiles. The market for the minerals may double to as much as $6 billion by the middle of the decade, Ernst & Young LLP analyst Michel Nestour wrote in an April 21 report.
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