Commerce Resources: Ashram REE Deposit similar to Bayan Obo
----Interview with Chris Grove CEO Commerce Resources Corp.
Commerce Resources Corp. is an exploration company with a particular focus on the development of its Ashram Rare Earth Element Deposit in Quebec and the Upper Fir Tantalum-Niobium Deposit in British Columbia. The measured, indicated and inferred resources of Ashram Rare Earth Element Deposit are 1.59 Mt averaging 1.77% TREO, 27.67 Mt averaging 1.90% TREO and 219.8Mt averaging 1.88% TREO respectively.
Asian Metal: Thanks for accepting the interview of Asian Metal, Chris! First at all, would you please give a brief introduction of your company firstly?
Chris: Commerce Resources Corp. was created in 1999 and was originally focused on the exploration and development of a set of carbonatites in British Columbia that were prospective for tantalum, niobium, and then later, REE's. Following the imposition of the "two tiered pricing system" for REE's in 2005 we began our hunt for a world class deposit of REE's. Following the quadrupling of the global niobium price in late 2006, we staked the Eldor claims in Quebec, which were seen as highly prospective for high grades of niobium. However, since the majority of REE's are also from carbonatite hosted sources, we continued to investigate this possibility in Quebec in parallel along with exploration for niobium.
Asian Metal: Would you like to introduce your Ashram Rare Earth Element Project?
Chris: We conducted very significant and detailed exploration programs in 2007, 2008 and 2009 on our claims in Quebec. On the last day of the field program in 2009, our Project Manager, Mr. Darren Smith directed two staff geologists to investigate one magnetic high anomaly, and this is when the Ashram Deposit outcrop was found and sampled. We drilled this area the following season and released the first drill hole on the Ashram in August 2010. The Ashram is a huge carbonatite deposit that has monazite and basnaesite mineralization, with a small amount of xenotyme. This mineralization is what allows the Ashram Deposit to have significant success with standard processing.
Asian Metal: As far as I know, you have finished the PEA of Ashram Rare Earth Element Project? Would you please share the results of the PEA?
Chris: The PEA, released in 2012, was based upon just a 10% TREO concentrate, from the simple beneficiation of ore (crushing, grinding and floatation). The PEA had a $2.3 B CAD NPV and a 44% IRR, based upon a 4,000t per day extraction, and an annual production of 16,850t of a mixed rare earth concentrate without any by products. We now produce concentrates in the +45% TREO range and with a fluorite by product. The fluorite by product will ideally be upgraded to an acid grade fluorspar concentrate.
Asian Metal: What do you see as the major advantages of Ashram Rare Earth Element Project?
Chris: I see the major advantages of the Ashram REE Deposit being that it is similar to Bayan Obo in that both deposits are carbonatites with standard mineralization, and the economic benefit of a valuable by product. The Ashram is huge, and it is also located in one of the most attractive mining jurisdictions in the world – Quebec, Canada. Our largest shareholder is Ressources Quebec, the fund run by the Government of Quebec. The Government of Quebec has also previously financed infrastructure builds for other mines such as Glencore's Raglan nickel mine, and Stornoway's Renard diamond mine. We hope that they may also do the same for our area in Nunavik, Quebec.
Asian Metal:?May I know what's your next development plan for Ashram Rare Earth Element Project?
Chris: We are intending to re-start our pilot plant at Hazen Research in Colorado and to produce representative samples of the 45% TREO concentrates that world REE processors have requested of us. Additionally, we intend to do downstream processing to produce separated oxide, carbonate or chloride concentrate products that world manufacturers have requested of us, starting with lanthanum oxide and cerium carbonate. As well, we will look to upgrade our fluorite by product to ideally an acid grade fluorspar sample and will deliver this, to Glencore with whom we have an MOU, which includes a deep discount on acid supplies in exchange for a consideration of our fluorspar by product. We will also look to complete our Pre-feasibility study, and following that, our Bankable feasibility study.
Asian Metal: It is well known that developing a rare earth mine need to overcome a lot of difficulties. Would you please introduce what is the major challenge Commerce Resources is facing now?
Chris: As we have the most standard type of REE deposit, that is similar to the world's dominant producer Bayan Obo, I would suggest that we do not have many of the challenges that other projects have in proving up positive economics. The major challenge that Commerce Resources has at this time is access to capital, and the need for infrastructure to get our material to tide water. Secondly, we are interested in the input of an industry partner as to what our final products will be, whether it will be mixed RE concentrates or separated oxides.
Asian Metal:?After increased by around one month, Chinese PrNd oxide market kept witnessing dropping prices over the past three weeks due to consumers' wait-and-see attitudes. Current mainstream prices of the material dropped to RMB330,000-335,000/t, a decline of around 11% from two weeks ago. It seems that some major suppliers believe current prices are already low and prefer to watch the market. Would you please share your opinion about PrNd oxide price trend in the near term?
Chris: I am glad to say that I look to services such as Asian Metal for price information, but I would also say that I believe that we should see stable to slightly rising prices, following the shift in global production last year that has China now as a net importer of the REE's and while global demand for products and designs that are manufactured with REE magnets increases; this is the way of the future with the global drive to reduce dependency on fossil fuels and I see this trend only increasing in intensity.
Asian Metal: May I know your thoughts about NdFeB magnet industry development prospect?
Chris: Ultimately, there are so many significant reasons to see an increase of REE permanent magnet production, with "clean energy" being perhaps at the top of the list that I expect to see magnet manufacturing capacity continuing to increase for the foreseeable future. Additional reasons would include fuel efficiency in aircraft as manufacturers switch over from the use of hydraulics to electrics. Overall, until a new clean energy source is realized in a commercial setting, this drive and increase of capacity will just continue I believe.
Asian Metal: Thanks for your time. Wish you every success in your business.
Chris: Thank you kindly for your interest in our Ashram REE Deposit.
