One of the best reads from Jack Lifton. Sorry, if it is already...

One of the best reads from Jack Lifton. Sorry, if it is already been posted. But, worth reading as well the comments ...

GLTA

Five


http://proedgewire.com/rare-earth-intel/what-will-it-take-to-make-molycorp-profitable-at-the-mine/

"If the goal is profitability then the restructuring necessary may be dramatic. I would recommend shutting down the Mountain Pass mine"

Whereas:

"Lynas’ Gebang plant is a ground up state-of-the-art SX facility designed specifically to produce customer defined light rare earth products. The process design and the product mix were done by Rhodia, the most sophisticated and experienced REE SX designer/operator in the world. I doubt that Rhodia provided this engineering service so as to create a competitor. I also doubt that anyone with a light rare earth deposit can get the financing to build another state of the art facility of the size of Lynas Advanced Materials Plant (LAMP). The logical next step for Lynas will be to develop the Duncan deposit so it can be a HREE producer. I suspect such a facility will be more likely in Australia than Malayia, but it is years away.
I am saying specifically that LAMP has enough LREE capacity to be a safety valve for the wold’s current security of non-Chinese supply. China has a large overcapacity for LREE separation at the moment, and it is still supplying the global market. I believe that after Lynas anyone building a large capacity LREE separation plant will be doing it with the economic support of a dedicated customer, private or governmental. Because unless you capitalize security of supply (for example by a direct government subsidy such as in India) the cost of a large capacity LREE SX plant is too high to be economical, and the risk of being non-competitive due to inexperience is very high.
Molycorp can and will challenge my outsider’s analysis, but it can only be credible in this by bringing in an independent third party to assess the technology and economic viability of Project Phoenix. This is very risky for a public company, so I don’t expect it to happen. The market will judge success, as always, by profits and earnings per share."