Dedicated to news and events in the heavy rare earth elements world, from exploration to final processing and user end sale, with a healthy dose of commentary and analysis geared toward the beginning rare earth investor thrown in for free. This blog is no longer being updated but will stay up for archival purposes.

Friday, January 25, 2013

This blog journey is emphatically not over! It is continuing at a new home.

A little update for my readers.

This blog will have a new home within hours and I will copy these articles to it and get back into the writing process once again.
First couple of posts are up at the new blog, from now on please log in to this link:

http://heavyreenews.com/

A process that was so rudely interrupted by Google will not be repeated again.

I will address the issue that led to this decision one final time for those who might have
arrived late to the party.

This blogger has 3 blogs with Google Blogger, each with different issues and readership, and with some overlap- readers who look at all 3 for example. Anyway, in an effort to promote my new blog to my existing readers, who come to read what I write and sometimes check in 2 or 3 times a day to do so, I wrote a quick blurb and inserted a link
to one of my own blogs, hosted by Google Blogger, and the robot instantly deleted my blog calling it spam, I appealed this via the box that you check, and the next day I was informed that my blog in fact had been deleted and reviewed to confirm it, due to terms of service violation, spam.

In other words, by asking my existing readers to check out my new writing, I have been convicted and executed for the crime of spamming my existing readership-people who often drop by daily because they want to read my writing.

What comes next is my old southern, country boy upbringing about to come out of hiding, so I suggest that the delicate minded among you just bookmark this new link below and leave this site- Warning do not read below the link below if you are of a delicate and gentle disposition!

heavyreenews.com

Warning! Do not read below this if you are easily offended! I am not kidding, folks! I may lose readers but I have to tell the world how I feel about the way Google treated one of my blogs------

 I have decided to delete the feelings expressed earlier and decided that it is just better to move on. 

I feel much better now, really.

If I haven’t offended you too much, and after all investors/speculators/miners have to be thick-skinned as that is in the job description; I will see all of you at my new site, owned and controlled by Morongobill, soon. It won’t look as fancy as this one, at least not until I get the hang of the new software, but it will be mine, and yours, not Google’s.

Thanks for your visit, hope to see you soon at the new blog site.

MorongobillGoat

Wednesday, January 23, 2013

This blog could be shut down by Google at any time, so why waste any more time here?

I have been blogging on the Google plantation for a long time.

Recently, I made posts over at my Bighorn Whisperer and Morongobill’s Backporch blogs, where I left a link to a post at this new blog. Now understand that these are all hosted over at the Google Plantation. Unfortunately for me, the Google robot crawled over to my Bighorn Whisperer blog and instantly deleted it, saying that it was spam. I put in an appeal and still have not had my blog restored. Hence my concern for this new blog.
ScreenHunter_01 Jan. 23 08.29

Here is the exact page that I got shut down for. Please note that the same identical thing was posted over at the Backporch and that 2 year old blog didn’t get shut down:
ScreenHunter_02 Jan. 23 08.45

I have spent significant time and energy trying to get this new blog going, and to make it relevant to the rare earth discussion. I have posted almost everyday, some better than others, and all with the intent to provide some help to the new investor wanting to get involved in the rare earths.

Already in the short history of this blog, I have accomplished more personally than I did the whole 2 years I spent with my Backporch blog- I took lessons learned there, hard lessons, and applied them here at this new blog and found a subject that I have enjoyed writing about.

I will continue to write about it, just not here at the Google plantation any longer. The thought that at any second a Google robot can come in here and yank down all this hard work is too distressing a thought to linger on a second longer here on their plantation.

So that’s it. This blog here is done. I have already taken ownership of the web address:

http://heavyreenews.com/defaultsite

This will be my new home, soon I hope.

It will not look as good as this one as I am going to have to start from scratch, reinventing the wheel as it is.

But the site will be mine, all mine, and Google will not be able to cut me off at its’ robot’s whim.

One final thought however. I will leave this and the other blogs up, and will remove all Google ads, so that they can continue hosting my content for free on their site, allowing me to get some sort of last word, as there is no procedure to talk to a human about this issue.

See you at the new site soon.

Morongobill

Tuesday, January 22, 2013

For your safety, remove your hand from your wallet, drilling and mining operations are about to commence!

The above should be the boilerplate language that a small investor should be required to read before he clicks on the submit button on his online trading screen.

That’s how bad some of these so called fantastic drilling operations look to this blogger.

I am going to give you one example, which will remain anonymous. You can choose to believe me or not as I am fully confident that you will run across several similar experiences to mine as you do your due diligence.

What was that? You didn’t do any due diligence work to safeguard your capital? Man, you are looking to get fleeced, aren’t you?

Let me share a recent experience with you. An unnamed company has found a possible rare earth play- location I will leave blank, as well as the country that the junior is domiciled in. That’s legalese for whether you report your being swindled to American, Canadian or Chinese authorities.

Anyway, it is the same old story. Lots of possible mineral resources(newbies remember the lesson from yesterday) and further rounds of exploratory drilling to be done. No mention of when the next drilling would be done either. So the obvious thing to do was to dig deeper into the company website to find that information.

Here are the results of my search of the company website. Broken links to the videos and/or videos removed by the subscriber. Bad telephone number to the Investor Relations Department. The investor relations telephone number was disconnected. Links to company webpages outlining technical data about the round of drilling already done did not work. In other words, no company provided information to help an investor make a reasoned decision worked, not one iota. So the only thing left was the web and trying to call the company contact number or sending an email.

Since I had already tried the web and found little but marketing hype, I decided to try the direct phone approach. The number was to an answering service who gave me another number to call, a number not listed on the company website. A call to the number led to an unsatisfactory telephone conversation where no real information was disclosed so the call ended.

So my question to you new potential rare earth investors is are you prepared to make this kind of due diligence effort? Are you willing to go the extra mile, to go against the herd of other newbies who will jump at the drop of a hot stock tip? Are you willing to spend quality time casting your net out across the rippling web hoping to land that 4 or 5 bagger rare earth stock?

Despite what I told you above, I will also tell you that the company stock just mentioned has had a couple of run ups where serious money could have been made(or lost.) No kidding, I am talking a 3 bagger and in one day, if you jumped out in time. This is where you have to decide, just who the heck are you? Are you an investor? If so follow the steps I did above.
Are you a speculator looking for a quick buck? Then forget the above, look for the right opportunities, be aware of the overall trends, and jump in and out, before the herd does. It is almost like musical chairs- don’t be the one left standing when the music stops, as it always does.

This is an interesting dynamic that I have noticed in the world of rare earth investing/speculating. Depending on the opportunity, the potential results are polar opposites sometimes. If you follow strict investment criteria and standards, you would never touch some of these plays. But a wise reading of the mood and a good sense of market timing, could make a speculator a rare fortune,

So will you be the wallet that is drilled, or will you be the one doing the mining of the money that could be made in this current market?

It really is up to you.

Morongobill

Monday, January 21, 2013

Just like Chinese water torture; another day, another Molycorp takeover rumor. Plus insight into this blog’s future direction.

This time, I saw the link up at the Marketwatch.com Molycorp stock page. Perched right at the top of the Other News section.

Let us examine this news for a moment, okay? Clicking on the link takes you over to another
site, Benzinga, which has an article written by a staff writer that discusses the various companies that are possible takeover targets based upon chatter on the web, in other words, gossip. The article can be found here but allow me to summarize the Molycorp part
in a few words: this is a rehash of the old rumor that a car manufacturer might try a takeover to obtain a reliable supply of rare earth elements, this time reported at another blog which also rehashed the info. Also of interest is the title of that blog post,” Foreign suitors including China eye only U.S. rare earth operator.” I nearly fell out onto the floor when I read that title, I was laughing so hard. Anybody with a brain in their head knows what a crock of bullsh-t that statement is. Got to hand it to the writer though, it is catchy.

Also linked, possibly to tie in some industry legitimacy, was an article over at Rare Earth Investing News from a few days ago which brings up the reported further investment by Toyota in Matamec to gain a reliable source of rare earths for its’ manufacturing needs.
This article by Adam Currie at REIN actually was the only one that I have read which seems to be actually attempting to impart investment advice and not just spread rumors on the net.

Look, I know that I have come late to this party, but already in my short time blogging on rare earth news, I have rediscovered some old truths. One of them is that you had better have a strong nose and stomach to make it in the so called “investing business.” Now I realize some of you reading this are rolling your eyes right now, but since I am writing this mostly for the benefit of the newbies interesting in rare earths, please bear with me for a moment. Look at the big picture here. Marketwatch is huge on the internet, potentially a market maker due to their sheer size of viewership and goodwill acquired in the course of doing business. I like the site and visit it almost everyday. But this Other news section is in need of a name change to the “No Rumor is too ridiculous to mention section.” My guess is this just may be enough to drive some nervous holders of this stock over the edge causing them to dump their shares. Hopefully remaining long enough though on the various sites to click on the ads or sign up for the newsletters in gratitude for providing them with this important news that Molycorp is now a takeover target! News based on rumors, leading to more rumors and news, an endless profitable cycle for everyone but the small shareholder. End of rant.

Before I shut this down, let me explain my laughing comment earlier. If anyone seriously believes that the U.S. Government would allow this country’s only operating rare earth mine and processing facility to be sold to China, you really either need your head examined or you need to let me sell you on this absolutely fantastic multilevel marketing opportunity that I just dreamed up.

It ain’t gonna happen, no way in Hell. That was just a little over the top exuberance from a blogger who, possibly under a time deadline to get a post up for the boss, needed a catchy title and quick.

So newbie rare earth investors/speculators, you better fasten your seatbelts as there just might be lots of turbulence ahead. But stick with your journey and with this blog, and together we will try to separate facts from road apples, hopefully making some money together in the process, or at least not losing our shirts falling for all the scams and pitfalls that abound in the business.
Late addition for new investors only. Here is a preview of a future post here but for now I am talking about Molycorp(MCP) ONLY. For your information, Molycorp has just announced a verified 36% rise in its’ proven reserves. You will see a lot of junior exploration companies touting their reported mineral resources in their documentation online. I won’t go into detail right now(after all I would like you to come back again- I know just like the others!) but putting it very simply, reserves are like money in the bank and resources are like the proverbial “bird in hand” or as we used to say back home in the red clay state of Georgia, wishing in one hand and you know what in the other.

So in the future we will examine junior rare earth plays carefully, digging for and opening up all those oysters and maybe we will find that pearl that might turn out to be the next Molycorp
or at least develop their mine and bring it into production, and providing a decent return to the investors.

Let’s meet again soon for more rare earth news and views, possibly from an earthier perspective than you find on all those other financial sites, as it happens.

Thought for the day: Step back from your computer screen and smell the lanthanides!

Please note that this blogger may or may not acquire a stock position in MCP or any other stock, and all opinions expressed are just that, his opinions, worth as much or as less as any other talking head’s. This blogger is not a registered financial analyst or broker, and has no intention of becoming one in the future, nor is he a mining expert or claim to have any expertise in the area.

Morongobill

Friday, January 18, 2013

Courtship over, it’s time for Jamaica and Japan’s Nippon Light Metal Company to consummate their new relationship. WARNING! No public displays of affection, not with a jealous China observing nearby.

Yes, I know that is not your typical stodgy article title that one gets used to in financial or industrial news blogs, but then, this is not your typical expert doing the blogging either.
I am sure you readers know more about the rare earths world than I ever will, my sole
contribution is to provide context from a different viewpoint; from that of an outsider, some
might even say from a neophyte’s perspective.

Hence this post today, which due to the news cycles, follows yesterday’s post regarding another Japanese effort to provide rare earth resources to its’ manufacturing base- anything
to break the Chinese monopoly on the rare earths’ is evidently fair game to the Japanese. Seen today in light of this news, advice regarding Bokan and Japan being a good match
probably fell upon deaf ears in Tokyo.

First some history. Jamaica was mined for bauxite decades ago and “red earth deposits” were left behind, red mud evidently loaded with rare earth elements. There was a half hearted attempt made some years ago by the government to study ways to bring this to market but it went nowhere.

Let me interject a fact here that some of you may not know. China’s rare earth deposits are overwhelmingly found in clay(or mud if you like) so they know a little bit about bringing them to market, though perhaps not so much in an environmentally friendly way as in the west.

Getting back to the matter at hand, it has been announced here, here, here and editorialized about here. Jamaica’s Minister of Science, Technology, Energy & Mining: Phillip Paulwell
announced that Nippon Light Metal Company will invest 3 million US$ providing the buildings, equipment, technology and expertise-and bearing the operating costs of the enterprize, and in return NLMC and the Jamaican government will split the revenues equally.

So what, one might ask? Years ago they took all the aluminum ore and left behind all this worthless red mud, what good is it? Turns out this worthless red mud may hold enough ree’s to extract about 1,500 metric tons a year which if conservatively valued at $1,000 a ton is worth an astronomical $1.5 BILLION a year to an island about 4,000 square miles in size with around 2 1/2 million residents.

So this is a big deal, a momentous deal for such a small country in the middle of the Caribbean. And for the current government. A deal that directly affects its’ powerful supporter and patron- China. A deal that puts this little island smack dab in the middle of one of the most intense geopolitical and economic rivalries on the whole planet. And a deal involving rare earths, China’s ace in the whole for dealing with its’ old historical rival, Japan.
So to paraphrase the editorial from the local paper, Jamaica has to tread carefully and as the title of this blog posts suggests, not act as if they are too deeply in the clutches of China’s main enemy rival, Japan. So again, I warn Jamaica’s rulers, no public snuggling or cooing with Japan, or you may wake up and discover that your main patron has turned against you.

Take this to the bank. You don’t want China for an enemy. They have long memories over in Beijing and know how to play the game using western methods. If you hear crackling sounds, that could be the ice beginning to go out under your feet, so tread lightly with this.

As far as the deal itself, it’s fantastic news. My bet is that this will be a money maker and that the plant and processing will be done in an environmentally friendly manner- it has to be, this island is too small and I am sure that folks will be watching to see how things are done and according to plan.

This project has two problems as I see it. First, the government has to walk a tightrope for geopolitical, finance and environmental reasons with this project, and secondly it has to deal with the fact that China currently controls the rare earth supply and price. That is what happens when you supply over 90% of the world’s supply of these and other required industrial metals.

It is a stroke of luck though that this project is beginning while China is involved in an internal struggle to reign in its’ domestic miners and to start a cleanup effort of some of the worst hit areas where the main ree mining occurred. Consequently the Chinese are having to reduce their exports of rare earth elements and, in fact, are building up their own domestic stockpile against the future day when their supply drops, which has led to a firming up recently in some of the commodity pricing.

In closing, I wish NLMC and the Jamaican government and people good luck with this red mud project and with the hope that they don’t inadvertently sling any of it into the face of their main patron, China.

Please note that this blogger may or may not acquire a stock position in Nippon Light Metal Company Ltd or any other stock, and all opinions expressed are just that, his opinions, worth as much or as less as any other talking head’s. This blogger is not a registered financial analyst or broker, and has no intention of becoming one in the future, nor is he a mining expert or claim to have any expertise in the area.

William McDonald



Thursday, January 17, 2013

Here is a way that Japan can save a lot of money, avoid damaging the seabed and wrap up a Dysprosium supply.

Reports are up on the net lately that Japan is about to launch a study of the seabed
about 2,000 kilometers east of Okinawa and at a depth of over 5,000 meters below the ocean surface. This would be one of the most ambitious mining attempts in history, in search of rare earth elements including Dysprosium, as well as being probably one of the most technologically challenging mines in history.

There are reliable estimates of at least a 400 year domestic needs supply of Dysprosium  in a one thousand square mile section along with other ree’s which has got the manufacturers’ hopes up of finally breaking the Chinese stranglehold upon the ree’s that Japanese industry needs.

It goes without saying that such an effort to bring an underwater mine operation such as this to commercial production would involve a national commitment, an extremely expensive proposition for a country which has been in a twenty year period of economic stagnation and is simultaneously attempting to deal with the exceedingly costly Fukushima nuclear cleanup
and a switch to alternative energy sources such as wind and solar.

Considering all the environmental consequences and bad public relations from the nuclear reactor meltdown, do the Japanese really want to undertake such a massive undertaking as the proposed deep ocean mining of the seabed with all the possible negative environmental
consequences that could ensue?

May this blogger alter a cheaper and less risky alternative? Here in the United States, your closest ally and largest customer for your manufactured products, lies Bokan Mountain in our
mining friendly state of Alaska. It is reputed by Ucore that Bokan Mountain and Dotson Ridge in particular, hold ore bearing veins rich in Dysprosium and other rare earth elements, just sitting there waiting to be mined and processed, and with deep water access nearby for the loading of cargo ships to bring the rare earth metal home to Japan.

By all means, conduct your study of the ocean floor and perhaps even begin the undertaking. I am suggesting that you hedge your bets by taking on a position with Ucore such as Toyota has with Matamec, support further exploratory and other drilling studies with Ucore, in return for future shares of the rare earth elements mined and processed.

Evidently there is reportedly enough Dysprosium there at Bokan to supply not only your needs but U.S. manufacturers as well.

Here are the links to articles used in writing this post:

Friday, Jan. 11, 2013 Japan to study seabed for rare earths

US Department of Energy Shifts Focus to Rare Earths

Underwater Rare Earth Discovery: Game Changer or Pipe Dream?

Sea holds treasure trove of rare-earth elements, Survey reveals wealth of important metals in ocean floor mud.

Tokyo University team claims 6.8m tonne Japanese REE discovery

Please note that this blogger may or may not acquire a stock position in UURAF or any other stock, and all opinions expressed are just that, his opinions, worth as much or as less as any other talking head’s. This blogger is not a registered financial analyst or broker, and has no intention of becoming one in the future, nor is he a mining expert or claim to have any expertise in the area.

William McDonald

Wednesday, January 16, 2013

Perhaps it is time to quit bashing Molycorp and to breathe in the fresh scent of the lanthanides.

It seems to be the “in” thing in the “investment community” to gang up on Molycorp right now. No matter where you surf to for “investment advice,” you seem to find articles knocking this stock, this company and its’ plans to bring rare earth elements mining and processing back to the western hemisphere. A perfect example can be found here, albeit with a more respectful tone than most.

This blogger agrees that the company has had some problems with the implementation of the
Phoenix Project, but after all, we are talking about a billion dollar crash investment and building program. Yes, there are also questions about disclosure and reported troubles with a contractor, but again, we are talking a major campaign here to develop the most environmentally friendly and cost effective, state of the art rare earth processing facility on the planet!
12042012sodamtncrrem 012

Can we give Molycorp management a break from all the backstabbing for just a little bit? Perhaps even step back to better take in the view of what all has been accomplished at Mountain Pass and other facilities worldwide by Molycorp, and breathe in the scent of the lanthanides?

The giant mining pit at Mountain Pass is perhaps the key to a continued meaningful American manufacturing industry. We are in a new economy, a green economy, and one that we are rapidly losing ground to the rest of the world in. Our hopes to catch up in some ways depend on what happens out west at this mining facility in the Mojave Desert.

Virtually everything made nowadays in the information age contains lanthanides, rare earth elements, from the phosphors used in our computer and television screens to components in our smart phones. These products mined and processed by Molycorp here and at other locations such as Estonia, are vitally needed by the most advanced industrial manufacturers
such as Siemens and Boeing, among others too numerous to mention- and a reliable and reasonably priced source is absolutely critical for them as well as for our defense industry. It can be argued that this facility is vital to the national interests for our nation; some might even say that as Molycorp’s future goes, so does the United States’ as well.

Another thing not mentioned by the doom and gloom folks, is just how environmentally friendly the new ore processing facility is and just how cheaply it all can be done.
They never mention the fact that Molycorp has their own natural gas electric generation
station providing them with all the power required by the state of the art processing facility,
at a 3 cent per kilowatt cost! It is also rarely mentioned that net water loss in the processing of the ore is effectively zero compared to the old days when it ran about 800 gallons per minute being drained off to the dry lakebed miles away. This is an
astounding accomplishment, one that they deserve to be praised for. And for your information, this writer has blogged extensively for two years on behalf of the Mojave, at my old blog, so I feel that I am in a position to know enough to form a reasoned opinion on this subject.

Did I mention that there are no more tailings piles? It is a common sight in the Mojave, which by the way has been extensively mined in its’ history, to see tailings piles everywhere. Not anymore, at least not at the Mountain Pass facility. Simply put, the ore dug out of that giant pit is crushed, separated, processed with water and acids, the rare earth elements are taken out and the remaining slurry has the water and such removed, leaving a paste which is mixed with concrete and spread out in a designated area- no more worries about chemicals leaching into the ground.

What does all this mean? Per the company, they claim that their finished products will cost less to produce than anywhere in the world, including China. Now you may not have heard about the situation in China and Inner Mongolia where they mine most of their lanthanides, it
is an environmental disaster already happening and it has gotten so bad that the government is now forcing some of the companies out of business over there. People are getting sick and dying off, and it is a problem that must be cleaned up or else. China has a unique geological situation with their rare earth elements mostly found in clays, which can be easily washed out with acids, and this had led to the proliferation of “mom and pop” style
mining concerns that have mined the land for the profitable minerals and along with the giant mining operations, wrecked their land and water environment.

So as events play out in the Far East, Molycorp will be profitably and safely processing their now 36 % enhanced mineral reserves as recalculated recently. It would be nice, but probably expecting too much, if investors recognized that fact by placing their confidence more in the company management than in all the nattering
nabobs of negativity found in the so called “investment community.”

Please note that this blogger may or may not acquire a stock position in MCP or any other stock, and all opinions expressed are just that, his opinions, worth as much or as less as any other talking head’s. This blogger is not a registered financial analyst or broker, and has no intention of becoming one in the future, nor is he a mining expert or claim to have any expertise in the area.

William McDonald

Monday, January 14, 2013

Open letter to Chairman Bhappu, Interim President Karayannopoulos and the Molycorp Board of Directors regarding the potential takeover of your company.

Good morning gentleman,

Just a quick letter here from a long time admirer of your company and potential stock purchaser. In addition, I also write this little blog that this open letter to you is being posted at.

For the last couple of weeks or so, rumors have been swirling all around the investment and mining communities and blogosphere that Molycorp is in danger of being taken over by
others- from manufacturing concerns looking for a sure supply of the rare earths that they need, to private equity firms possibly looking to Bain the company, parting it out after the takeover.

There are others writing about this possibility that are more knowledgeable in these areas, I defer to their judgment on this matter.

Recently, I wrote a couple of posts advising you to firm up the long term leadership for Molycorp by signing Mr. Karayannopoulos up for the far future with a new contract. I stand by that little piece of advice.

Now I would like to give you some more unsolicited advice. Please take it in the spirit that it is offered.

Several reports have mentioned that your firm is missing heavy rare earth elements at your
Mountain Pass property. Some even opine that this lack could directly have an effect in a
possible future takeover battle, should someone decide to mount an attempt based upon your current and near term stock valuation.

I have also thought the same thing and have finally decided to reach out to you and offer what I feel might be a step in the right direction; a strategic move by you which will pay off long term though perhaps not offering much help at this very instance when rumors
appear to seem to be coalescing into a good chance of gaining some substance in the form of an acquisition campaign.

Right across the valley from your Mountain Pass property, about 16 miles via good roads, lies a historic mining district in the state of Nevada- a state that welcomes your industry. In that area are thousands of acres of government land whose leases are 100% controlled by
a Canadian firm, Elissa Resources, run by Paul McKenzie. This land has had the first round of drilling surveys done and it appears to have a treasure trove of heavy rare earth elements, all to be had right next door to you.

From my conversation with that company via a high placed source recently, they may or may not do the second round of exploratory drilling and surveys in 2013. Who knows the reason for the delay: waiting for ore prices to go up, hanging onto the cash on hand, etc. I do know this based on their previous actions- they will get the money to do this via stock offering which will have the effect of diluting the previous shares out there.

This is where you step in.

I suggest that in the same manner that Toyotsu inked the deal too help Matamec Explorations as was reported today, that Molycorp step in and offer funding for the second round of drilling, along with making a commitment to either buy out the company upon receipt of a good drilling report or contract to do the mining and processing of the ore with royalties paid to Elissa and the shareholders.

It seems to me that a deal such as this one would be the last missing piece of the puzzle that
Molycorp has been putting together, and acquisition of the Thor REE play and its’ potential treasure chest of heavy rare earth elements could be just what the doctor ordered for Molycorp to further cement its’ hold on the market begun with its’ “mine to magnets” program.

Thank you for listening to my thoughts and best wishes in the struggles to come.

Please note that this blogger may or may not acquire a stock position in MCP, ELSR, ELI or any other stock, and all opinions expressed are just that, his opinions, worth as much or as less as any other talking head’s. This blogger is not a registered financial analyst or broker, and has no intention of becoming one in the future, nor is he a mining expert or claim to have any expertise in the area.

William McDonald

Sunday, January 13, 2013

Swinging the virtual pickax in the rare earth mine is hard work but somebody has got to do it!

Today, it being the weekend and all, I decided to do something a little different and tell you
about your host here on this isolated little patch of virtual dirt in the internet
wilderness that is alleged to have some kernels of wisdom available provided that one is willing to wade through all the muck to find them.

Your host is a 58 year old and not necessarily wiser man residing in southern California for the last 36 years, having moved out here from a tiny city in Georgia. I have worked in many fields, from gas stations to sitting on the foreign currency trading desk for a major bank at the corporate headquarters in Los Angeles- some might say a jack of all trades, having certainly mastered only one or two. Writing is obviously a field that I have not mastered, but then I don’t claim to be the next coming of James Clavell either.

I have been on the net as a blogger for a couple of years, mostly using the pseudonym of
Morongobill, writing many posts on saving the desert from renewable energy development. Some might note the irony of my writing this blog now devoted to heavy(and light) rare earth element news. In fact, I just received an email from another blogger who
pointed that out to me and told me to expect cries of Judas being aimed in my direction. I
admit that is a possibility but as I mentioned in my reply to the blogger, until I come out of the
closet with an endorsement of a particular project in a sensitive area, there are no specifics to cite, only a feeling.

Since I feel a need to explain myself to you, my new readers here at this itsy bitsy flea riding on the back of the Seeking Alpha’s and Mining News’ of the net world, let me just say that I don’t really see any irony at all in my position on mining in the desert- I have always noted that the Mojave Desert was mined in its’ history and one of my favorite places on this planet is the Mojave National Preserve, which also has mines. My main concern is that somebody take responsibility and cleanup after themselves, and not site them in wilderness.

The establishment of gigantic wind and solar farms upon virgin desert wilderness is another kettle of fish altogether, and totally unnecessary due to all the rooftops available as well as degraded lands close to the users- my position on that is clear and consistent, and unwavering.

But “desert activism” is a tough row to hoe out in that hot desert sun, especially when you keep seeing those giant suv’s racing past you, tinted windows up to keep all that cool air inside, bearing the BrightSource Energy or First Solar logos, rushing off to their next preapproved by the federal and state bureaucracies desert wilderness site that they plan to pave over; leaving you and your fellow desert lovers behind to bemoan the loss of the land that you love, which is about all that you can do when you see the major environmental and conservation groups rivaling each other in seeing who can suck up the best to the man, in
sacrificing the nature that their charter’s pledge them to preserving.

So I hopped off the train with my virtual hobo gear in hand looking for a field that I could learn and tell others about, to reinvent myself as so many others in the real and virtual worlds
have done, and perhaps even to make a couple of dollars at some point soon as I position myself for the glue factory that I may end up at when this journey reaches its’ end one day, just so long as that final destination comes much later rather than sooner Winking smile

To that end, I welcome you to my little corner on the wild, wild web and hope to see you again. I would also like to ask you to visit my sponsors on this site, if they are offering a product or service that you might be interested in. As the old saying goes, every little bit helps. There are some reports and services that will be needed in the future at this blog and
any revenues coming in will go to pay for it.

I would also like to send out a call for rare earth plays(stocks.) In particular, junior exploration companies that might have potential commercial quantities of heavy ree’s. Please leave a comment with the stock ticker, etc or feel free to email me the details if you prefer not to go the public route. Comments are moderated by me, mainly to keep out all the spammers offering x-x-x garbage, and not for suppressing contrary opinions.

So in a nutshell, keep reading this blog if you like it, help enhance the discussion by participating, and support the site by checking out the sponsors if they offer you something that you are interested in- and I will keep providing content that you might or might not be interested in, as well as analysis from my point of view, of the rare earth markets.

I hope to see you here again soon.

William McDonald

Saturday, January 12, 2013

Weekend update to my recent post directed at the Molycorp board in support of Mr. Kayarannopoulos.

Molycorp stock(MCP) seems to have settled at around $8.50 or so, but who knows what will happen on Monday? I think that it will trade sideways in this level for a while, possibly waiting for another investment bank to drop the other shoe and follow up on J.P Morgan’s gutting of the stock the other day, by issuing another downgrade or lower price target.

Just remember what I said the other day about buzzards soaring in circles in the sky above
the Mountain Pass facility and the corporate headquarters in Colorado.

But that’s just this bloggers opinion, the market’s along with yours may differ.

I find it instructive however that a friend who has started rare earth investing considered this as a buying opportunity and has an order to buy more shares, if it drops to the $8.30 level I believe he said.

I can’t help but wonder if any hedge or stock funds out there following a value stock strategy might be thinking the same thing, or will the shorts prevail and drive the stock even lower, allowing the value guys to keep sitting on their piles of cash hoping for another plunge and an even better buying price point.

For me personally, two things stand out about this event the other day. One was the news that Mr. Kayarannopoulos took the job as interim CEO expecting to leave the first quarter of 2013; that was a total surprise to this blogger who expected a long term stay, and second was the masterful way that he handled the reporter’s questions which indicated to me that he definitely is the man for the job of saving Molycorp.
read this for the exact questions and answers

It appears to me that he expected a transition to new leadership to go smoothly and may have been blindsided by these developments. If so, he handled it well. Now that the full scope of the problem is becoming more and more obvious, thanks to a review of the new production schedules that he put in place; he said in the interview that his tenure will now be measured in, paraphrasing, quarters not months. He also made this statement which I found refreshing in these times of corporate politically correct speech, when asked about length of tenure, he replied”What I'd like to do is hand the company to whoever comes in after me without any baggage, there are a few problems, like all companies have, and I'll deal with them.”

The rest of the article discusses the way that Molycorp is approaching the ramp up in production and an analyst’s reaction to the timing. Left unsaid was the market’s overwrought
response to the news leading to the stock’s demise.

I standby what I wrote the other day and still feel that the board needs to tie this executive up for years to come by making him a deal to stay on and handle the helm in the tumultuous times ahead for Molycorp. In fact, I believe that institutional investors should be applying the old “squeeze play” to directors and the chairman right now, this weekend. It appears that Mr. K might want to move on, but sometimes a lot more money and spiffs combined with an old
fashioned appeal to stick it out and fix the problems now thus leaving a legacy behind, just might work.

It definitely should be considered by the board, and by the large stockholders involved. 

I would also like to provide you with another way of looking at this from a contributing writer over at Seeking Alpha whose pseudonym is Shock Exchange. He likes the stock but is waiting for the right time to buy. He points out in this article that “unusually high volume presaged Molycorp’s 23% plunge, who knew something?” Wouldn’t it be something if a SEC investigation ensued and real legal fallout hit somebody or some firm involved in possibly running this stock into the ground and destroying a whole lot of shareholder wealth?

I won’t hold my breath though waiting for the SEC to step up to the plate as they might step on some important political campaign contributor’s corns.

In the grand scheme of things, this could all be part of a general retrenchment in the rare earth markets and we may just have to wait for the “rare earth dust” to settle. But in the meantime, this blogger would feel a lot better about Molycorp’s future prospects if Mr. K was made the right offer, and the sooner, the better.

Please note that this blogger may or may not acquire a position in Molycorp(MCP) or any stock, and all opinions expressed are just that, his opinions, worth as much or as less as any Wall Street talking head’s. This blogger is not a registered financial analyst or broker, and has no intention of becoming one in the future, nor is he a mining expert or claim to have any expertise in the area.

William McDonald

 

Thursday, January 10, 2013

Time for the Molycorp board to take a stand and remove the “interim” from Constantine Karayannopoulos’s job titles.

As I type this out on my laptop, the stock ticker says the stock is down 20.9% or $2.26 to $8.53 with almost 32,000,000 shares traded- huge volume at lunchtime for this stock and several more trading hours ahead!
(actually 22.06% at $8.41 as I proofread this before posting)

Molycorp announced that 2013 revenue and cash flow would be short of goal and the stock plummeted almost 19% at the opening bell. I guess shareholders are lucky that the bloodbath
hasn’t been worse, but after all there are more trading hours to go. Then J.P. Morgan applied the Coup de grâce by reiterating its’ UNDERWEIGHT rating and lowered its’ price target for Molycorp stock to $5! Talk about filleting a good company, they gutted it!

If I was Ross Bhappu, I would be burning up the phone right now doing whatever it took to get the board behind the announcement that effective immediately, Mr. Karayannopoulos is the choice in these rough times for the rare earth industry and the global economy to lead and guide this company through this turbulence and for years to come. In other words, I would bet the farm on Mr. Karayannopoulos. I would do it right now to stop the bleeding away of the share value and to buck up employees and shareholders to stick with the company and its’ plans. With the vultures of Wall Street circling overhead in the thermals above Mountain Pass and Colorado, now is the time for concrete action, which might have an effect upon potential corporate raiders who surely must have their blood up this morning watching the ongoing carnage in the market.

I believe in this company and its’ story. It took guts and hard work to buck the trends and sell investors on funding Project Phoenix, and to reopen Mountain Pass. And it is going to take guts, starting with the Board of Directors and senior management, to fend off any attacks against the company and to re-instill a belief in the company, after the recent departure of Mark Smith and a new CEO coming in on an interim basis.

Some opined that the recent flurry of reports regarding a corporate takeover by Nissan, etc was just so much blather. After the events of this morning, I am not so sure. Think about it folks- if this goes back down to the $5-6 range like Morgan analysts suggest, this stock would be like catnip to someone like Pickens or Icahn- and to an automobile manufacturer that might like to guarantee its’ rare earth components availability, at an attractive price.

The market is going to do what it will do. We can’t stop it. But Mr. Bhappu and the board can do something to help alleviate the crisis in investor(and market) confidence.

Mr. Bhappu, please make the call. Announce that the Board of Directors has elevated Mr. Karayannopoulos to permanent President and CEO effective now with the board’s and your full confidence with the power to run the company to achieve its’ and the investor’s goals, which is to be a pre-eminent vertical supplier and producer of rare earth elements in the world.

Some will say that this might indicate a degree of panic in the boardroom if these actions that I am advocating for were followed. My answer to that is when someone cuts your throat
you don’t sit there thinking things will get better, you get someone to sew you back up. Right away, times a wasting as they say.

Please note that this blogger may or may not acquire a position in Molycorp(MCP) or any stock, and all opinions expressed are just that, his opinions, worth as much or as less as any Wall Street talking head’s. This blogger is not a registered financial analyst or broker, and has no intention of becoming one in the future, nor is he a mining expert or claim to have any expertise in the area.

William McDonald

Wednesday, January 9, 2013

Thorium -the next major energy source- at least China and India think so and are betting the farm on it.

Of course some of you may be aware that the first Thorium based reactor was built right here in the U.S.A. back in the 50’s at Oak Ridge, but that was scuttled mainly due to the desire by our military for weapons grade nuclear material for bombs, which was produced as a by product from the uranium based reactor technology also being considered; that technological approach won out and the Thorium project at Oak Ridge had the plug pulled.
File:Thorium reactor ORNL.jpg
"Image courtesy of Oak Ridge National Laboratory".

We know the rest of the story now. After decades of operation, holding ponds all over the nation and the world are filled with smoking radioactive material that must be kept cool and eventually disposed of, lots of atomic bombs all over, and a still smoking and melted down reactor in Japan- all important problems with no easy solution at hand.

Yet our civilization requires energy and the fossil fuels that it has relied upon for over a century are running out, and replacing that energy source is now a priority for governments worldwide before the easily accessible supply dries up and in turn drives the prices for the remainder sky high. This need for a different energy source has in turn spawned a new industry devoted to renewable energy, mainly in the guise of solar panels and wind turbines.

The dirty little secret though regarding the latter is that it will destroy the planet in order to save it, at least as it is implemented in this country. It has been the policy under the current and previous administrations to site these giant solar and wind farms upon cheap federal land, and usually in pristine desert wilderness, in the case of solar. This has led to opposition from those who favor keeping wilderness wild and led to splits within the environmental movement.

There may be an alternative power source available however; a return to the previously mentioned old but tried technology spiffed up with new approaches to making it work, I am talking about Thorium nuclear power. Nuclear power in this country is a four letter word better left unsaid in genteel society but I will breach the subject anyway. Might as well, because China and India are going full speed ahead to make Thorium nuclear plants a reality, whether we here in America approve of the concept or not.

India has been working with Thorium technology for years, but it seems to me that the country to watch is China. That country has a manufacturing base to maintain and is farther along in the development of a new consumer society so a supply of cheap electricity must be found to replace the coal based electricity that they depend upon now. To that end,
China has embarked upon a renewables approach involving wind(which could mean more Neodymium and Dysprosium sales by somebody) primarily, as well as plans to develop at least 100 new “old style” fission Uranium based nuclear reactors- and is in the beginning (as in running off with the prize) stages of a major push to bring Thorium fueled reactors online. This effort will be the subject of this post today.

Chinese officials say that they have enough Thorium to provide electricity for 20,000 years.
You talk about the Holy Grail of cheap power production! So with the help of highly connected(as in the son of the former leader of the country) people working with the Shanghai Institute of Nuclear and Applied Physics and The National(Chinese) Academy of
Sciences, along with 140 PHD’s initially and a budget of a third of a billion dollars; the plan is to have a working small Thorium reactor by the end of this decade, and large ones by the 2020’s- I, for one, would not bet against them.

Thorium is an element that is more abundant than Uranium in nature and is often found along with REE finds. It also can be used to “burn up existing hot nuclear wastes and plutonium.” You recall the controversial Yucca Mountain storage project in Nevada, such a plan would never have come up if we had Thorium reactors in place to dispose of that waste.
Actually we wouldn’t have hardly any waste to dispose of, period, if we had gone the Thorium route at the beginning- as it is used up more in the energy process and what is left behind is less radioactive vs today’s waste and stays hot for hundreds instead of many thousands of years. In other words, a win-win at least to the Chinese energy establishment and government officials involved.

Another bright spot with using liquid Thorium fuel is that the process occurs at atmospheric pressures, no obscenely expensive and huge concrete containment dome required! This is achieved by using molten salt as the liquid heated up to drive the turbines that produce the electricity. No worries about a Fukushima type meltdown as if it overheats, a salt plug melts at the bottom of the tank and the solution drains out and Thorium stops reacting almost instantly when the neutron source used to “ignite it is shut off.” I am oversimplifying here because unfortunately I do not have  PHD attached to my name, unless it is meant in the sense of piling it high and deepWinking smile You can read all the technical details to your heart’s content at this link below:
http://en.wikipedia.org/wiki/Thorium

I may have unintentionally mislead readers earlier by mentioning only the Chinese “Manhattan Style” Thorium project. I would be remiss if I didn’t point out that per the
Wikipedia article link directly above, India will have a 300 Megawatt reactor fueled solely by Thorium fuel online by the end of this year. In fact, they believe that Thorium will meet 30% of the subcontinent’s electricity needs by 2050. In addition, Germany has a Thorium reactor already up and another in the U.S. should be up within a couple of years as well.

So the future is bright for Thorium based nuclear reactors. Now I know that statement will dismay some of my readers, so allow me to expand the topic by bringing the current fad, the Green Energy movement, back into the conversation.

For many in this movement, progress will be measured by how many giant solar farms and wind farms will be built across hill and dale and even out to sea. Unfortunately it is a fact that a whole lot of fossil fuels will be expended to build out all the infrastructure to be put in place and from things I have read, renewable energy is not enough to power all the blast furnace needs among other uses to build this, no matter where it ends up being sited. So there won’t be enough solar panels and turbines available to kickstart it, we will just have to burn the fuels anyway or fire up the nukes to get the job done of building the millions of panels and turbines required.

And do we really want to live in a world where virtually every scenic view is marred by the sight of 40 story tall giant windmills or square mile after square mile of mind numbing black solar panels extending out to the far horizon? I don’t, and I don’t buy into the notion that we must destroy the wilderness in order to save the planet.

So what can we do about it? I think we should see what happens with the Thorium projects going on right now in the rest of the world. We don’t need any more dirty reactors or Plutonium for bombs, but we do need energy for our civilization as it exists right now. What will it matter in the grand scheme of things if we slow down the rush to pave over our last wilderness, when we can give this Thorium technology a chance to grow up out of the infant stage.

I just don’t buy into this argument that the end of the world from climate change is tomorrow, no matter what the talking heads say. This earth has been here for billions of years and things move in geologic time. Our time as humans on this planet is just a blink of a geologic eye, and we should not be so full of ourselves as to believe that only we, right at this very moment, have the answer and that answer is to finish the rape of the planet by destroying what beauty is left by planting wind turbines and other things in almost every square mile that is left.

This Thorium revolution has the potential due to its’ scaleable sizing capabilities and the safety of the process to achieve true local distributed power generation for small to large communities; the Chinese are even talking about using a power station sized to provide all the electrical needs for a steel mill as an example- a process that requires dirty coal generated power at present pumping who knows how many millions of tons of CO2 in the atmosphere.

I wholeheartedly believe that America is missing the boat here by not considering Thorium as
a way to help build up our national energy infrastructure and letting India, China and others lead the way to the future.

Here are other links to articles read for this post:
http://www.smartplanet.com/blog/intelligent-energy/why-safe-nuclear-will-rely-on-rare-earth-minerals/11328?tag=search-river

http://en.wikipedia.org/wiki/Thorium-based_nuclear_power

http://agmetalminer.com/2013/01/08/is-thorium-the-fuel-of-the-future/

http://agmetalminer.com/2013/01/08/china-needs-thorium-reactors-to-quench-its-thirst-for-energy/

http://agmetalminer.com/2013/01/08/cons-of-thorium-reactors-shouldnt-stop-future-development/

Please note that this blogger may or may not acquire a position in any stock, and all opinions expressed are just that, his opinions, worth as much or as less as any Wall Street talking head’s. This blogger is not a registered financial analyst or broker, and has no intention of becoming one in the future, nor is he a mining expert or claim to have any expertise in the area.

William McDonald

 

 

 

 

Jack Lifton video series on Ucore’s Bokan Mountain Project

What the heck, might as well up all the videos where the Bokan Project is discussed. If you view all 14 11 of these short videos, you will have an overall understanding why this project is not only important for the future of Ucore but for this nation as well.

Dysprosium: A Most Critical & Most Threatened Metal to the U.S.

Jack Lifton - Vancouver 2011

Dysprosium & Other HREE's: Essential to the U.S. Military

Jack Lifton - Vancouver 2011

Dysprosium: Essential to U.S. Auto Industry

Jack Lifton - Vancouver 2011

Dysprosium: A “Permanent” Rare Metal for US

Jack Lifton - Vancouver 2011

Bokan vs. Mountain Pass: Heavy REE’s vs. Light REE’s

Jack Lifton - Vancouver 2011

Bokan Heavy REE’s:America’s Most Accessible Solution
Bokan Heavy REE’s:America’s Least Cost Solution
Bokan Heavy REE’s:Right Size for U.S. Economy
Bokan Heavy REE’s:Ability to Sell All Output
Bokan Heavy REE’s:Ability to Sell Surplus to Asia
Bokan Heavy REE’s:America’s Fastest Crisis Solution
Bokan Heavy REE’s:America’s Sole Crisis Solution

Bokan Mountain is the “Goldilocks solution” to the U.S. Dysprosium strategic needs. Just the right size for our needs.

China vs. US: Heavy REE’s as a Competitive Battleground

China’s Emerging Consumer Economy: Where does this leave the U.S.?

Ketchikan destined to be the location of the only HEAVY rare earth vertically integrated supplier and producer- the answer to Molycorp Mountain Pass from a heavy perspective?

The title provided by Vimeo suggests that there are 14 videos but I went through their page and at Ucore TV and only found 11. Note there are more videos available at Ucore's Vimeo Page and on Youtube.

I recommend that you watch all the videos on this page. Relax, they are enjoyable to watch, no kidding.

Please note that this blogger may or may not acquire a position in Ucore(UURAF) or any stock, and all opinions expressed are just that, his opinions, worth as much or as less as any Wall Street talking head’s. This blogger is not a registered financial analyst or broker, and has no intention of becoming one in the future, nor is he a mining expert or claim to have any expertise in the area.

William McDonald

Tuesday, January 8, 2013

Here is HOW NOT TO INVEST in Rare Earths!

This is from the: “I can not believe that someone can be that dumb file.”

Rare metals: Beware the scam call that could cost you the earth

Go ahead and read that and then come back here for some “I guar-damn-tee I am qualified to give it” commentary.

Decades ago when I was a young man and looking for a job, any job, I got involved in the investment telemarketing boiler room cold calling business. I sold everything from oil and gas leases on federal land to shares in drilling ventures- aptly named it turned out due to the only drilling being done was into the prospect’s mark’s checkbook. I would work at one making a little money to pay rent, discover that it was a scam, and then move on. I did this for about a year and barely held on to my fiscal and ethical condition. I guess that I didn’t learn too good in those years; it took a while to sink in, that everyone of the deals was crooked- and I finally walked out, never to return to that world.

So I feel that perhaps I am uniquely qualified to comment on this new scam over in England: one that is probably headed here to the colonies.

These deals are scams, no doubt about it. First, the average person wouldn’t want to own a whole bunch of rare earth material, where would you put it? Second, these deals always feature an obscenely bloated price, always! That’s how you pay the astronomical phone bills, and for the expensive “mooches” leads, and the fancy offices and the high commissions paid out to the “heavy hitters” for opening their rolodex’s and calling their own private mooch list; plus the fancy luxury cars that the boiler room operator rides around in. I am sure that I am forgetting things such as the expensive spiffs they toss out to the sales force to bring the deals in and the huge Fedex bill for having them go out and pick up the check, right after the mark gets off the phone- before they change their mind and also avoiding a charge of mail fraud which carries a stiff prison sentence for the boiler room operator.

There are always hucksters looking to ride the next wave and evidently rare earths are no different. What the scammer’s mind can achieve, a gullible rube will always believe!

I am not an investment analyst or stock broker and do not give investment advice. However, I will say that I think you have a better chance of making money with rare earths by investing in shares of companies that are mining, or producing, or exploring for them. Real people with real jobs working for real companies, getting some of that real rare earth right under their fingernails.

That is what this blogger suggests that you look into if you feel the urge to invest in rare earth elements.

Please note that this blogger may or may not acquire a stock position in any stock, and all opinions expressed are just that, his opinions, worth as much or as less as any Wall Street talking head’s. This blogger is not a registered financial analyst or broker, and has no intention of becoming one in the future, nor is he a mining expert or claim to have any expertise in the area.

William McDonald