Bokan mine development slowed as rare earth prices dip
Development of the Bokan Mountain rare earth mine is on hold as the company leading the project focuses on a new processing technology and waits for rare earth metal prices to rebound.
Nova Scotia-based Ucore Rare Metals Inc. finished infill drilling and drilled groundwater monitoring wells in 2014, leaving it at a natural stopping point before moving towards the next steps of development.
Ucore Vice President Randy MacGillivray said in an interview the company has delineated a resource of approximately 5 million tons that is 0.65 percent total rare earth metals.
Bokan, located on the southern part of Prince of Wales Island in Southeast, would be an underground mine.
Rare earth metals are used in small amounts in countless technology applications. Their prices have softened in recent years along with other, more well known metals and commodities.
MacGillivray said because the mine would harvest up to 15 rare earth metals it is hard to set a definitive price point at which Ucore would initiate a full-fledged feasibility study or jump into the environmental impact statement process.
“Certainly a movement towards increased metal values in the rare earth metal sector and or us being able to tie up an end user agreement with defined prices would encourage development,” he said.
However, there is no timeline for starting permitting.
Instead, Ucore has invested in molecular recognition separation technology that has been used for other metals but not with rare earths, according to MacGillivray. Generating a revenue stream from that investment could also help the junior mining company fund Bokan, he said.
Based on Ucore’s preliminary economic assessment, the mine would cost $220 million to construct over two years and employ up to 300 people during that period. Ucore has “drilled off” a resource base to support operation for 10 years, which would require about 190 jobs, he said.
MacGillivray said Ucore continues to strengthen its baseline environmental work for the project.
In 2014, former Gov. Sean Parnell signed legislation authorizing the Alaska Industrial Development and Export Authority to finance up to $145 million for Bokan’s construction.
Elwood Brehmer can be reached at [email protected].