STRATEGIC AND CRITICAL METALS IN ALASKA A MINING INDUSTRY - PowerPoint PPT Presentation

STRATEGIC AND CRITICAL METALS IN ALASKA A MINING INDUSTRY PERSPECTIVE Curt Freeman, Avalon Development Corp.

ACKNOWLEDGMENTS My personal thanks to my staff and to all of the web sites and publications from which I shamelessly boosted information for this presentation

THE MAIN THING IS TO KEEP THE MAIN THING THE MAIN THING Steven Covey

WHAT IS A STRATEGIC MINERAL? A strategic mineral is a mineral that would be needed to supply the military, industrial, and essential civilian needs of the United States during a national emergency. Furthermore, strategic minerals are not found or produced in the United States in sufficient quantities to meet this need. Data from Critical Minerals Conf., 2012

WHAT IS A CRITICAL MINERAL? A critical mineral can be regarded as critical only if it performs an essential function for which few or no satisfactory substitutes exist. Examples include Rare Earths, Lithium, Platinum group elements, High purity quartz, Antimony, Rhenium, Beryllium, Tantalum, Cobalt, Tellurium, Niobium, Tungsten, Gallium, Yttrium, Germanium. Data from Critical Minerals Conf., 2012

ALASKA IS GEOLOGICALLY PROSPECTIVE Element # of Prospects Gold 4,568 Tungsten 531 Molybdenum 499 Mercury 347 Sn-Ta-Nb 332 Chromium 264 Bismuth 198 REE 156 U-Th 155 Cobalt 142 Thallium 111 Beryllium 55 Vanadium 39 Tellurium 29 Indium 2 Scandium 2 Data from Avalon Development, 2012

Red Dog Ray Mts. (In) (Sn, REEs) Bornite (Co) Graphite Cr (Graphite) Snettisham (Ti, Fe) Salmon Bay MAN (REEs) (Ni, PGEs) Salt Chuck Bokan Tonsina (PGEs) (REEs) (Ni, PGEs) Data from Avalon Development, 2012

ALASKA PLAYERS  REEs: Ucore Rare Metals at Bokan and Ray Mountains project; Contango ORE at Salmon Bay and Stone Rock Bay  PGEs: Pure Nickel at MAN and Salt Chuck; Pacific North West at Tonsina  Graphite: Graphite One at Graphite Creek  Other: Arrowstar at Snettisham (Ti); Teck at Red Dog (In); NovaCopper at Bornite (Co); Ucore at Ray Mts. (Sn) Data from Avalon Development, 2012

YOU CAN AVOID REALITY BUT YOU CAN’T AVOID THE CONSEQUENCES OF AVOIDING REALITY AYN RAND

GLOBAL ECONOMIC CHALLENGES  The small volumes of strategic/critical minerals utilized make them extremely price sensitive  New producers need to “steal” a reliable, long-term buyer from existing producers  Long-term buyers require fixed price schedules, but operating costs are variable  Monopolies/oligopolies often drive out marginal producers by over-supplying the market until competition is eliminated Data from Avalon Development, 2012

120 U.S. IMPORT RELIANCE – 2011 100 10099 99 98 100 Data from USGS, 2012 90 89 89 88 87 87 85 83 80 78 76 76 75 75 73 80 % Import Reliance 69 68 63 60 60 56 53 47 42 41 39 40 36 36 35 35 27 24 22 21 20 20 0 C S E R E E T S S M M M E D M H M E E T R C T M M L N A T R R T P M M M M M M M M S M H Y M E N E . M D N L E M C I O T T S E L H N T D L A E E A L A A U U U E T N U N N S U I E N G U U O I L E E T U T N U U U U U U U U U U U N U T N I I E E A T I A E K N I A R I T P I N U O O O A I I V I N O T P T F X I H I I I I I L I I I I D I N I R B I I I C L I L E D L D Z O D S O S D N H B T R D T L R R N N B P M C R E S L S S A O M T L G S P R L C U P M I M T A O I U S N L L O R E L E N A S O S A I N O T A T E A O I C A L M M M E R S O O I A G O U S A A B T T S B S P N E C R A A I A A I A N I Y C I Y A O T M T H N L B O G I E N H S P C R S M G N C S U B R A N U I S M P I A H G I C M R A R C Y B L N R A L G M S R T M R D L U N C E R A H A U G P U A E C C T A M U A S T V N A R A L A R T E E C T I I B I M P N I S U N M M E F M Z G G O S A E I A V T C E R N G T R N I A L I O A G T I T R U S I A T T Q M I N

THE CASE FOR ARSENIC RARE: CRUSTAL ABUNDANCE ARSENIC (2.1 ppm Avg Crustal Abund.) Data from USGS, 2008

WHO WANTS TO PRODUCE?  The U.S. imports 100% of the arsenic it uses for domestic purposes (~4,000 tpy)  Arsenic is not rare from a crustal abundance standpoint, nor does it have a high unit value in the market place ($1.75/kg)  Arsenic is a common waste by-product in a number of ore deposit types mined in the U.S.  The cost:benefit ratio of recovering arsenic from an arsenic-rich deposit is too high in the U.S. (and many other countries) Data from USGS, 2012

ALASKA-CENTRIC CHALLENGES  Alaska’s limited access, infrastructure and energy systems require higher unit value ore to make projects cost competitive  Alaska’s higher environmental standards will increase costs and the time it takes to move from discovery to production  Much of the most prospective geology for strategic and critical minerals in Alaska is closed to mineral entry Data from Avalon Development, 2012

ROY CREEK GEOCHEM Data from Burton, 1981

STRAT-CRIT CONCLUSIONS  Alaska’s geology is highly prospective for a wide variety of strategic and critical minerals  Prospects with high unit value rock will be preferentially targeted by industry  Prospective districts with good access, infrastructure and energy systems will be preferentially targeted by industry Data from Avalon Development, 2012

IT WASN’T RAINING WHEN NOAH BUILT THE ARK HOWARD RUFF

QUESTIONS? Photo by Avalon Development Corp.