The Sexiest Story in B.C. Mining

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Spectrum Mining in B.C. released promising drill results that has the industry buzzing.

Metals scarcer than gold spark life 
in the junior mining sector.

Gold prices and the joyous rescue in Chile grabbed headlines this year, but the sexiest story in mining these days among investors is rare earth minerals and metals. And where there’s a hot mining story, B.C. juniors are sure to jump in.


Sure, elements such as neodymium, terbium and tantalum are hardly the stuff of water-cooler banter, but people are buying ever-growing numbers of iPads, Priuses and PlayStations – products that depend on these long-overlooked metals. Modern batteries, computer circuits and the wind turbines we increasingly expect to power them are just part of a very long list of items that wouldn’t exist without a group of 17 metals that are commonly referred to as rare earth elements. Demand is exploding, and China, with a near monopoly, is threatening to end export of rare earths to satisfy its own manufacturing needs. The result is, well, a gold rush.


This province’s rare-earth industry, like that of the rest of the non-Chinese world, is still at a speculative, embryonic stage. China’s mines produce as much as 97 per cent of the world’s supply of rare earth elements, leaving all other comers scrambling to find supplies. Companies here are taking two main approaches: digging holes to look for rare elements and manufacturing products made of them.


In 2009 geologist Chris Graf, who founded the private Spectrum Mining Corp., released promising test drill results at his claim 80 kilometres northeast of Prince George. Spectrum had drilled 11 holes and found various concentrations of cerium, lanthanum, praseodymium and neodymium. Graf is somewhat of a legend in the local rare-earth game, so this news immediately prompted a flood of junior mining exploration companies to encircle his site with claims of their own.


Bolero Resources Corp., International Montoro Resources Inc., Commerce Resources Corp., Canadian International Minerals Inc. and others all have claims near Spectrum’s. Never mind that nobody else had so much as put holes in the ground; these companies are now in the process of figuring out if they have anything worth developing on their own properties. None of these players has the money and resources needed to actually mine any rare earth elements or bring the much-sought-after commodities to market. What they’re selling is the promise that something under the land they’re holding is valuable enough that a bigger mining company will buy it from them. 


But one B.C. company has decided it wants to earn revenues – now as well as in the future. IBC Advanced Alloys Corp. has yet to pull any resources out of the ground, but it’s already manufacturing and selling high-tech alloys made out of beryllium. (OK, beryllium is technically a rare metal and not a rare earth metal, but business-wise it’s the same game. That is, digging new materials from the earth to make new technologies.) IBC has mining rights for properties in Brazil, Colorado and Utah. But it’s already manufacturing alloys in four American facilities using beryllium sourced in part from Kazakhstan. Indeed, IBC already boasts big-name customers such as Honda Motor Co. Ltd., Honeywell International Inc., Siemens AG and Raytheon Co.


IBC’s president and CEO, Anthony Dutton, tosses a few hunks of metal at his interviewer, including a piece of an Airbus 310’s brakes and a gimbal post for an airborne-mounted optical system. The post looks like it’ll hit with a thud, but it’s lighter than a Frisbee. “That’s beryllium-aluminum alloy,” he says. Beryllium is very good at making things lighter, stronger and more durable — just to name a few of its talents. 


IBC has a far more ambitious goal than the typical junior company: to become a vertically integrated supplier of advanced alloys. It’s trying to expand the market for its beryllium before it pulls an ounce from the ground. In addition to growing its manufacturing business, IBC is investing heavily in R&D to develop further applications for beryllium, such as combining it with nuclear fuels to improve reactor safety.


Analyst Siddharth Rajeev of Fundamental Research Corp. notes that IBC faces competition from bigger manufacturers, it has no history of productive mining and its R&D payoffs remain unknown. But in an industry that’s all about chasing a payoff that may never come, IBC already has more upside than most, at least according to its CEO. “I think IBC is actually much further ahead of those rare-earths companies because we’re generating revenues; we’re a profitable entity and growing,” says Dutton.


Which is saying something, because at this early stage of the industry, earning money remains the rarest element of all.