3 Rare Earths Companies Up Over 40 Percent Year-to-Date

Like the rest of the commodities market, the rare earths sector is definitely less exciting now than it was a few years ago. Indeed, the share prices of some of the more well-known rare earths producers — Molycorp (NYSE:MCP) and Lynas (ASX:LYC), for instance — haven’t fared so well.

However, that isn’t to say that rare earths miners have gone away completely. In fact, some have even seen share price rises in 2014. Here’s a look at three rare earths companies with share prices that have grown by at least 40 percent this year.

GéoMégA Resources (TSXV:GMA)

So far this year, GéoMégA has gained 55 percent and is currently trading at $0.155. The exploration and development company holds a 100-percent interest in the Montviel rare earths and niobium project in Quebec, and is also working with partners to develop a physical separation process for the production of rare earths.

At the beginning of the year, GéoMégA reported results from a phase 3 drilling program at Montviel, noting the intersection of a heavy rare earths zone containing dysprosium and neodymium oxide. The zone was defined over 350 meters by 20 meters by 230 meters and remains open at depth. In May, the company received conclusive benchmark results confirming the viability of its process for the physical separation of rare earths from commercial mixed concentrate.

GéoMégA also reported a gold discovery at its Anik property this summer, and commenced a 3,000-meter drill campaign at the project on November 11.

Namibia Rare Earths (TSX:NRE)

As its name suggests, Namibia Rare Earths is focused on its wholly owned Lofdal rare earths project in Namibia. The permit area covers 573 square kilometers, and to date the company has completed over 14,000 meters of drilling within a 50-square-kilometer portion of the Lofdal carbonatite complex at the property.

Namibia Rare Earths reached a milestone for the project in 2014, initiating a preliminary economic assessment in May and announcing the completion of the report in October. The report suggests that Lofdal has the potential to be developed as a 2,500-tonne-per-day heavy rare earths oxide mine with a seven-year mine life. Overall, the project would garner capital costs of US$156 million for an after-tax net present value of US$147 million at a 10-percent discount, and investors would see an after-tax internal rate of return of 43 percent with a 1.7-year payback period.

To date, Namibia Rare Earths is up 52 percent, trading at $0.19

Mkango Resources (TSXV:MKA)

Also located in Africa, Mkango Resources is developing its Songwe Hill rare earths project in Malawi. Although Mkango is trading at just $0.10, it’s worth noting that the exploration and development company’s share price performance has been strong this year, with the stock up 42 percent year-to-date.

Mkango was fairly quiet at the start of the year, aside from some fairly successful financing activities, but in September the company reached a major milestone when it released results from a prefeasibility study for Songwe Hill. CEO William Dawes noted at the time that Mkango now has one of three African rare earths projects with a prefeasibility or feasibility study in hand.

Based on a conventional open-pit design using contract mining, the study estimates a mine life of 18 years for Songwe Hill. The company believes there is significant potential to reduce the strip ratio and expand the production and mine life at the project. Initial capital expenditures are set at US$217 million for an after-tax net present value of US$293 million at a 10-percent discount, and a 36-percent after-tax internal rate of return. The mine is anticipated to begin production in 2017.

Securities Disclosure: I, Teresa Matich, hold no direct investment interest in any company mentioned in this article.

Editorial Disclosure: GéoMégA Resources is a client of the Investing News Network. This article is not paid-for content.