Avalon Reopens Nechalacho REE Project Amid Growing Demand

Avalon Advanced Materials (TSX:AVL), announced it will re-activate its wholly-owned Nechalacho Rare Earth Elements Project, Thor Lake, NWT this year due to strong demand for the magnet rare earths neodymium and praseodymium.

The demand for rare earth elements is expected to grow as more industries look to develop extra strength magnets for a variety of purposes. Rare earth magnets remain vital to many clean technology applications requiring high efficiency, lightweight electric motors and generators. This includes motors for electric vehicles, which can require 5-10kg of rare earth magnets per vehicle. The growing market for electric vehicles, especially in China, has created new demand for these high strength magnets, resulting in rising prices for neodymium and praseodymium, both now selling for over C$100/kg in oxide form.

As quoted in the press release:

While Avalon’s 2013 Feasibility Study focused on the underground accessible, heavy rare earth-rich Basal zone of the Nechalacho Deposit, the property hosts several other easily accessible, near-surface, rare earth mineralized zones including high grade, neodymium-praseodymium (“Nd-Pr”) rich resources. These are located in the T-Zone and Tardiff Lake Zones. These zones have potential for near-term, small-scale, low-impact development to produce Nd-Pr rich concentrates for export and will be the focus of renewed development work planned for the Project in 2018.

Neodymium Potential

Previous work on the Project has identified high-grade, near-surface neodymium mineralization associated with the light rare earth ore mineral bastnaesite in both the North T Deposit and Tardiff Lake Zones of the Nechalacho Deposit. The former was drilled by previous owners of the property in 1982-85 and the Nechalacho Deposit was extensively drilled by Avalon in 2007-12. However, there was little systematic analytical work for rare earths during the early exploration in the 1980s.

Development and Permitting Plans

Avalon plans to investigate the possibility of developing Nechalacho as a near-term, small-scale producer of Nd-Pr rich concentrates for export involving potentially a simple mining, crushing and optical sorting operation. This has significant advantages over the already-approved project plan from an environmental standpoint.

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