Top Stories This Week: Gold Breaks US$1,900, Sweden Makes Rare Earths Discovery

Sweden's LKAB finds Europe's largest rare earths deposit

This week also brought news from the rare earths market, a sector we don't often get to cover at INN.

State-owned Swedish mining company LKAB announced on Thursday that it has found Europe's largest rare earths deposit. Called Per Geijer, a mineral resource for the asset shows that it holds over 1 million metric tons of rare earth oxides.

"This is the largest known deposit of rare earth elements in our part of the world, and it could become a significant building block for producing the critical raw materials that are absolutely crucial to enable the green transition," said Jan Moström, LKAB's president and group CEO. "We face a supply problem. Without mines, there can be no electric vehicles."

Rare earths are important in a slew of high-tech applications, and electric vehicles are becoming a key source of demand as they gain traction on a global scale. With consumption of these critical metals on the rise, countries around the world are looking to diversify away from China, which has long dominated rare earths production and processing.

Although its stranglehold has weakened in recent years, the US Geological Survey pegs China's 2021 rare earths production at 168,000 metric tons, far ahead of the US' second-place number of 43,000 metric tons.

Europe doesn't produce any rare earths at the moment, and LKAB has emphasized that while the discovery of Per Geijer is significant, bringing the project into production will take time. Moström said in the company's press release that he doesn't see that happening for 10 to 15 years, unless Europe takes steps to speed up the permitting process.

At the same time, the region will need to build up its processing capacity.

"So we also need to focus on the entire value chain on these metals, products like high efficiency magnets that we want to use for wind turbines or traction engines in (electric vehicles) and so on," Erik Jonsson, senior geologist at the Geological Survey of Sweden's Department of Mineral Resources, told Reuters.

For now, LKAB's first step will be to apply for an exploitation concession, which will allow it to undertake further exploration of the deposit. The company plans to submit its application later this year.

LKAB is best known as an iron ore miner, accounting for 80 percent of the EU's output of the material. It also sells other industrial minerals and offers various products and services, including drilling solutions, concrete and explosives.