When President Obama became the most recent American leader to lay out a plan for energy independence, he listed the perils of maintaining our dependence on imported oil: bankrolling dictators, paying for nuclear proliferation, funding terrorism...
Last week, against the backdrop of a seemingly never-ending stream of oil gushing into our waters, Mr. Obama made it clear that drilling for more isn't the way out either.
But what to do? As part of the solution, the President has called for producing one million electric cars by 2015. The goal sounds sensible. It turns out, though, that there's a catch. All of those new electric cars will need little-known ingredients called "rare earth" minerals to operate -- some for their batteries and some for their motors. It's the same story with wind power: a typical turbine uses massive amounts of these minerals. And right now, rare earths really come from only one place, China.
Chinese leaders are well aware of the power of their near-monopoly over rare earths. Indeed, former Chinese Premier Deng Xiaoping said two decades ago (somewhat prophetically, since back then the minerals weren't nearly as useful as they are with today's technology): "There is oil in the Middle East. There is rare earth in China." All this has led analysts to suggest that in "going green," we risk simply trading a dependence on Saudi oil for Chinese rare earths.
Reporting for PBS over the last two months, I learned a lot about rare earth minerals, which are a series of 17 different metals, the ones on that bottom row of the periodic table of elements. Their name is something of a misnomer. Many are not actually rare. Many are in fact evenly distributed all around the world.
China is at the top of the rare earths game for two reasons: abundant resources in its Inner Mongolia province and it can mine the metals cheaply, in part because of lax environmental standards. Yes, there is an irony in that "green technologies" for the West might rely on environmentally unfriendly mining in China.
In the span of a few years, these metals' uses have grown exponentially. Many are now more or less indispensable, primarily because of their importance in tiny, high-powered and extremely durable magnets used in everything from iPhone components to the Pentagon's missile guidance and satellite communications systems. It's somewhat shocking that the U.S. is already dependent on Chinese rare earth for some of its most advanced war fighting capacities.
For many years, no one saw a problem here. Despite Deng Xiaoping's rhetoric, China dug and processed all the rare earths everyone needed, cheaply. Now, in 2010, the growth of the Chinese economy threatens to change all that. With a massive population demanding all the same cars, iPhones and satellite systems that the U.S. wants, the Chinese need these very same resources for their own explosive growth.
Zhang Anwen, the top man at the quasi-governmental Chinese Rare Earths Guild, told us bluntly: "Foreign countries should calmly and logically think about this and develop their own mines for their own needs."
In the global race to identify and exploit new reserves of the metals, sites in South Africa, Australia and Greenland are currently being developed. My reporting took me to the Avalon Rare Earths Ltd site in Canada's frozen Northwest Territories, where there is a sort of 21st century gold rush underway. Avalon's machines are running day and night, pulling core samples from up to 1000 feet below the surface of Thor Lake, revealing promising evidence of a rich rare earths deposit. But Avalon's site will take years to get up and running. Strict environmental permitting will then be followed by construction of an under-the-lake mine. (See the full story here)
Here in the United States, the California desert's Mountain Pass area was once the largest source of rare earth minerals in the world, until an environmental spill (sound familiar?) and aggressive Chinese pricing sounded the death knell of American rare earth mining.
New owners of the Mountain Pass mine hope to restart mining of rare earth minerals by next year. Molycorp Minerals recently went public and CEO Mark Smith is seeking federal loan guarantees to support its capital-intensive start-up. He told Congress that Molycorp could, in fact, be the lowest cost producer in the world. But he added, "We do need help in that regard. I have 17 scientists and engineers that are competing with over 6000 Chinese scientists."
A new bill, known as the "Restart Act," proposes reinvigorating the U.S. rare earth sector through loan guarantees and establishing a national stockpile of the minerals. The General Accounting Office warns, though, that it could take up to 15 years for the U.S. to rebuild a domestic supply chain.
So, the good news is that rare earths can be a secret weapon for a more energy independent America. Possible deposits in Idaho, Wyoming and Alaska give hope that there could one day be enough rare earths production in the U.S. to satisfy American demand. In the near term, allies like Canada and Australia could also help diversify the supply.
But the clock is ticking. Developing new mines can take years and years. As one prominent analyst put it, the crisis in not in the future -- the crisis is already here.
About the author: Jason Maloney is the co-founder of The Bureau of International Reporting (www.thebir.org), a non-profit news organization dedicated to the coverage of foreign affairs topics and the author of Your America: Democracy's Local Heroes.
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