Peak Resources Ltd has discovered fluorspar in Ngualla in southwestern Tanzania. This will be the second revenue stream for the firm after rare earths.
The Australia Stock Exchange-listed company says it plans to fast-track studies to assess the deposits in the Ngualla rare earth project 147km from Mbeya town.
Peak managing director Darren Townsend said the find will help meet the growing global demand for rare earth metals driven by electric cars, bikes and wind power generation.
Ngualla has deposits of flourspar, barite, niobium and phosphate. The neodymium and praseodymium (NdPr) found at Ngualla is a class of rare earth elements for making magnets used in hard disk drives, headphones, loudspeakers, electric motors and generators.
China’s domestic NdPr oxide prices have seen steady increases over past seven months, after a six-year fall. Prices have risen by 32 per cent from $36 per kilogramme since mid November 2016 to an average of $47 in July 2017.
“Against this background, we will apply for a mining licence,” said Mr Townsend.
The total investment to bring the project into production is about $330 million.
Neodymium and praseodymium outside Australia in 2010 and 2013 averaged $270 per kilogramme but prices fell in 2013.
“At current prices of around $39 per kg for a Nd/Pr mixed oxide, the project would breakeven at operating level,” London-based RFC Ambrian, an investment advisory firm.
The use of neodymium-iron-boron magnets in power generation has allowed wind turbines to reduce costs and increase efficiency by eliminating gearboxes.
Electric vehicles are a potentially disruptive technology that could transform the car industry and drive increasing demand for neodymium and praseodymium.
High-torque efficient permanent magnet motors have in recent years been used in electric vehicles.
Out of 370,000 hybrid and plug-in electric vehicles sold in the US as at September 2016, 328,000 units used permanent magnet motors whose market is growing globally.