From Agoracom:
Good day,
The following responses have been provided by management.
Question: The update of 1/20 states that drilling permits should be approved in "20 to 60 days." But a "season's greeting" message from Mr. Briscoe gives the impression that those deadlines may have been written earlier and there was some delay in the release of this update. Can LBSR comment on this? Even if the 20 days began on the day of the release, we are nearing the 20 days so any general interpretation would be welcome.
Answer: We don’t have word beyond our last news release regarding the timing of permits. We do expect permits soon. The timing is controlled by the Arizona State Land Department. As far as we know the process has been routine. However, the State Land Department has asked for additional details of our program because of its size and scope. We are supplying those details. The State Land department is not constrained by an exact time table.
Question: The map of Hay Mountain produced by LBSR includes a very large green outline labeled as an REE anomaly. There seems to be quite a bit of heated discussion regarding the interpretation of the company's mentions of REEs, including some that question the integrity of the company. As far as we know from public communications, there has been little actual testing for REEs so far and the only conclusion drawn to date (that is not confidential perhaps?) is that there are traces of three REEs. By actually labeling the map with the outline and using the term "REE anomaly" what can be deduce about LBSR's beliefs on the presence of REES here? Does the word "anomaly" indicate any connotation of implied or inferred minerals or is there no actual technical meaning that we can infer? thanks for shedding light on these two issues. I remain a shareholder and have every confidence in the company and its people.
Answer: “Quite a bit of heated discussion?” I’ve seen one person on I-Hub making negative comments about Liberty Star’s statements regarding REEs. That being said, a review of our statements starting May 15, 2012 indicates that there is a definite need to pursue evaluation of REEs at Hay Mountain:
1)News Release 122 (5/15/2012) states “A surprising presence of rare earth elements (REE) has been defined over a large area. This was completely unexpected and justifies further study. The REEs we assayed for are among the 17 REEs now known, are strongly anomalous, and are scandium, yttrium, lanthanum, and cerium. The other 13 known REEs were not included in our assay process. In due course we will re-assay the samples for these additional REEs. Rare earth elements are critical to various civilian and military hardware and are commercially important.” Had there been a precedent for a meaningful REEs presence, we certainly would have tested for more of them when samples were shipped off to the ALS labs in the first place.
2)The anomaly stems from geochemical sampling only, an anomaly is just that: “Any departure from the norm, which may indicate the presence of mineralization in the underlying bedrock” (From the Glossary on our website-- dropdown from the Mining Explained tab). When anomalies are detected, there is cause for further investigation. We have made no comment inferring a resource, because not enough exploration work has been completed. We have a short book put out by the US Department of Agriculture/Forest Service on our website called Anatomy of a Mine from Prospect to Production that is a good primer.
3)REEs are of growing importance to the US economy. CEO Briscoe feels stongly enough about the issue that he addressed shareholders in August, 2013 in a letter titled About Rare Earth Elements. A year later his letter was submitted as written Testimony for the Record to the US House of Representatives Committee on Energy and Mineral Resources for the July 23rdhearing on “”American Metals and Mineral Security: An examination of the domestic critical minerals supply and demand chain.”
4)Will there be commercially important amounts of any of the 17 REEs at Hay Mountain? We don’t know yet and won’t know without further exploratory work. Our position and statements have never stated anything else.
Here’s a few thoughts from Jim:
“I have attended two major professional presentations, and has reviewed numerous industrial news articles and technical reviews and papers on rare earth metals. I have also visited the largest the largest rare earth producer in the USA at the Mountain Pass mine at Mountain Pass California shortly after it’s opening circa 1967 about 48 years ago, and on subsequent occasions over the years. I have talked with metallurgists who operate the mine and have kept up with the Chinese who are the largest producers of REE’s, who’s low selling price forced one insolvency at the Mountain Pass mine – a common tactic the Chinese use to corner markets – illegal in the USA of course.
After the above studies which are ongoing, we unfortunately have found rare earth metal are not rare after all and they occur in very numerous places in North America and elsewhere throughout the world. There has not been more production except for Mountain Pass because Mountain Pass supplied all of the US consumption with many decades of reserves at saleable production rates over most of its life. And the sector of Chinese market/price control.
Our geochemical studies show that rare earths are part of porphyry copper outer metal halos along with other metals- which is a first. We have every technical reason to expect a very large body of metals associated with the main or inner porphyry copper system at Hay Mountain. These include copper, molybdenum, gold, lead, zinc, probably silver, and other metals. These metals have a known demand on an international market, the market for which is expanding. The recovery metallurgy is simple and well known and relatively low cost, and mining methods are also well known. Rare earth metals have very complex extractive metallurgy to separate them out into their different components. There is also hazardous by products that even the Chinese have to deal with in REE mining. The new metallurgical plant at Mountain Pass cost about $1 billion to construct, and is very complex to run.
As we drill test the porphyry copper at Hay Mountain we will also be able to test part of the rare earth anomaly as part of that drilling. We can then determine whether rare earth recovery at Hay Mountain could be an economic enterprise or would it simply result in production of unsalable rare earth metals. We are looking for profit, not experimentation with the unknown or poorly known commodity or something whose market could be undercut by the Chinese or others with a lower cost basis at a moment’s notice.”
