Previous rumours have been confirmed by the recently published EPA documents that instead of its traditional induction engine, Tesla has decided to use a Permanent Magnet Motor (PMM) in its Model 3. “This means PMMs have nearly 100% market share in automotive applications – underpinning the great growth potential for NdPr,” says Peak Resources.
“So the 500,000 already ordered Telsa Model 3s, of which production recently started, will consume a minimum of 600 t incremental new demand of NdPr oxide per year. This is equivalent to 2% of the world’s global legal annual produced Nd/Pr oxide – and that’s just the beginning! According to Bloomberg, more than 120 additional new electric cars are in the pipeline to be launched during the next 2.5 years to join the Model 3.”
Peak also reports that “Baotou China announced its new August price list with a steep price increase for neodymium/praseodymium oxide 99% domestic China from 330 RMB to 420 RMB per kg. After that the market climbed to 458.5 RMB/kg or $68.44/kg.”
Peak announced the results of the BFS during the last quarter for the Ngualla rare earth project in Tanzania and the Tees Valley refinery in the UK. That confirms Ngualla has the potential to become one of the lowest cost NdPr projects worldwide with key metrics including:
- A significant reduction in annual operating costs of $35 million, or 30%, compared to the PFS
- A 30 year life project with production strongly aligned to the permanent magnet market
- Pre tax NPV10 of $676 million and pre tax IRR of 25%
- Revised Ore Reserve estimate confirms Ngualla as one of the highest grade NdPr rare earth deposits in the world.
The company is in the final stages of completing the documentation required to lodge a mining licence application for the Ngualla project. It will, during this process, gain further clarity on the practical impact of recent legislative changes governing the resources sector approved by the National Assembly post quarter end on 3 and 4 July 2017.
The mining licence application is in line with the company’s primary business strategy to position Ngualla as one of the very few projects that is ready for implementation in time to meet the widely predicted surge in demand for the magnet materials NdPr from electric and hybrid vehicles (EVs).
Peak says “markets are becoming increasingly aware that NdPr has a similar importance as a raw material for the manufacture of EVs as have lithium and cobalt, which have experienced marked price rises in recent months.”
Final products from the project planned to be produced annually are:
- 2,420 t of neodymium and praseodymium oxide (2N minimum 75% Nd2O3)
- 6,940 t lanthanum carbonate (equivalent to 3,650 t/y oxide)
- 3,005 t cerium carbonate (equivalent to 1,660 t/y oxide)
- 530 t of mixed SEG and Heavy rare earth carbonate (equivalent to 280 t/y oxide).
