Just got American Rare Earths (OTC:) (WKN A2P8A0 / ASX ARR) acquired a high-grade rare earth project called Searchlight, and the next acquisition will follow. The Australian company expands its portfolio with the rights to the scandium deposits of the Split Rocks project in Western Australia!
Just today, American Rare Earths announced that Zenith Minerals (ASX ZNC) had acquired the right to search for scandium, nickel and cobalt on the project and, if necessary, to develop potential deposits. As part of the binding agreement between the parties, American Rare Earths then received an exclusive option on all scandium found to a depth of 50 meters or less in any portion of the Split Rocks project (E77 / 2388).
Scandium is classified as a “critical mineral” so it is in high demand. It is mostly added to aluminum products to make them lighter, stronger, and more resistant to both corrosion and heat. The aviation industry in particular is interested in scandium-enriched aluminum material, as it can reduce the weight of an aircraft by 15 to 20 percent, which in turn means lower costs.
Zenith first discovered the elevated near-surface scandium levels in 2018. It was possible to detect more than 50 ppm (parts per million) of the metal in 62 samples from 46 holes. And none of these samples came from more than 52 meters deep. In addition, three samples contained scandium contents of more than 100 ppm and three further samples contained scandium contents of more than 90 ppm.
As explained by American Rare Earths, the saprolite clay scandium resides in near surface laterite deposits and all higher grade samples come from depths less than 24 meters!
In addition, previous drillings by Zenith also detected anomalous values of cobalt and nickel in addition to scandium, including 30 meters with 0.06% cobalt and 0.75% nickel from 20 meters and 12 meters with 0.27% cobalt and 1, 45% nickel from a depth of 20 meters.
According to American Rare Earths, the acquisition of the scandium rights fits in with the strategic goal of creating a global supply chain for rare earths and scandium. In addition, in addition to the USA, it now also gives access to critical minerals in Western Australia.
Especially since American Rare Earths discovered scandium on its projects in Arizona and Wyoming. According to CEO Keith Middleton, these projects will continue to be a priority for the company, but the acquisition of Split Rocks’ scandium rights is a unique opportunity to expand the scandium portfolio and provides a starting point for the expansion of the rare earth and rare earths strategic material strategy in the future.
REE acquisition in the USA
The Company had recently submitted a technical report on the newly acquired Searchlight project in Nevada, located just a few miles west of the only integrated rare earth manufacturing and processing facility and mine in the United States. The Mountain Pass mine is estimated to produce around 15% of the current global supply of rare earths.
The Searchlight project consists of 80 contiguous rare earth claims covering a total of 656 hectares. So far, samples have produced so-called heavy rare earths. In any event, the results of the American Rare Earths technical report prompted a tiered exploration program on the project to include structural mapping, geochemical sampling, aerial geophysical surveys and, ultimately, drilling.
Searchlight is the perfect complement to the company’s other rare earth projects in the United States, La Paz and Laramie, both of which have high-priced rare earths for magnet production (especially needed for the renewable energy sector) and scandium and potentially other critical ones Contain minerals – without being significantly contaminated with pollutants, according to Middleton.
Searchlight, which also has Magnet rare earths, is an excellent addition with which American Rare Earths offers investors and potential buyers an attractive, diversified rare earth portfolio.
Conclusion: Even if Split Rocks and the Scandium rights to the project are more likely to be intended for the future, we believe they are an attractive addition to the American Rare Earths project portfolio (WKN A2P8A0 / ASX ARR). We believe, overall that the market has not yet really realized what the company has built and is building.
In particular, the projects in the USA, which are also or especially under Joe Biden’s work on their strategy with regard to critical minerals, will sooner or later move much more into focus. Especially since drilling results from La Paz in the near future and exciting initial exploration results from Searchlight in the not too distant future are to be expected. American Rare Earths is certainly a high-risk speculation, but we currently believe the odds are at least as high.
In accordance with Section 34b WpHG and Section 48f Paragraph 5 BörseG (Austria), we would like to point out that partners, authors and / or employees of GOLDINVEST Consulting GmbH can hold shares in American Rare Earths and thus a conflict of interest could exist. Furthermore, we cannot rule out that other stock market letters, media or research firms will discuss the values we have discussed in the same period of time. Therefore, symmetrical information and opinion generation can occur during this period. Furthermore, there is a consulting or other service contract between GOLDINVEST Consulting GmbH and a third party in the issuer’s warehouse (American Rare Earths), which creates a conflict of interests, especially since this third party grants GOLDINVEST Consulting GmbH for a fee for reporting American Rare Earths rewarded. This third party may also hold, sell or buy shares in the issuer and would benefit from a rise in the price of American Rare Earths’ shares. This is another conflict of interest.