Canadian explorer Power Metals Corp. (TSXV:PWM) is hoping to prove it has a minable cesium deposit
Charles Kennedy | February 19, 2020 | SmallCapPower: China has a monopoly on one of the most strategic metals on the planet, and Washington is anxious to change that. Global dominance at this point in the game means control of the rare earth elements that form the backbone of existing technology and the future of technology, and while everyone is busy playing at war with oil and gas, Beijing is busy sitting on a monopoly of our most precious strategic metals.
(The following is an excerpt of an article originally published on oilprice.com on February 13, 2020)
There are 16 metals in total that form the world’s strategically critical rare-earth elements–and China controls the supply of every single one because it controls 96% of production.
One of these crucial metals is Cesium.
It’s worth up to twice the price of gold, ounce for ounce, there are only three producing mines in the world, and all of them are controlled by China.
The only question in this game now is whether there is any chance for North America to get its hands-on new cesium of its own to get out from under a Chinese monopoly.
But while there are only three cesium mines in the world, the potential is in new supply. Of five cesium occurrences in Canada’s Ontario province, a small-cap Canadian explorer called Power Metals Corp. (TSXV:PWM) owns 100% of three of them (West Joe, Tot Lake and Marko).
So, the focus now is not on what has been lost to China, but the promise of new North American critical cesium.
Exactly How Strategic Is Cesium?
Cesium is extremely rare globally. In May 2018, the United States Department of the Interior included lithium, cesium and tantalum on its list of Critical Minerals.
The supreme technological war of global dominance can’t be won without these metals, so whoever controls them has the upper hand.
Cesium is described by the German Institute for Strategic Metals (ISE) as “the most electropositive of all stable elements in the periodic table”, and the heaviest of the stable metals. Cesium is “extremely pyrophoric, ignites spontaneously when in contact with air, and explodes violently in water or ice at any temperature above -116 ° C”.
Laboratories use cesium compounds for strategic organic chemistry, including in x-ray radiation for cancer treatments.
The list of commercial and industrial applications is long and varied, from catalyst promoters, glass amplifiers and photoelectric cell components, to crystals in scintillation counters, and getters in vacuum tubes.
Much cesium demand also comes from the oil and gas industry, which uses cesium formate brines in drilling fluids to prevent blow-outs in high-temperature, over-pressurized wells.
In terms of world dominance, the “cesium standard” is the key. This is the standard by which the accurate commercially available atomic clocks measure time, and it’s vital for the data transmission infrastructure of mobile networks, GPS and the internet.
That means it has serious defense applications as well, including in infrared detectors, optics, night vision goggles and much, much more.
According to the USGS, the United States relied 100% on cesium imports in 2019. It’s hard to get a world market price on cesium because there is no trading of this strategic metal, but according to the most recent Mineral Commodities Summary, one company offered 1-gram ampoules of 99.8% (metal basis) cesium for $63.00, a slight increase from $61.80 in 2018, and 99.98% (metal basis) cesium for $81.10, a 3% increase from $78.70 in 2018.
But imagine China being able to starve manufacturers of something like cesium, which would seriously disrupt U.S. industry and hinder the development of critical military equipment. That’s exactly why this rare metal was left off Washington’s tariff lists in the trade war back-and-forth.
But Dr. Julie Selway, a key geologist for the Ontario Geological Survey during the tantalum boom of the early 2000s, and now VP of exploration for Power Metals, says the three properties the company is drilling are hoped to have similar finds as the strategically important Sinclair mine in Australia.
“They are shipping their resource, which they say is higher than 10% cesium-oxide, and ours have some that are between 12% and 14% of cesium-oxide,” Selway–one of the world’s most renowned experts on pegmatites–told Oilprice.com.
How Deep Is China’s Control?
China has dominated rare-earths since the 1990s with power in this sector that rivals OPEC for oil–even if it doesn’t make the headlines like oil and gas does.
In 2010, China cut back on exports, triggering major price spikes all over the world because of the critical nature of these metals to the tech industry.
That woke Washington from its slumber, but only slightly.
Beijing’s next move, according to the Wall Street Journal, was to manipulate the market so that rare earth elements (RREs) were cheaper in China than outside the country. What this did was prompt some major manufacturers and tech industries to set up shop in China, where they could get supplies at a lower cost.
In the entire world, there are only three pegmatite mines that can produce cesium: one is the Tanco mine in Manitoba, the second is the Bitika mine in Zimbabwe, and the third is the Sinclair mine in Australia.
Where does China fit into this picture? It controls them all, beyond its own borders, with few players like Power Metals and its three-play Cesium venue which could challenge that total control.
Washington’s emergence from its cesium slumber, however, was short-lived.
A United States company essentially sold off its control of cesium to Sinomine Resources of China last summer–even after the U.S. placing the metal on the critical list. Prior to this June 2019 deal, cesium production was largely controlled by Boston-based Cabot Corporation, which owned the Tanco mine in Manitoba, but which also has operations in China. This mine was shut down in 2015, with demand met from stockpiles.
Now, Tanco and Bitiki are no longer producing, but Sinomine Resources Group holds all the cesium ore stockpiles.
What that means is that this playing field isn’t just of strategic proportions–but it’s locked up.
The only company in the cesium supply chain right now is Chinese, and one of the only companies on the radar for potential commercial cesium supplies in North America is Canadian junior Power Metals, which is hoping to prove that it’s sitting on the world’s fourth minable deposit of the critical metal.
That’s why, finally, in December 2019, the United States and Canada agreed on a strategy to reduce the need for rare-earth metals mined or controlled by China.
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