La Paz Rare Earth Project
ARR formed a 100%-owned US-based subsidiary called La Paz Rare Earth LLC to acquire and develop the La Paz Rare Earth Project, located in La Paz County, Arizona, US in August 2019. The project lies about 170km northwest of Phoenix (Figure 1).
La Paz covers over 890 hectares, comprising 107 unpatented lode mining claims on federally controlled land and a prospecting permit over one section of Arizona State Trust land (259 hectares). The tenements are unencumbered and 100% controlled by La Paz Rare Earth LLC.
Initial field activities undertaken in October 2019 included mapping, sampling and a review of historical datasets, which identified mineralisation at a higher grade to the southeast of the existing resource. This led ARR to double its US footprint with the application to acquire a further 660 hectares directly adjacent to the existing tenements to secure the full rare earth potential of the region.
The La Paz area was first shown to contain rare earth elements during exploration sampling programs in mid-2010. The area is located in western-central Arizona within the structural Detachment Fault Domain of the large Basin-Range Province.
During 2011, Australian American Mining Corporation Ltd drilled 195 percussion holes for 5,120 metres, which supported the definition of a maiden NI 43-101-compliant resource estimate. The resource displays relatively uniform distribution of total rare earth elements (TRRE) across and along strike, covering a resource area 2.5km by 1.5km. The entire deposit is exposed at surface, or lightly concealed by alluvial cover. It is open at depth and is currently defined to 30m below surface (Figure 2).
Composite and selected interval samples were submitted to leading independent groups at SGS Canada Inc (Vancouver) for mineralogical investigations (QEMSCAN, XRD and Electron Microprobe analysis) and the Saskatchewan Research Council (SRC, Saskatoon) for preliminary metallurgical test work (pre-concentration and leaching).
The maiden resource estimate and preliminary metallurgical test work formed the basis of an independent NI 43-101 report completed late 2011. Additional metallurgical test work was completed in early 2012.
ARR is now working towards converting the NI 43-101 compliant resource to Australian JORC 2012 standards and will announce further technical and project details once completed.
Strong Government Support for US Critical Minerals
US-China tensions have fuelled the ramp up in financial incentives being deployed by the US Government to secure its supply chains across several critical minerals, including rare earths and scandium.
The US has just one rare earths mine, Mountain Pass, and the government is being very proactive in trying to shore up more supply, particularly given the importance of rare earths in electric vehicles, renewable energy infrastructure and defence applications.
On taking office in 2021, US President Joe Biden initiated a 100-day review of vulnerabilities in America’s supply chains. Prior to that, former President Donald Trump issued an executive order to stimulate domestic production and processing of critical minerals including rare earths and scandium.
The current trade and political landscape offers shareholders exposure to growth markets that are seeking to diversify supplies globally.
ARR has a track record of implementing development projects in strategic metals and the opportunity at La Paz is another case in point.
Management has been looking to expand the company’s exploration horizons from principally the Murray Basin/Broken Hill regions, but also to use the expertise and knowledge gained from the successful development of the Broken Hill Cobalt Project.
The Broken Hill Cobalt Project is a large, low-grade strategic metal deposit with good infrastructure and the La Paz rare earths deposit offers similar opportunities, though with a number of unique strategic properties.
Applying the successful techniques that ARR utilised to advance the Broken Hill Cobalt Project and taking advantage of the expertise and low-cost structure utilising North American resources, the Board believes that this acquisition and development of a resource base in Arizona will be transformational for the company.
ARR was exempted from the Biden Administration’s 60-day moratorium on ground disturbing activities allowing it to start drilling at La Paz in March 2021.
Following evaluation of the available data, a clear opportunity emerged for cost-effective, targeted expansion of the resource. The company is focused on drilling deeper as it explores the opportunity to increase the resource size and average grade.