Great Western shares rise, stock exceeds 50-day average volume

Integrated rare earth company Great Western Minerals' (CVE:GWG) stock rose more than 6 per cent Tuesday, exceeding its 50-day average volume. 

The company's shares were up 6.5 per cent at 32.5 cents this afternoon. 

Rare earths have been in focus lately as Australia-based Lynas Corporation (ASX:LYC) this week received confirmation that its controversial plant in Malaysia has won a temporary operating license (TOL) from the country’s Atomic Energy Licensing Board (AELB).

The facility has faced several challenges, including funding withdrawals during the financial meltdown of 2008, and delays in licensing, as well as falling rare earths prices. 

Lynas plans to produce 11,000 tonnes of rare earth elements (REEs) a year, with plans to reach full production of 22,000 tonnes a year before the end of 2013. 

The news of the license has led to increased interest from investors - though some fear that a quick surge in production (from Lynas and Molycorp) could further cause REE prices to drop in the longer term. 

But demand for rare earths, which has a range of technology applications, is still projected to grow given a rising middle class. 

Great Western is an integrated rare earth processor, whose specialty alloys are used in the battery, magnet and aerospace industries. 

Produced at the company’s subsidiaries Less Common Metals (LCM) in Birkenhead, U.K. and Great Western Technologies (GWT) in Troy, Michigan, these alloys contain aluminum, nickel, cobalt and rare earth elements (REE). 

Great Western also holds 100-per-cent equity ownership in Rare Earth Extraction Co. Ltd. (Rareco), which owns a 74-per-cent interest in the Steenkampskraal mine. 

The current NI 43-101 report for Steenkampskraal, filed on May 31, indicates the presence of 13,823.64 metric tonnes of total rare earth oxides (TREO), including yttrium, under the indicated resource category, and 14,147.76 metric tonnes under the inferred resource category, each using a one per cent cut-off grade.

Its development program at Steenkampskraal is central to ensure a strong flow of feedstock for its downstream processing - the company intends to be one of the first to produce significant quantities of the more valuable heavy rare earth oxides, which are important materials for alloys.

At its LCM unit, the company is continuing its capital expansion plans. The infrastructure components at the new facility are being finalized and the first new furnace has been installed and commissioned and will be in commercial production on completion and approval of the customer trials. 

"This expanded capacity creates the platform for positive revenue impact through the second half of 2012," the company's CEO Jim Engdahl said in a recent release.