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Tuesday, 2 October 2012
Great Western Minerals to conduct yttrium oxide purification assessment for U.S. Department of Defense
Great Western Minerals Group (CVE:GWG) said Monday that one of its subsidiaries has been chosen by the U.S. Defense Department to conduct a supply chain assessment for high purity yttrium oxide.
The company's rare earths processing subsidiary, Great Western Technologies, of Troy, Michigan, was chosen by the Department of Defense, Great Western Minerals said in a statement.
Yttrium oxide is used in several defense applications like polishing compounds for precision lasers and thermal barrier coatings for jet engines.
"We intend to advance previous Department of Defense research to uncover the extent to which the defense industrial base has the capacity to produce high-purity yttrium oxide to support critical defense programs," interim chief executive Robert Quinn said in a release.
"The Defense Department's investment in our research is an acknowledgment of yttrium's strategic role in national defense and the potential of Great Western Minerals Group to meet future needs," Quinn said.
Almost all high-purity yttria is produced in China, where about 94 per cent of the world's rare earth oxides are also produced.
The Department of Defense has projected an annual shortfall of 93 short tons of elemental yttrium from domestic sources by 2013.
Great Western's stock gained 1.33 per cent to hit 38 cents on the TSX Venture Exchange this afternoon.
Rare earth stocks have struggled recently as a flood of new production into the market is likely to cause a further slide in prices, with new production announced from Molycorp (NYSE:MCP) and Lynas Corp. (ASX:LYC).
In the past six months, the Market Vectors Rare Earth/Strategic Metals ETF has fallen over 20 per cent, according to a Reuters report.
Great Western Minerals is an integrated rare earth processor. Its specialty alloys are used in the magnet, battery, defense and aerospace industries.
Produced at the company's subsidiaries in the US and the UK, these alloys contain aluminum, nickel, cobalt and rare earth elements.
And as part of the company's vertical integration strategy, Great Western also holds 100 per cent of Rare Earth Extraction Co. Limited, which owns a 74 per cent equity interest in the Steenkampskraal Mine in South Africa.
The company also holds interests in four active rare earth exploration properties in North America.