DESCRIPTION: Great Western Minerals Group Ltd. (GWMG) is an integrated rare earths producer. Its specialty alloys are used in the battery, magnet and aerospace industries. Produced at the company's wholly owned subsidiaries—Less Common Metals Ltd. in Birkenhead, UK and Great Western Technologies Inc. in Troy, Michigan—these alloys contain aluminum, nickel, cobalt and rare earth elements (REEs). As part of the company's vertical integration strategy, GWMG holds an option with respect to the former REE-producing Steenkampskraal mine in South Africa and seven REE exploration and development properties in North America.
Great Western Minerals Group featured in Reuters article (8/10/10)
The information provided below is based on the most recent information we have received from analysts, newsletters and other contributors to Streetwise Reports' The Gold Report or The Energy Report. We encourage you to visit the company's web site and call the company for more specifics on this company before you decide to invest.
"Great Western Minerals Group (GWMG) has signed an offtake agreement with Rare Earth Extraction Co. to buy all rare earths mined at the under-development Steenkampskraal project in South Africa's Western Cape. The mine is expected to start production in 2012 with a capacity to produce 2,500 tpa rare earth oxides, which GWMG would process into specialty alloys at its plants in the UK and Michigan, USA.
To fulfill its part in the agreement, GWMG must complete a bankable feasibility study of Steenkampskraal by December 2011 and provide agreed financing, along with starting pre-production activities by June 2011. The material will be purchased by GWMG at market prices established by independent third-party reports under a renewable 10-year agreement."
The Gold Report Interview with Jon Hykawy (06/25/10)
"JH: [Chinese REE production] is something that Great Western has to look at, and it's one of the reasons [they are] moving as rapidly as they can toward commercializing Steenkampskraal, the rare earth mine in South Africa. That mine is potentially capable of producing 5,000–10,000 tons of rare earth oxides per year; that would more than feed Great Western's entire operation and all of their customers. It would probably leave them with some additional material that they could sell to others. Frankly, it's their best route in the near term to becoming free from the restraints that the Chinese export quotas put on companies in the space.
TGR: So Great Western is looking for REEs ore from places other than China to supply its REEs metals business in Michigan.
JH: Very definitely. Both their operations in Michigan and their operation in England use rare earths. They use the term "mine-to-market" provider of rare earths; I tend to think it more as a cradle-to-grave operation because they're taking the monzonite sands out of the mine and processing them into magnet alloys, their final resting place. Great Western will ship the final alloys in completed form to customers in Japan or Korea that produce the finished magnets. . .Today it is a niche market, but you'd be surprised at the number of applications that use rare earths. . .Now, rare earths find uses in ear-bud headphones, hard drive disk motors, electronics, lighting, and on and on. . .Steenkampskraal is one of the highest grade deposits ever identified. . .has the highest concentration of rare earths identified anywhere at about 17%, and is only 90% LREEs. . .Even though this is a light deposit, every ton of raw ore you would pull out of Steenkampskraal would produce a very high volume of rare earth oxides. As a result, production of heavies. . .would be quite high. . .The number of tons that Steenkampskraal and other high-grade projects will produce is going to be significant."
View Entire Article: Jon Hykawy: REEs Explained
Jon Hykawy, Byron Capital Markets
(06/03/10)
On Track and On Time: Rareco, the owner of the Steenkampskraal monazite mine, has been granted new order mining rights by the Department of Mineral Resources of South Africa. This order allows Rareco and GWG, which has a 100% off-take option, to put Steenkampskraal back into production.
Radioactives: As with many rare earth mines, Steenkampskraal's monazite sands contain significant quantities of thorium. Steenkampskraal already possesses the permits required to store thorium, so for this mine that issue is addressed and production can resume.
. . .The Only One: Currently, GWG is the only company that has a near-term rare earth asset (something that can be brought to market within 24 months) that also has the capability to capture margin from every point in the value chain: mining, separation, purification, metallization and alloying. The rare earth industry can be incredibly lucrative, but assembling the expertise to capture value at every point in the chain is very difficult, yet with Rareco and Steenkampskraal, the expertise of Dr. Zhao and the proven abilities of the Less Common Metals and GWTI teams, GWG has that ability. We maintain our Speculative Buy recommendation as this is one of the highest-quality rare earth stories in the entire industry.
Jon Hykawy, Byron Capital Markets
(05/31/10)
"Great Western Minerals has assembled a portfolio of rare earth element (REE) properties, as well as processing capacity. These qualities make GWG unique among juniors in the space.
Our industry report recommends that investors concentrate on heavy REEs in the ground. GWG's Steenkampskraal project in South Africa is high grade, and should produce good amounts of heavy REEs.
We initiate coverage with a SPECULATIVE BUY rating and a $1.15 target price, based on a 34% discount rate and 10x terminal multiple."
The Gold Report Interview with Tom McNeil (01/26/10)
"Up in the Precambrian, we've got just about everything you can imagine. Great Western Minerals has one of the world's largest rare earth deposits. That's what's so beautiful about Saskatchewan. We're incredibly underdeveloped. We have only a million people in a geographical area larger than the U.K. So we're frontier country. You name it, we have it. We've just never had a capital market to take advantage of it."
Listen Great Western Minerals featured on Proactive Investors (6/9/10).
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