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N. Korea in Hunt for Lucrative Rare Earth Elements
Aug 22,2011 10:01CST
industry news
Source:SMM
North Korea is eager to dig into its rare earth elements in a fresh bid to obtain foreign currencies amid soaring prices of the minerals in the global market.

SEOUL (asahi.com) --North Korea is eager to dig into its rare earth elements in a fresh bid to obtain foreign currencies amid soaring prices of the minerals in the global market.

Experts say China may hold the key to the fate of the country's attempt as it relies on Beijing to finance the development and production of rare earth elements.

As the competition among countries over rare earth elements, crucial to the manufacture of high-tech products, intensifies, Pyongyang is paying more attention to the global race to secure the minerals.

According to North Korea's state-run Korean Central News Agency, the Minju Choson (Democratic Korea), the official government newspaper, carried reports on the topic twice this month.

The report said that Japan is dependent on China for supply of the minerals because it accounts for 90 percent of the global output and that China has moved to cut exports.

Two months before, the KCNA carried a report that North Korea is stepping up efforts to develop rare earth minerals.

The report said that mining and exploring are under way at several sites and that scientists are developing ways to use rare earth elements.

It quoted a senior official at the country's ministry of national resources development as saying, "The effective usage of rare earths has a significant meaning in terms of building an economic powerhouse."

The Choson Sinbo, the newspaper of Tokyo's General Association of Korean Residents in Japan (Chongryon), also carried a story from the North Korean capital in July about the country's endeavor to mine rare earths.

North Korea has discovered rare earth element deposits of about 20 million tons, according to the Choson Sinbo's article.

It also said that North Korea's leader Kim Jong Il is paying great attention to the rare earth project.

The reports come after there was little coverage of the subject since July 2009, when Kim reportedly visited a reprocessing plant in Hamhung, a city along the east coast, to stress a need to produce more rare earth elements.

South Korean watchers of the North cited soaring prices in the global market and the North's relatively rich reserves against the backdrop of Pyongyang's recent move.

Choi Kyung-soo, who heads North Korea Resources Institute in Seoul and was involved in projects to cooperate over the development of natural resources between the North and the South under the administration of former President Roh Moo-hyun, said that North Korean officials showed strong interest in the minerals at a meeting of experts held in Beijing in September.

Choi said North Korea is estimated to have deposits of more than 17 million tons.

But the country has yet to begin full exploration and purity and feasibility studies.

The North built the rare earth reprocessing plant in Hamhung around 1990.

Although it has been unable to put the plant in full operation due to subsequent shortages of power and supply, it has moved to step up production by introducing mining equipment from China in recent years.

The North's exports of rare metals to China stood at $16 million (about 1.27 billion yen) in 2009, according to Dong Hwan Kim, a former lecturer at the University of South Australia who published in South Korea a book on the war to secure rare earth elements.

The figure for 2010 came to $13 million, which includes exports of about 400 tons of rare earth elements.

"As long as China invests in North Korea, exports could expand to more than several thousand tons," Kim said.

According to South Korea's National Statistical Office, the potential value for key mineral deposits in North Korea is put at 6,984 trillion won (about 523 trillion yen) in the base year of 2008.

The number is 24 times that of South Korea.

Chongryon's Choson Sinbo reported that the North upgraded its national resources development bureau to the ministry in December to bolster resource utilization, significantly increasing exports of anthracite coal to China.
 

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