The Saskatchewan Research Council (SRC), which is a provincial crown corporation, has become the first and only facility in North America to produce rare earth metals at a commercial scale.

Its first batch was produced this summer at its rare earth processing facility in Saskatoon, when the SRC finalized tolling agreements with several international clients to convert individual rare earth oxides into metals using metal smelting at its facility. “Prior to the facility being fully operational, these tolling agreements allow SRC to demonstrate its technology at a commercial scale with less upfront investment into raw rare earth material,” according to a Sept. 16 press release from the organization.

Mike Crabtree, president and CEO of SRC, told CIM Magazine in an interview* that the organization recently commissioned a metal smelting unit, which turns rare earth oxides into neodymium-praseodymium (NdPr) ingots. It is the first of three units to be commissioned at the facility and, of the three, is the furthest down the rare earth metals processing stream. Currently, the facility can produce 10 tonnes of rare earth metals per month at a 99.5 per cent purity level.

“That’s a huge milestone because that’s ultimately what the industry sector wants to see,” said Crabtree. “It wants to see metals production within North America and that’s what we’re doing now.”

Crabtree said that the other two units in the vertically integrated facility, the monazite processing unit and the separation unit, are in their final stages of construction and are expected to be  commissioned in the second quarter of next year.

A major source of metals

During the production process, the monazite processing unit will turn monazite ore—which will be primarily sourced from Brazil—into mixed rare earth chloride. During the separation stage, the chloride is turned into mixed rare earth oxides that will then feed the smelters in the final stage.

Once fully operational, which is expected to be in early 2025, the plant will be able to produce 400 tonnes of NdPr metal alloy a year, enough to manufacture magnets for half a million electric vehicle motors per year. Crabtree said the SRC is hoping to expand the facility’s output sometime next year.

With production already under way at the metal smelting unit, Crabtree emphasized how quickly the construction of the facility unfolded.

“We thought that we would be doing the early stage commissioning at the beginning of next year,” said Crabtree. “We are at least four to six months ahead of our commissioning schedule. That’s really good news for us.”

Crabtree said that the metal smelting unit was completed more quickly because its construction was significantly less complex than the other two units. “Because we were that much ahead of schedule, we said, let’s procure oxides on the international market, not from China, and start metals production,” he said.

China’s control of the rare earth metals market

China is the largest producer of rare earth elements, responsible for 70 per cent of the world’s annual mine production. While the country is the foremost player in the upstream supply, it also plays a huge role in the midstream. In 2022, China accounted for 85 per cent of rare earth processing capacity. 

The SRC’s rare earth processing facility aims to curb China’s dominance on the market, while also offering a North American supply chain.

Ian London, the executive director of the Canadian Critical Minerals and Materials Alliance, praised the SRC’s initiative, but noted that, on its own, it is unlikely to have a sizeable impact on China’s share of the rare earths industry.

“[The impact would be] very little. It is a dent, but 400 tonnes [a year] will not do it,” he said. London added that the Canadian rare earths supply chain would need to manufacture the permanent magnets used in car manufacturing to gain a competitive edge.

“We have to continue to build that supply chain, and ultimately—with partners—we will connect the links of that chain,” he said. “So, yes, [the SRC’s facility] has potential. It’s an important step, and I applaud their efforts, but if you take a couple of steps back, more is required.”

London added that the SRC’s facility is just one piece in a broader puzzle to reinstate Canada’s industrial capacities and that it is “about time” work is being done to establish the midstream sector of the rare earth supply chain in Canada.

“Canada has been touting its rare earths capabilities for the last 20 years, and I’ve been a strong champion for building critical material supply chains,” he said. “To build all these energy transition materials, you need supply chains. Canada’s rich in materials, and we have a strong manufacturing base. What we don’t have is midstream.”

The SRC’s processing plant is heading in that direction. “You’re taking ore concentrates and turning it into metal. The only concern I have is that it’s taken so long,” said London.

London also noted how the SRC is building its facility directly in Canada, compared to other companies that have built their facilities overseas or in the United States.

“What the SRC is doing is onshoring, bringing the jobs here and the technology here in Canada,” he said. “One challenge in Saskatchewan is that that’s not where the manufacturing base is. So, we still have some logistic issues, but they have advanced [the industry].”

The plant’s unique features and challenges

Unlike other similar facilities, the SRC used artificial intelligence (AI) to automate the facility. Crabtree said it was a decision made early on in the facility’s development to allow it to be competitive with the Chinese market for rare earth metals.

“If we had just duplicated a Chinese plant in Canada, we would have used several hundreds of people in the workforce, which would have taken the operating costs beyond what we could afford,” said Crabtree. “What we did instead was automate the plant as much as possible and use artificial intelligence to optimize those processes.”

As well as reducing labour costs, Crabtree said automating the plant using AI also helps improve the safety of the workforce, the total output and the purity of the product.

In total, the SRC’s rare earth processing facility created 72 jobs, according to Crabtree, and the plant’s costs ran above $100 million. The facility received $71 million in funding from the government of Saskatchewan, and $30 million from the federal government. The rest of the costs were covered by the SRC.

While the plant is enjoying a wave of success, the team behind the SRC’s rare earth processing facility had to overcome many obstacles.

“This is a first-of-a-kind facility—not in Saskatchewan, not in Canada, but in the world,” said Crabtree. “Our design, our engineering, our construction, our commissioning teams see problems every single day of the week.”

Moreover, when China introduced export bans on processing technology related to rare earth metals in December 2023, it brought a slew of obstacles for the SRC.

“When you need machines, you go to China to get it built,” said Crabtree. “So, we were forced to go back and think about how we were going to build the equipment ourselves.”

Notably, as part of the facility’s separation stage, the team had to weld

plastic tanks, but conventional welding techniques were not strong enough and the tanks were leaking. The team had to go back to the drawing board and develop a completely new method for plastic welding.

“That was a problem where if we hadn’t solved this, we could have been in a significant amount of trouble, so we had to go back and work out how we were going to do that,” said Crabtree. “Now, we’ve developed a really quite unique plastic welding technique that allows us to construct these large tanks.”

Through all the hardships and wins, the SRC’s rare earth processing facility has the wind in its sails. According to Crabtree, the new plant could be a game changer for Canada to take its share of the rare earth elements industry.

“It’s going to be something very important, [on the] economic and strategic security [fronts],” said Crabtree. “What we’re doing here is proving that this can be done highly efficiently, highly cost effectively, in Canada and in North America.”