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| Prediction: Largest Economic Opportunity of the 21st Century It's only about the size of a small coffee pot. But one expert calls it the "largest economic opportunity of the 21st century." |
| Secret Rare Earth Deposit Hidden Beneath 100 Feet of Water | ||||||
| By Keith Kohl | Wednesday, November 25, 2015 | ||||||
 A remote location in central Texas hides a mineral secret... The U.S. Geological Survey described it as one of the greatest deposits of rare earth minerals in the world. This deposit is so massive that its discovery resulted in the identification of five previously unknown minerals. In total, over 47 different minerals would be discovered to be present there — many of them found only in the world's most remote locations. The deposit was so phenomenally important in the time of its discovery that it was once owned by none other than Thomas Edison. Let me tell you...
The Legend of Barringer Hill The mineral wealth contained at Barringer Hill in Llano County, Texas was first revealed in 1887 when its owner, John Barringer, was doing some prospecting. Barringer found an outcropping of a heavy greenish-black ore, and although he was not a geologist, he knew this rock was special. So Barringer collected several samples and sent them in to scientists in New York and Philadelphia for testing. When testing on the ore was completed, the lab technicians were stunned... A whopping 47 different minerals were present in the ore samples Barringer had sent in — five of which were totally new to science. The ore from Barringer Hill was like nothing geologists had ever seen. In the words of one USGS geologist who visited the deposit shortly after it was discovered:
But of all the minerals present in the ore from Barringer Hill, there was one that triggered substantial interested: gadolinite
Gadolinite is a silicate mineral that consists of rare earth elements cerium, lanthanum, neodymium, yttrium, and beryllium, as well as iron. And it has one very special property... Gadolinite will glow when heated. This characteristic (called “pyrognomic”) was known to scientists prior to the discovery of gadolinite at Barringer Hill. But gadolinite was only known only to exist in Russia and Norway. And it was outrageously expensive. So the discovery of gadolinite in Texas immediately grabbed the attention of Thomas Edison, who was looking for a suitable material to be used as a filament in the incandescent light bulb at the time. And in 1889, Edison's Piedmont Mining Company acquired Barringer Hill for $5,000 or $10,000 (sources vary) in gold. But by 1903, Edison’s company had experimented with the gadolinite and all 47 minerals found at Barringer Hill and found no good use for them as a filament in the incandescent light bulb. Just a few years later, the mine was closed. Edison's Piedmont Mining Company only conducted relatively small-scale mining operations for a short time. That means the mineral wealth at Barringer Hill is still relatively untouched. And there could be billions of dollars' worth of rare earth elements waiting to be mined. But before you grab your pick-ax and bucket, there's one catch... Barringer Hill is now laying 100 feet underwater.
Every Hill Shall Be Made Low A few years after the Barringer Hill mine was closed, the land was acquired by the Lower Colorado River Authority, a public utility created by the State of Texas. The LCRA built a dam, redirected water from the nearby Colorado River, and flooded Barringer Hill and the surrounding areas to create a water reservoir called Lake Buchanan. Today, Lake Buchanan is surrounded by a quiet community of nice parks and privately owned cottages and houses, which are commonly rented out to vacationers and fishermen. So any hope of getting to any of the rare earth elements out of the Barringer Hill deposit is a pipe dream.
There are no official estimates of the mineral resources contained at Barringer Hill. And the deposit has been underwater for some 80 years. But a significant rare earth deposit in the United States could be of massive importance right now. There is currently only one rare earth mine in the U.S., and it was just closed this year due to the owner's financial problems. Back in August, Molycorp (OTC: MCPIQ) shut down its Mountain Pass rare earths mine in California among production issues and falling rare earth prices. As a result, the company filed for chapter 11 bankruptcy protection and put the Mountain Pass mine into “care and maintenance” mode. The United States is a net importer of rare earth products, bringing in over $200 million of rare earths annually. China continues to dominate the global supply of rare earth elements, providing nearly 90% of the world's total mined inventory. The country is also the world's largest consumer, accounting for about 80% of total demand. New rare earth deposits have been found around the world and are starting to be mined. However, all of them are a decade or more behind in creating an extraction and processing supply chain as robust as China's. Meanwhile, world demand remains robust. In places like China, rare earth demand is expected to increase by 50% in the next five years. Despite their relative scarcity, rare earth elements have proved extremely useful in industrial applications and have paved the way for new advancements in technology. Molycorp's bankruptcy over the summer has certainly deterred plenty of investors from rare earth elements. However, with the ever-increasing importance of rare earths in modern technology, I still believe there is opportunity to be had. I recently uncovered a new rare earth play I'm so excited about that I simply can't sit still. The company is a tiny Canadian junior with a market cap of only $20 million. But it has an ace up its sleeve. This company recently completed a Preliminary Economic Assessment (PEA) on its flagship rare earth deposit. The PEA projected annual gross revenue of nearly $100 million over a 20-year mine life. That's nearly five times the current market cap... every year for 20 years. To learn more about this company, check out my latest report. Until next time,
Keith Kohl A true insider in the energy markets, Keith is one of few financial reporters to have visited the Alberta oil sands. His research has helped thousands of investors capitalize from the rapidly changing face of energy. Keith connects with hundreds of thousands of readers as the Managing Editor of Energy & Capital as well as Investment Director of Angel Publishing's Energy Investor. For years, Keith has been providing in-depth coverage of the Bakken, the Haynesville Shale, and the Marcellus natural gas formations — all ahead of the mainstream media. For more on Keith, go to his editor's page.
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