US-based former creditors of Molycorp and Shenghe Resources won an auction (June 15, 2017) to buy the rare earth processing and separation facilities at the Mountain Pass mine in California. The acquisition appears as a good bargain with $20.5M.
The mineral resources at Mountain Pass are not concerned by the transaction.
Following objections, a court in the US state of Delaware has recently upheld the decision to award production assets of the Mountain Pass mine to MP Mine Operations, a consortium uniting former Molycorp creditors ( US-based investors JHL Capital Group and QVT Financial ) and China's Shenghe Resources.
It is however possible the winning bid could come under scrutiny from the US Committee on Foreign Investment.
We see a revived interest in the only US commercial production site. China's involvement in such an asset is an important sign and could hinder some US ambitions to develop their domestic REE supply chain.
Shenghe is based in Chengdu, China and is involved in RE Projects outside of China including Greenland Minerals and Energy's Kvanefjeld uranium and rare earth mining project in Greenland.
Mountain Pass has been under care and maintenance since 2015, following the bankruptcy of previous owner Molycorp
Source: Argus Media