S&T Committee: Written evidence SIM Strategically important metals: 29 March 2011

SIM Author SIM Author 00 Department for Business, Innovation & 18 Gareth P Hatch Skills 00a Supplementary 01 G R Chapman 19 Design Council 02 Nicholas Morley 20 Minor Metals Trade Association (MMTA) 20a Supplementary 20b Supplementary 03 The Institute of Materials, Minerals and 21 Chatham House Mining (IOM3) 03a Supplementary 04 University of Strathclyde and University 22 The Royal Institution of Chartered of Oxford Surveyors 05 Aerospace and Defence Knowledge Transfer Network, Materials and Structures National Technical Committee (NTC) 06 Wolf Minerals Ltd 07 The Environmental sustainability Knowledge Transfer Network (ESKTN) 07a Supplementary 08 Society of Chemical Industry Materials Chemistry Group 09 Mineralogical Society of Great Britain and Ireland 10 The Geological Society of London 10a Supplementary 11 Natural History Museum 12 Construction Materials Group, Society of Chemical Industry 13 Research Councils UK 14 British Metals Recycling Association 15 British Standards Institution (BSI) 16 The Cobalt Development Institute 17 The Royal Society of Chemistry

Written evidence submitted by the Department for Business, Innovation and Skills (SIM 00)

Strategically important metals inquiry

1. Is there a global shortfall in the supply and availability of strategically important metals essential to the production of advanced technology in the UK?

1. The current situation is that whilst there is currently no significant shortage/lack of availability of key metals, the situation could rapidly change. The UK operates in a global market and largely requires the same materials as other developed economies, and as the world economy moves towards high technology and low carbon manufacturing competition for strategic metals and resources in general will increase.

2. Whilst there have been no reports of shortages, various industry sectors have expressed concerns relating to access and security of supply rather than scarcity of key metals and minerals. However there are differences in opinion on which resources are at risk as well as concerns that some shortages of materials might be short-lived and that others are likely to emerge. 3. The UK, EU and other developed economies are consuming some natural materials (not just metals) at an unsustainable rate. Although reserves of most critical materials are sufficient to meet demand, pressure on untapped reserves may increase, with associated environmental impacts. Critical metals are produced in highly polluting and carbon intensive industries, accounting for 5-10% of global GHG emissions. It should also be noted that UK businesses depend on a wide range of materials. 4. There are some concerns regarding the supply of metals such as platinum and tantalum; with the former likely to become increasingly scarcer, whilst supplies of the latter could possibly be disrupted by geo-political factors. (There are large, mostly undeveloped deposits in the Democratic Republic of Congo).

5. The EU released a report1 in June 2010 which listed 14 ‘critical’ materials that could soon be in short supply unless the trade and policy measure of the EU were modified to ensure steady imports and domestic exploration and recycling promoted. The report states that EU economies would be damaged if the materials were inaccessible either due to shortage or export embargo, given that they are produced in a handful of nations only. The 14 metals and minerals are antimony, beryllium, cobalt, fluorspar, germanium, graphite, indium, magnesium, niobium, platinum group metals (PGM), rare earth elements (REE), tantalum and tungsten. Although China and Russia are significant producers of cobalt there are significant reserves in

1 Critical Raw Materials in the EU – Issued by the EU’s Raw Materials Supply Group

the Congo and others under development e.g. New Caledonia and Madagascar. Lithium is not included but EC sources consider that may soon change if the use of lithium in electric vehicle batteries increases dramatically. The increased use of the materials in new and emerging technologies suggests that demand for them could triple by 2030.

6. The report cited the importance of changes in the geopolitical- economic framework that impact on the supply and demand of raw materials. These changes relate to the growing demand for raw materials, which in turn is driven by the growth of developing economies and new emerging technologies. Moreover, many emerging economies are aiming at reserving their resource base for their exclusive use. In some cases, the situation is further compounded by a high level of concentration of the production in a few countries.

2. How vulnerable is the UK to a potential decline or restriction in the supply of strategically important metals? What should the Government be doing to safeguard against this and to ensure supplies are produced ethically?

Vulnerability

7. In common with other countries, the UK is potentially vulnerable to shortfalls in supply of key metals. As there is no EU mining capacity for some materials (antimony, cobalt, iodine, molybdenum, and zirconium); they are all imported into the EU. For other materials (bauxite, graphite, iron ore, tin and phosphate rock) the EU produces less than 25% of its requirement. Brazil provides 54% of the EU’s imports of graphite and 28% of its imports of mined cobalt. China provides 28% of the EU’s imports of antimony ores and concentrates.

8. The situation regarding rare earth elements (REEs) is of particular concern. There are 17 REEs which are used in a wide range of applications, particularly low carbon technology. These metals are integral to the transition to a low carbon manufacturing economy and are also important to other key UK industry sectors such as transport, defence and security. A stable supply will be important for achieving the transition to a green economy, securing green growth and re-balancing the economy towards high value-added manufacturing. The term (Rare earths) is somewhat misleading as they are relatively abundant in the earth’s crust, some even more abundant than copper, lead, gold, and platinum; however they tend to be found in remote locations and small concentrations which render (their) mining expensive.

9. Although China has the largest share, territories such as the CIS, United States and Australia have significant reserves of rare earths. Recent reports indicate there is an ample supply especially within the US, though many of these reserves are not at present exploited; collaborative science is vital in predicting and finding such deposits. There are known reserves of rare earth ore in Canada, South Africa, Brazil, Vietnam, and Greenland.

10. China is expected to remain the main world supplier in the near term due to the time required to develop resources in operational mines elsewhere. A number of mines are likely to open outside China (United States, Australia and Canada) by 2014. Supply of particular Rare Earths may be limited over the medium term.

11. World demand for rare earth elements2 is currently estimated at 134,000 tons per year, with global annual production of around 124,000 tons - The shortfall is covered by existing stocks. World demand is projected to grow at 8-11% per year between 2011 and 2014 to 170,000 – 190,000 tons annually by 2014 (Source: IMCOA, Roskill and CREIC3). New rare earth mining projects can take 10-15 years to reach production, however a number of projects are due to come online in the next few years. In the long run global and undeveloped reserves should be sufficient to meet demand. China currently has 97% of the world’s short-term production capacity of rare earths. China’s market share is forecast to decline as productive capacity increases elsewhere.

12. The highest growth is expected for magnets and metal alloys, as required in hybrid and electric vehicles. Hybrids are expected to gain an increasing market share, but other applications such as wind turbines will compete for the essential materials. Although total world supply is forecast to exceed total world demand, shortages are expected for key heavy elements such as dysprosium and terbium.

13. Supply of rare earths at the present (and in the immediate future) is therefore reliant on China responding to the increase in demand and adjusting output. Concerns were heightened early in June this year when the Chinese government announced that mining rights for the rare earth elements would be restricted to a small number of Chinese state-controlled mining companies. The announcement did not specify the exact number or identity of these companies, but state media reporting made it clear that it referred to the four companies which already dominate the white-market supply of rare earths in at least one Chinese province each.4 This followed the capping of production levels for 2010, and the imposition of a moratorium on all new mining licenses until 30th June 2011. China’s Ministry of Land and Resources published its six-monthly review of rare earth export quotas on 21st July 2010, cutting them far more than is usual, and hitting foreign-affiliated companies hardest. China’s Ministry of Finance announced on 14th December 2010 that it would increase rare earth export taxes in 2011. The announcement did not specify the extent of the increases, nor which rare earths they would target, nor whether they would apply to raw, processed, intermediate or final rare earth

2 Rare Earth Elements – The Global Supply Chain – US Congress Research Paper, July 2010

3 IMCOA: Industrial Mineral Company of Australia, Roskill: http://www.roskill.com/ CREIC: China Rare Earth Information Centre

4 These are: Baotou Steel Rare Earth Hi-Tech Company; China Minmetals Company; Jiangxi Copper Corporation; China Nonferrous Metal Industries Foreign Engineering & Construction Company.

goods. China’s rare earth export taxes currently apply to raw and processed rare earths only, and range from 15 to 25 percent.

14. The results of this action, which effectively reduce rare earth exports by over 70% (for the second half of 2010 compared to 2009), will be twofold: protection against foreign ownership of strategic resources, and incentives for foreign companies to relocate manufacturing plants to China. We assess these to be the main motivations behind China’s policy. In addition, prices are likely to be forced up in the short-medium term. The increased restrictions are also likely to deepen international concerns that China may be intentionally hoarding its reserves of rare earth metals and other key raw materials at a time of rising global demand; yet if this were China’s intention, we would expect it also to impose export restrictions on the export of finished rare earth products – and it has not done so. Reports of a temporary cessation of rare earth exports from China to Japan – during a period of political tension – further illustrate the potential vulnerability of the West.

15. Research for Defra has sought to identify those resource issues which represent the greatest threats and opportunities for UK businesses; and to assemble data on the nature and scale of those threats and opportunities, and the business understanding of these. This research covers a wide range of biotic and abiotic resources, including key metals, and is based on a review of literature and engagement with key sectors. It will be published shortly.

Safeguarding supply

16. Concerns have heightened since the recent China-Japan dispute. Therefore whilst options in terms of securing supply are perhaps limited, other countries are already taking pre-emptive/contingency measures to safeguard supply.

17. Such measures are largely contrary to the UK’s traditional free market approach to economic policy. Unilateral action aimed at securing supplies of critical metals should be subject to very close scrutiny and can be proposed only after careful analysis of the long-term costs and benefits involved, with particular attention to the environmental consequences.

18. The UK possesses some rare earth reserves in the tailings of disused tin mines in Cornwall. However given the marginal economics and limited success in recovering rare earths from operational tin mines overseas, these are unlikely to be economic.

19. An issue that any country intending to develop rare earth production facilities must consider is the potential lack of qualified workers. Very little extraction and refining knowledge exists outside China and such knowledge will have to be developed.

20. China’s export restrictions create a two-tier pricing system, where raw and semi-processed rare earth prices inside China are much lower than on the international market. (There are no current restrictions on the export of finished rare earth products from China.) Consequently, there has been much speculation that China’s objective may be to attract foreign firms with low domestic prices to develop high value-added technology industries within the country. However, China’s Ministry of Land and Resources has said publicly that the main intention of the quotas is to protect reserves from environmentally reckless exploitation. Some commentators have predicted the cessation of licences for rare earth exports from China in 2014, but Beijing has denied any plans to choke off supplies. There are currently 32 licensed exporters of rare earths in China. China’s Ministry of Commerce said in November that China needed to improve the management of rare earths by a combination of measures including [but not limited to] export quotas, export taxes, and regulation of exporters. (Other measures could include extraction licences and export licences.) The UK Government supports free trade and therefore believes an export ban by China would be anticompetitive and undesirable in the long run. Nevertheless, a cessation of Chinese exports would have a number of long-term effects:

• It would improve the economic viability of non-Chinese sources of rare earths that were previously undercut by Chinese supply, thus increasing global security of supply. • Such a long-term signal may be helpful to non-Chinese mining projects in raising finance and in long term planning. It may also work as an incentive to develop specialist skills in extraction and refining of rare earth metals. • These new mines would be expected to operate to much higher environmental standards than is currently the case with most Chinese mines. Chinese mines in the south of China are generally regarded as having an extremely poor environmental profile. The major producer in north China has also been criticised in this respect.5 Thus the export ban would enable not only a newer but also greener supply chain to be established. • China could become the de facto monopoly supplier of goods dependent on these important materials, if the cost of alternative sources were to remain relatively too high. • Non-Chinese businesses would still be able to purchase value- added items (magnets, motors etc) from Chinese sources, or establish more expensive non-Chinese supply chains albeit with a better and more transparent environmental profile. This principle already applies in many other UK industrial sectors.

21. The main negative effect of the export restrictions is likely to be some short-term supply tightness, particularly if the first two major non-Chinese rare earth projects are delayed. However such tightness will also be an incentive for the acceleration of these and other projects.

5 Baotou Steel Rare Earth Hi-Tech Company

22. It may be that China will tempted by higher prices to continue the export of rare earths. This could impact on the economic viability of the new non-Chinese mines, and thus leave China as the possible sole supply of rare earths. There is also the ‘grey’ market to consider – the considerable volume of rare earths that circumvent the export quotas and are mined and exported illegally from China. The degree to which these exports are targeted by enforcement authorities will also affect the viability of non-Chinese mines. If China does continue to export rare earths, the possibility remains that no alternative, greener, sources of supply will become viable.

23. The UK could encourage the accelerated development of commercially viable sources of rare earth in other countries more likely to be amenable to exporting such materials to the UK and/or countries which might supply components for or complete electric vehicles.

24. Scientific research has an important role to play and the UK Research Councils are a source of relevant information in support of strategic approaches to tackling the issue. The British Geological Survey, a centre of the Natural Environment Research Council, and the UK’s premier centre for earth science information and expertise, monitors global metal production and trade. Research Councils UK (RCUK) has provided a separate submission to the Committee.

3. How desirable, easy and cost-effective is it to recover and recycle metals from discarded products? How can this be encouraged? Where recycling currently takes place, what arrangements need to be in place to ensure it is done cost-effectively, safely and ethically?

25. Currently, re-use and re-manufacture of components rich in strategically important metals would be preferable to recycling on a cost and environmental basis. In many cases, particularly for REEs recycling is labour intensive and very costly. Recycling of REEs is currently not economically viable and currently makes limited contribution to demand; however if the cost of REEs continues to rise recycling becomes more realistic. Therefore, it is important to design products so that valuable components can more easily be recovered and whenever possible, re-used. Reducing the amount of resources such as rare earths used in various production processes and applications is also necessary, in addition to looking into alternative materials. Research is underway in Japan which has had some success. The Japanese firm Hitachi has developed machinery which can recover rare earths from discarded disk-drives eight times faster than manual labour. The company plans to get 10% of its rare earth needs through recycling in 2013.

26. The UK is looking at targeted measures to encourage, incentivise and enable improved resource efficiency through the Review of Waste Policies, the new strategic steer for Defra’s resource efficiency delivery body, WRAP, the Natural Environment White Paper, and through the Roadmap to a Green Economy being developed by Defra, BIS and DECC. It is also important to continue working with Businesses and Trade Associations to raise awareness, and spread best practice.

27. Internationally, Japan is thought to have only one or two facilities left that are able to recycle rare earths from scrap, a costly process which has largely passed to China, according to industry sources. To be cost-effective in Japan, the price of rare earth metals would have to rise 10-fold, but with further price rises likely, the likelihood of more REE recycling increases - Over the past five years, the price of neodymium, used in such products as computer hard disks, has risen about six-fold and that for dysprosium, used in data storage devices, eight-fold. 28. It is worth noting that the current recycling rate for REEs in most countries is around 1%, a figure consistent with that for other metals. 29. There are well-established methods for the recycling of most batteries containing lead, nickel-cadmium (NiCd), nickel hydride and mercury, but for some, such as newer nickel-hydride and lithium systems, recycling is still in the early stages and not designed for the recovery of their rare earth contents.

30. There is no collection infrastructure in place for nickel-metal hydride (NiMH) batteries yet. This is because of the long time span of the batteries coming into the recycling markets. There needs to be proper separation and segregation of rare earth-related components for optimum recovery.

31. Rare earth magnets are fragile and fracture very easily. It is estimated that between 20-30% of the rare earth magnet is scrapped during manufacturing because of breakages or waste cuttings such as swarf and fines.

32. There are potentially a number of extraction processes but none of them developed commercially due to drawbacks on yields and cost. The most attractive appears to be treatment with liquid metals. Little progress has been made in 15 years or so. Therefore there is potential to undertake some development not only to avoid possible supply shortage but also to retain the rare earths in the UK.

33. The UK will also host the next EU Innovation Forum in March 2011 which will consider and help raise awareness of resource security issues. 34. The UN Environment Program has also called for a global drive to recycle rare earth metals, warning that supplies of rare earths may be exhausted within 40 years.

4. Are there substitutes for those metals that are in decline in technological products manufactured in the UK? How can these substitutes be more widely applied?

35. In terms of rare earths, there are currently no reliable substitutes. Other metals have been tested, but with no success. Research is on-going; however the likelihood of developing viable alternatives in the near future is remote.

36. It also very much depends on the need of the process or product it is being used for. Some low carbon technologies have very specific material needs and alternatives are not always readily available. We need to support/encourage UK companies to assess their own particular situation, understand the resources they use and mitigate risks to supply. There may be more of an issue for smaller companies than large who may generally have a better awareness of the issues. 37. This is possibly an opportunity to encourage/support UK businesses to develop alternatives, new processes, develop new markets etc. For example no feasible replacement for the rare earth magnets used in electric vehicle motors has been discovered. Minimisation of rare earths in existing magnets will only result in small reductions in material usage compared with the overall demand. 38. The reduction or replacement of dysprosium usage is a high priority on many research agendas as this element will suffer the tightest resource constraints. Both design and technological solutions to achieve this should be investigated.

39. Electric motors which do not require permanent magnets are the most likely way of reducing or eliminating rare earth in electric vehicle magnets. However, for technical reasons rare earth technology is favoured in the current generation of hybrid vehicles.

40. Despite some historic expertise, negligible research into magnetic materials now occurs within the UK. When compared to the efforts of Japan, China and the USA, public and private funding of research in this area is minimal.

41. The demand for Rare Earths in batteries will naturally decline as manufacturers shift from NiMH batteries towards lithium-based technology. (Consequently, this may cause supply issues around lithium.) Even with improvements NiMH batteries are unlikely to compete with lithium-based alternatives in performance terms.

42. Many alternative battery technologies are being investigated as improvement of battery performance is a key consideration in the future development and implementation of electric vehicles. None of these is heavily reliant on rare earths at the current time.

43. The UK has reasonably strong research in this area, though may not have the manufacturing base to exploit developments in a commercial setting.

5. What opportunities are there to work internationally on the challenge of recovering, recycling and substituting strategically important metals?

44. There are existing and forthcoming initiatives at EU level such as the resource efficiency flagship initiative, Raw Materials Initiative, Low Carbon Roadmap to 2050, and work on Sustainable Materials Management, which all

provide good opportunities on particular aspects. The UK Government is working to ensure these are all joined up to provide a coherent approach under the EU2020 Strategy. 45. Work is planned under FP7 Nano-sciences, Nano-technologies, Materials and new Production Technologies looking at novel materials for replacement of critical materials (platinum group metals and rare earths).

46. The EU has launched a Consultation aimed at business to gather information on the EU interest with regard to export restrictions on raw materials that might impact EU business in China, the EU or third countries.

Department for Business Innovation and Skills

20 December 2010 Supplementary written evidence from Professor Robert Watson, Chief Scientific Adviser, Department for Environment, Food and Rural Affairs (SIM 00a)

Please find the responses to the questions from Graham Stringer, MP

REACH

The primary aims of REACH are to enhance protection of human health and the environment, and to increase industry competiveness and innovation. This is done by making industry responsible for what they place on the EU market through the hazard assessments and advice on safe use and risk management they include with their registrations.

Manufacturers or importers of so-called “new substances” have had to notify data on potential risks since the 1980s. However, there are also about 30,000 chemicals on the EU market that predate that requirement for notification and which are manufactured or imported in amounts of 1 tonne or more a year. Only a few hundred of those “existing substances” have been subject to full risk assessment and there are significant gaps in publicly available knowledge about even the highest production volume substances (1000+ tonnes). That is an alarming knowledge gap that REACH exists to fill.

It is too early to say to what extent the aim of increasing industry competiveness and innovation will be achieved. By placing new and existing substances on an equal footing, REACH removes a strong signal against innovation. In addition, REACH puts a much greater emphasis on finding safer alternatives for dangerous chemicals, which will also be a strong incentive for innovation through the supply chain.

Licence costs

An importer or manufacturer of a substance, e.g. titanium, must register it with the European Chemicals Agency (ECHA) in Helsinki. Registration means producing a dossier of information, including:

• intrinsic properties and hazards of the substance; • amount of manufacture/import; • identified uses and uses advised against; • guidance on safe use; • information on exposure.

One of the key objectives in REACH is to obtain and share information about the properties of substances being manufactured, supplied and used in the EU. This ensures that registrations use existing data rather than commissioning new studies. REACH prohibits the duplication of animal testing. This data sharing can then be followed up by a joint registration. Alternatively a registrant can go it alone.

A registrant has to pay a fee to ECHA. The highest fee payable is €31,000 (by a large company which manufactures/imports more than 1,000 tonnes of a substance each year and which chooses not to participate in a joint registration). A range of reduced fees is available for joint registrations, lower tonnages and smaller companies, with €120 being the lowest fee.

No registration fees or licences are required under REACH before a downstream user can handle a substance.

REACH provides for manufacturers and importers of a substance to join together in Substance Information Exchange Forums in order to share data, avoid duplication of any new testing, and prepare a joint registration. However, in addition manufacturers of some substances have set up consortia to manage the data gathering, although these are not a requirement of REACH. Letters of access to unofficial consortia cannot be policed by REACH although they would, of course, be subject to competition law.

Thallium and landfill

A specific reference to Thallium going to landfill was also made. Under REACH, restrictions can be placed on the manufacture, marketing or use of dangerous substances. No such restrictions exist in the case of thallium or its compounds. In addition producers of recovered substances do not have to register under REACH if the substance has also been registered as a virgin material. It is therefore difficult to see how REACH can be responsible for thallium waste ending up in landfills.

More generally on the avoidance of strategic metals going to landfill, one of the alternatives approaches we do favour is improved resource use and secondary recovery as a way of companies both handling risk and developing alternative sources of supply for key materials. We need to do more to move the focus up the waste hierarchy to prevent waste originating and to increase secondary recovery of valuable materials.

This is something we are already examining. For example, we have tasked WRAP, in our draft strategic steer, to increase their focus on materials efficiency, thus avoiding waste at the very outset, but also ensuring maximum economic benefit from those materials used. They are working with businesses and looking at the opportunities presented by new business models and the barriers to the recycling of precious metals, such as actual product design to aid in the easy separation and recyclability of materials.

I do hope this response is helpful to your inquiry.

Professor Robert Watson Chief Scientific Adviser Department for Environment, Food and Rural Affairs

16 March 2011 Written evidence submitted by G R Chapman (SIM 01)

Strategically important metals

I worked for 30 years in the British Geological Survey, chiefly on the DTI-funded Minerals Intelligence Programme. I advised the DTI on, inter alia, the strategic stockpile (1983 – 1996) and was latterly an accredited NATO expert advising that organization’s Industrial Policy Committee on raw materials supply.

General remarks:

• It is important that the Committee should give sufficient weight to the economic and geopolitical aspects of these issues and not be too engrossed in scientific and technological aspects. • The methodology for selecting the metals to be included should be carefully considered and also transparent. Relevant factors differ markedly between different metals. • The Committee is right to state that ‘the exact impact of such a decline [in availability] on UK high technology industries is unclear’. Assessing this impact is likely to be the most difficult part of the task.

Comments on the Committee’s terms of reference:

1. Is there a global shortfall etc.

1.1 Historically, global shortfalls have led to upward price movements that in turn lead to increased production. However in the case of minerals and metals new production capacity can take years to bring on stream. Any decision about new capacity is governed by perceptions about the duration of the supply problem. 1.2 For industrial consumers the price of some metals is far less important than reliability of supply. 1.3 Obviously consumers prefer to pay the lowest negotiable prices for raw materials but diversification of supply with a consequent price ‘penalty’ may be thought worthwhile in order to ensure supply.

2. How vulnerable is the UK to etc. 2.1 The USA has kept a stockpile of strategic/critical minerals for several decades, although it is now reduced in scope. It was very costly to maintain. 2.2 HM Government formerly had a small stockpile of strategic minerals. It was set up by the DTI in 1983 and its abolition was then announced in November 1984. In fact the last sales were not made until 1996. The materials concerned were never disclosed by the DTI but in its issue of 30th July 1985 the commercial journal 'Metal Bulletin' published estimates for tonnages of certain metals and alloys in the stockpile. The list comprised forms of chromium, cobalt, manganese and vanadium. 2.3 You should also be aware of the House of Lords (1982) Strategic Minerals. Report of the Select Committee on the European Communities. HMSO, London. Although produced twenty-eight years ago, it may be useful to look at the methodology used to reach its conclusions. Essentially this report defined 'strategic minerals' on the basis of the twin components of 'criticality' and 'vulnerability'. Criticality was based on the view that the mineral was essential to the national economy. Vulnerability was based on the proportion of domestic consumption, which was imported and the number of overseas supply sources contributing to that supply. The fewer and more unstable the sources the more vulnerable the supply.

3. How desirable, easy and cost-effective to recover and recycle etc. 3.1 I am not aware that there is any difference between ‘recover’ and ‘recycle’ The former is tending to be used by commercial entities as a fashionable catchword. 4. Are there substitutes for those metals etc. 4.1 Substitution lies under similar constraints as investment in new capacity. It may be technically and scientifically feasible, but commercially impossible in the short and medium terms for reasons to do with contractual specifications 5. What opportunities are there to work internationally etc. 5.1 I comment on this question simply to point out that it uses the word ‘substituting’ in the vulgar sense used by football commentators. This word does not mean ‘replacing’ – which is the meaning intended in your document. In football it doesn’t matter. In materials science it does.

G.R.Chapman PhD FGS CGeol

December 2010 Written evidence submitted by Nicholas Morley (SIM 02)

Inquiry on the Importance of Strategic Metals to the UK

1. Is there a global shortfall in the supply and availability of strategically important metals essential to the production of advanced technology in the UK?

1.1 In absolute terms, there is no scarcity of metals. Copper is the only element where this subject has been seriously debated, but even in this case the resource optimists appear to have the most convincing arguments at present.

1.2 At the start of the Industrial Revolution many metals were mined in the same country in which they were consumed (although of course international trade in certain metals such as tin goes back thousands of years). There is an increasing, long term trend of metals being mined in different countries from which they are consumed. Poor governance in some of these countries, limited commitment to free markets, increased demand for metal resources due to increased population and wealth, and use of certain speciality metals in applications important for the “Green Economy” are all factors in the increased interest in strategic metals

1.3 China is a special case where there is a combination of large speciality metal reserves, a potentially huge internal market for products made from these metals, and an explicit economic development strategy to supply high value added products rather than commodity metals or their ores.

1.4 New mines typically take 7‐10 years to develop. Therefore there will a lag between the imposition of short term measures such as quotas and the introduction of new supplies. There is also the complication that many speciality metals are by‐products or co‐products from the manufacture of other metals. Hence the output of these metals are influenced by the demand for metals in other applications and material cycles.

1.5 Arguably, UK and Western companies have paid too little recent attention to raw material risk which has allowed dominant positions that China in particular now has in some metals. So to a extent the problems in rare earths and some other metals is caused by what might now be seen in hindsight as a naïve belief in the permanency of free markets for their raw materials and an unwillingness to pay a premium in order to reduce raw material supply risk.

1.6 How quotas play out in terms of availability of metals can be complex. There may be no shortage of metals but rather increasing competition between different applications for strategic metals, with their inclusion in products where price sensitivity is the least important. There will be increasing competitive advantage for companies located inside China (in the case of rare earths) for both price and availability. This has to be set against the risk of locating factories in China that will for example be dependent on supplies of rare earths from mines with generally poor environmental records and where the other issues of doing business in China such as intellectual property protection may be significant.

1.7 In the medium to long term we believe that a greater number of mines in different countries will be developed and the problem will correct itself. In the short to medium term there may well be supply issues with certain metals and consequent price volatility. 2. How vulnerable is the UK to a potential decline or restriction in the supply of strategically important metals? What should the government be doing to safeguard against this and to ensure supplies are produced ethically?

2.1 The impact on the UK is likely to be less than in countries such as Japan and Germany, due to its smaller high technology manufacturing base. There will be some direct impacts, but we believe that mostly the impacts will be indirect through suppliers in other countries. An example is the defence supply chain, which is rightly concerned about restrictions of supply based on geopolitical issues, and where countries such as the USA are far more exercised on this issue than the UK. We are not aware of studies to define the significance of the risk to the UK apart from a current Defra project on resource risks, which might have addressed this issue and which will report shortly. Hence it is difficult to comment on the degree of vulnerability. However energy security issues in our opinion could have a far greater direct impact on the UK than material security issues.

2.2 There are four responses possible to material security issues: Negotiate privileged access Stockpile Substitute Resource efficiency measures such as minimise use, extend product lifetime and recycle Possible stockpiling at an EU level, similar to what occurs in Japan has been proposed, but is generally not preferred in free market economies such as the UK. Also the timescale over which it could operate (typically months rather than years) is not sufficiently long to address some of the speciality metal supply issues.

2.3 If supplier countries are members of the WTO (such as China), then mechanisms do exist to encourage the removal of restrictions on free trade. Although to comment on these is beyond our area of competence, this would seem an obvious arena in which the UK Government could act.

2.4 The Government, through the Technology Strategy Board, could provide innovation funding to develop substitutes, although the timescales on commercialising these is likely to be of the same order as opening new mines as sources of supply.

2.5 A mix of resource efficiency measures could be implemented more quickly and would be a useful role for government and would contribute to security of supply and is highly likely to contribute to overall greenhouse gas reduction. Likely measures include a combination of design for remanufacturing/recycling, minimisation of use through use of existing substitutes, product longevity strategies such as remanufacturing, voluntary closed loop recovery systems and recycling technologies. It is important that resource efficiency is not seen as simply recycling. Allied with this would be policy change measures at an EU level to move away from simple percentage recycling rate for ELVs and WEEE to one that takes greater account of strategic metals occurring in automotives and in electrical and electronic goods. However one proviso is that in fast growing areas such as rare earths for high strength magnets, the growth of the market and longevity of the products is such that even high levels of recycling of discarded materials will only provide a modest proportion of current supply.

2.6 As regards ethical supply, this is difficult when metal producing countries are increasingly separated from the consuming countries and often have poor environmental and social governance. We propose that an increased use of standards, ecolabels and sustainable public procurement will help to communicate the message that metals sold in the UK need to be “clean”. Thus a business case can be made to producer organisations as well as appealing to ethical and environmental motivations. We declare an interest as a contractor helping to deliver the EU Ecolabel within the UK.

3. How desirable, easy and cost­effective is it to recover and recycle metals from discarded products? How can this be encouraged? Where recycling currently takes place, what arrangements need to be in place to ensure it is done cost­effectively, safely and ethically?

3.1 Speciality metals typically have high embodied energy, and where manufactured in countries with carbon‐intensive energy systems, high embodied carbon. They also have large volumes of resources associated with their extraction and refining. Hence techniques to increase their resource efficient use are recommended.

3.2 Resource efficiency solutions should not be thought of solely in terms of recycling, although this is the first approach that tends to be suggested by metal‐orientated companies because of their familiarity with the secondary metals sector. Since many speciality metals are only used in small quantities and their applications can be dissipative, recycling is often very difficult, as evidenced by their often low recycling rates despite high prices. Hence alternative strategies such as extension of the product lifetime through remanufacturing, refurbishment or reuse may be a good strategy before materials recycling. When recycling must take place, strategies such as product take‐back, design for disassembly will be increasingly required to obtain these relatively small amounts of speciality metals.

3.3 Policy changes may be required to make recovery cost‐effective e.g. changes to the WEEE Directive and ELV Directive to target specific metals rather than an overall percentage mass recycling target.

3.4 Given the relatively low tonnages of many of these metals, recycling may only make economic sense with one or two plants within the whole of Europe. If exported outside of Europe, recycling may or may not be carried out in an environmentally and socially responsible way. If the materials are defined as hazardous waste, then controls should be possible under the Basel Convention.

3.5 Oakdene Hollins is currently undertaking a project funded by the European Pathway to Zero Waste Project that is assessing the potential for recovery and recycling of the fourteen metals identified by the EU Raw Materials Initiative as “critical”. This will include infrastructure and collection requirements (particularly in the SE of England), carbon impacts of recycling, the demand/supply balance and international best practice.

4. Are there substitutes for those metals that are in decline (sic) in technological products manufactured in the UK? How can these substitutes be more widely applied?

4.1 In the case of rare earth elements magnets (a major application for rare earths), some substitution is possible in some applications. However the rare earth magnets based on neodymium iron boron have been optimised over a period of around 25 years and no substitutes of equivalent performance exist. Generally, substitution across the strategic metals is often difficult, since they are often expensive and economic factors have encouraged their substitution with cheaper elements if possible. An extreme case is the Platinum Group metals, where there has been substantial effort to reduce its use in catalytic applications.

5. What opportunities are there to work internationally on the challenge of recovering, recycling and substituting strategically important metals?

5.1 A number of criticality studies have been or are currently being undertaken and are likely to identify a research agenda with a great deal of commonality between the US, Japan and Europe

5.2 Some work on substitution of critical metals is already being encouraged in the Framework 7 European research programme.

5.3 A number of networking events have been undertaken on this issue, for example the recent EU‐US workshop on rare earth elements and other critical materials for a clean energy future held at MIT on the 3rd December. The outputs from this meeting of researchers should be available shortly.

5.4 Given the likely minimum economic scale of recycling operations, the links to European legislation, and the visibility of the security issues at a European level, the best level of collaboration for the UK would appear to be at an EU level. 6. Background

Oakdene Hollins researches and consults on sustainable products and services. We also run the Centre for Remanufacturing and Reuse, the only European centre of its kind, which promotes those activities with products when they can be shown to environmentally beneficial. We are part of UK Ecolabel Delivery, which is concerned with the EU Ecolabel scheme.

We have carried out the following projects on the issues of strategic metals and materials security:

• In 2008 our report “Material Security: ensuring resource availability for the UK economy” was published by the Resource Efficiency Knowledge Transfer Network (now the Environmental Sustainability KTN). This concluded that there were not absolute scarcities of metals, but that the increasing environmental impact of mining, extraction and purification were likely to lead to limits in production before absolute scarcity became significant.

• In early 2010 we completed a study on the likely availability of the rare earth elements for the low carbon economy, including the possibilities of substitution and recycling, for the Department for Transport and for the Department for Business, Innovation and Skills. We concluded that there were likely to be short to medium term shortages of certain key rare earth elements for high strength magnets, particularly if China continued its reduction of export quotas. Since that time, the announcement of a greater than expected reduction in Chinese quotas, with consequent price increases, and the use of rare earths supply in geopolitical disputes with Japan, has been widely reported in the press.

• For the Institute for Energy, a Joint Research Centre of the European Commission we are currently researching critical metals in the materials supply chains of six of the energy generation sectors that form part of the European SET Plan for achieving low carbon energy generation targets. These sectors are nuclear, wind, photovoltaics, smart grid, carbon capture and storage (CCS), and biofuels. This report will be completed in early 2011.

This response is submitted by Nicholas Morley, Director of Sustainable Innovation, and does not represent company policy.

Nicholas Morley

14 December 2010 Written evidence submitted by The Institute of Materials, Minerals and Mining (IOM3) (SIM 03)

Strategically Important Metals

1.Overview. The Institute of Materials, Minerals and Mining (IOM3) is in broad agreement with the Terms of Reference defined, in the form of five questions, put forward by the Parliamentary S&T Committee.

Comments on each of the Terms of Reference / Questions are given below. It is suggested that, before the answers to the five questions can be delivered with sufficient confidence to define actions, additional information is likely to be needed and discussions need to be initiated with overseas supply chain partners. IOM3 is willing and able to assist with the gathering of the required information from its international network and to facilitate the discussions.

2.Terms of Reference. 2.1 Is there a global shortfall in the supply and availability of strategically important metals essentials to the production of advanced technology in the UK? Given the downturn in the global economy there is probably not an immediate shortfall. However, the concentration of production of certain materials, in particular rare earth metals, in China, means that many industries in the UK are extremely vulnerable. The recent incident where China cut off supplies to Japan in response to a maritime incident is an illustration of the potential problems.

2.2 How vulnerable is the UK to a potential decline or restriction of supply of strategically important metals? What should the Government be doing to safeguard against this and to ensure supplies are produced ethically? It is recommended that these two questions should be separated in the Terms of Reference.

2.2.1 Vulnerability - The UK is as vulnerable as other countries, eg Japan, the USA and those in the EU that have advanced technology industries which depend on supplies of materials which are supplied by a single country.

2.2.2 Safeguards – The UK could in collaboration with international partners encourage and co-fund the re-opening of mines that were recently closed because of low cost competition from China. The UK could also, in collaboration with partners in Europe, establish facilities for the ethical recycling of discarded products that contain extractable strategic metals. Both options require detailed studies to determine the viable options in terms of locations and investment.

2.3 How desirable, easy and cost effective is it to recover and recycle metals from discarded products? How can this be encouraged? Where recycling takes place, what arrangements need to be in place to ensure it is done cost- effectively, safely and ethically? For the mature metals sectors there is a well developed recycling infrastructure which, because of the intrinsic value of the metals, is economically ,highly viable. Metals recycling in the automotive, construction sectors are highly advanced ( levels > 90 % for some metals), domestic waste stream management strategies are also improving metals recycling from packaging. Electrical goods are now subject to the WEEE directives and are increasing being recycled. The challenges for increased metals recycling are based around consumer behaviour, separation technologies and also by the design for dismantling of techniques which are now increasingly common in product design.

The recycling industries’ business models are similar to any mainstream businesses, some operating with ISO9001 and or ISO 14001. All will be subject to the usual H&S, COSHH and Environmental regulations. Some will have fully developed CSR policies in line with increasing customer interest.

High technology industries rely on materials that are very precisely defined in terms of composition and processing. Recycled materials of unknown provenance are not attractive alternatives. A new industry could be created which recycles safely and ethically the valuable strategic materials contained in junked electronic products. More details studies are needed to define the cost effectiveness of closely controlled recycling including design for recycling.

2.4 Are there substitutes for those metals that are in decline in technological products manufactured in the UK? How can these substitutes be more widely applied?

Substitution is almost always difficult and expensive, not least because of the long term investment in the refinement and testing of the incumbent materials. Hence substitution costs are often less dependent on the relative raw material costs than on the demonstration of equivalent performance in the end product. In addition many products would need to re-designed to accommodate the substitute material

In many electronic the products the unique properties eg of neodymium magnets have enable the minaturisation of many end products and substitutes are not obvious.

2.5 What opportunities are there to work internationally on the challenge of recovering, recycling and substituting strategically important metals?

International collaboration is essential if any effective solution is to be found to the current threat. The Institute of Materials, Minerals, and Mining is uniquely placed through it UK and International Membership to facilitate discussions and is willing to do so.

3.Conclusion. In the long term, concerted action, such as plans to re-open mines and recycle materials more effectively, by countries threatened by supply problems of strategically important materials, is needed to secure a less vulnerable supply chain for the advanced technology industries in the UK and other countries.

Norman Waterman FIMMM Louis Brimacombe Chairman External Affairs Group Chairman Sustainability IOM3 Group IOM3

14 December 2010

Supplementary written evidence from The Institute of Materials, Minerals and Mining (SIM 03a)

In response to question 28, Dr Rickinson refers to the export of large volumes of copper scrap (800,000 tonnes in 2005) mentioned by Dr Pitts, am I right in thinking that Dr Rickinson believes that this is due to copper theft? I guess the process is that the copper is stolen and then sold to a scrap yard from where it is then exported. Are you able to comment on the following questions:-

? What proportion of the total scrapped copper in 2005 does the 800k tonnes represent? ? Roughly what proportion of scrapped copper is thought to come from theft? ? Why are there no facilities for recycling copper in the UK?

Within the responses to question 28 and the future of 800,000 tonnes of exported non ferrous metals suggested by Dr Pitts, I would expect that the largest volume of this would be aluminium. I have no direct knowledge of the proportions involved, but within a range of non ferrous materials, aluminium, copper, titanium, brass/bronze and nickel would probably feature. I will try to get you a more precise estimate of current exports and proportions from the British metal recycling association.

In response to question 31, Dr Rickinson states in regard to copper recycling that: “processes have been developed in which the UK could invest without necessarily going through a melting route”. Could you please elaborate on these a little?

Your second question relates to the absence of facilities for recycling copper in the UK. To be specific, the logistic network to collect and segregate copper scrap is in place within the UK, but the downstream investment to remove the polymer and other sheath materials from the copper and then to remelt and cast this is not in place. Commercial and environmental concerns are important here. Insulated cable can be granulated and the plastic coating removed from the copper to use both materials in a controlled recycling loop. By contrast, an easier solution is to burn the plastic coating off the copper cable directly in the melting furnace. This creates environmental issues which, within the UK, would be expensive to overcome. Where such environmental policies are reduced, the opportunity exists to recover the copper at the expense of losing the polymer material. I would suggest therefore that no melting facilities are available in the UK due to the high investment cost required to satisfy all legislation and to make a commercial return on this investment.

Regarding your comment on the matter of question 31, my reference here is to various processes that can be categorised as metal extrusion. Generating a supply of polymer free, and clean copper scraps, the copper granules can be cold extruded through a die. During extrusion, friction forces will rapidly increase the temperature of the copper causing diffusion bonding of the metal particles in the extruded shape. Providing the metal is clean, and following subsequent heat treatment, high purity, high conductivity copper can be formed which is suitable for further drawing to wire and cable and tube forms. The manufacture of drawn wire and cable from copper coil is still very active in the UK, so this extruded recycled material could be directly used in the UK. Currently, we understand the coil for wire drawing is imported from Poland, China and India.

Dr Bernie Rickinson The Institute of Materials, Minerals and Mining

15 February 2011 Written evidence submitted by University of Strathclyde and University of Oxford (SIM 04)

The Mineralogical Limitations of Low Carbon Energy: Research Towards a Truly Sustainable energy Future

Executive Summary Although the conclusions of the Club of Rome report “The Limits to Growth” have now been largely discredited, the introduction of new technologies to support renewable energy, such as fuel cells, batteries, PV etc will place strain on certain strategically important materials. One example is the provision of platinum group metals for fuel cells. We recommend the formation of a research cluster whose objectives will be to identify crucial gaps in materials supply and to propose new research directions, such as alternative materials or effective recycling that will make renewable energy truly sustainable. The UK is in a global competition for these resources and as things stand will not be able to proceed to a carbon free economy. These problems will not simply disappear and it is our recommendation that an academically based experts committee be formed to examine the reliance of clean energy technologies on strategically important minerals. It is fundamentally important to develop new research lines in this area.

Introduction The arguments promoting the use of clean, renewable sources of energy such as wind, marine, solar and bio- derived to replace fossil fuel sources are so well known that it is hardly necessary to discuss them here. The environmental, economic and security arguments have sparked a global effort to develop energy supply chains based on these sources. Although the debate over whether nuclear energy is a sustainable energy still rages, for our purposes it is regarded as a low-carbon technology that will have an important part to play in reducing carbon emissions over the medium and long-term. Consequently, it is given an equal weighting here. Given the fact that there is more than enough wind, marine, bio and solar energy to satisfy societal needs the question “Is renewable energy sustainable?” may seem paradoxical. However, as will be demonstrated here, current technological developments in renewable energy rely on mineral sources that are most definitely not sustainable: A complete reassessment needs to be made of the deployment of such technologies and indeed, the development of certain technologies may be completely abandoned. All of this is set against an increasing global requirement for energy in all of the OECD, BRIC-bloc (Brazil, Russia, India, China) and developing countries. Renewable energy sources have created new challenges but perhaps the hardest to deal with is their intermittent or unpredictable nature, or indeed, both. Perhaps the next greatest challenge is to provide energy for transport. The solution here is to develop efficient energy storage systems. For convenience, technologies of importance here are categorised as hydrogen or electron based. The hydrogen route consists of hydrogen production (such as electrolysis), storage and conversion (such as PEM fuel cells). The non-hydrogen route relies on devises such as batteries, supercapacitors, superconducting magnetic energy storage and flywheels. Alongside this is the need to develop efficient methods for energy collection, distribution and conversion. Examples of energy collection are wind turbines, photovoltaic devices. New technologies for energy transmission include superconducting cables. High temperature fuel cell designs such as solid oxide and molten carbonate based devices are being developed for the efficient conversion of bio-derived power. The above list is not exhaustive but represents some of the most heavily researched areas of renewable energy. Each of them relies to some a greater or lesser extent on increasingly scarce mineral resources. Their potential global deployment would therefore perturb current markets to a corresponding extent that needs to be analysed in considerable detail. Before this, it is important to set a reasonable global context for future energy requirements. According to Energy Information Authority figures, annual global energy utilisation is about 500 Quadrillion Btu. Although energy consumption has fallen in the EU, China showed an increase of energy consumption of 7.7% in 2007 and globally energy consumption is likely to rise at an annual rate of 2-3%. The time frame considered here is fifty years; by which time other energy technologies (such a nuclear fusion, which also creates mineralogical problems which are considered here) may well dominate.

Estimation of Minerals Reserves Much of the data used here is based on the United States Geological Survey (USGS) database1. The USGS make a clear distinction between the ideas of “Reserve” and Reserve Base”. They also list the annual production rate for most minerals. From these two values a Reserve to Production (R/P) ratio can be calculated with the unit of years.

R/P ratios are commonly used for fossil fuel reserves and give an estimation of the lifetime of reserves if used at a particular rate. The USGS definition of Reserve is relatively straightforward and is defined as “A concentration of naturally occurring solid, liquid or gaseous material in or on the Earth’s crust in such form and amount that economic extraction of a commodity is currently or potentially feasible”. Whilst massively useful in itself this paper deals with technologies that will create new demands on mineral resources, a situation which will certainly distort commodities markets and require new minerals deposits to be developed. Consequently, the USGS Reserve Base figures are of more use here. Understandably, the definition is a little less clearly defined but is best illustrated by the following key phrase “The reserve base includes those resources that are currently economic (reserves), marginally economic (marginal reserves) and some of those reserves that are subeconomic (subeconomic reserves)”. Therefore, if unprecedented demands were to be made on a particular mineral, this is a more conservative, and realistic figure. The USGS also give information about the current utilisation of different minerals, how much is recycled, possible alternative materials and a global distribution of resources. As an example consider Boron, the base of a possible hydrogen storage material, Lithium Borohydride. The 6 6 current global reserve (as B2O3) is estimated at 170 10 Tonnes whereas the Reserve Base is estimated at 410 10 Tonnes. The current rate of production of Boron (in all forms) is estimated at 4.3 106 Tonnes yr-1, although the figure for the USA is withheld for commercial reasons. The principal use of Boron is for glasses and ceramics (72%) for which there is no industrial substitute. A negligible amount of Boron is recycled. The above illustrates a number of features to be discussed. Firstly, the (static) R/P ratio based on Reserves is less than 40 yr but the R/P ratio based on the Reserve Base is almost 100 yr. The fact that a negligible amount of Boron is recycled leads to the concept of “minerals entropy” in which relatively concentrated forms of Boron are eventually distributed globally leading to an almost irrecoverable loss. Clearly, unless Boron is recycled then it should not be regarded as a long-term sustainable resource. The issue here however, goes well beyond these considerations and asks the question as to what would happen if Boron were to act on a large scale as a material for the storage of hydrogen. In fact, there is physically not enough boron in the world to satisfy the demand for large-scale hydrogen storage and it is questionable whether research in this subject is worthwhile from a commercial point of view. As will be seen, te situation is equally critical for a wide variety of raw materials. Although the famous report from the Club of Rome “The Limits to Growth” (1972) is largely discredited, we feel that the issues raised will become a reality within the next forty years, unless research is taken into developing alternative forms of renewable generation, storage and conversion starting immediately. The research cluster proposed here will commence and coordinate this activity within the UK and in close cooperation with the country in which these issues will be even more important, China.

The Need to Develop New Energy Technologies We have identified the technologies most at risk from the availability of strategic minerals and the following have agreed to participate in such a cluster: • Professor Peter Hall (Strathclyde) – energy storage • Professor Peter Edwards FRS (Oxford) – hydrogen • Professor Xiao Guo (UCL) –, Chinese links, hydrogen and biofuel cells • Professor George Smith FRS (Oxford) – nuclear fission and fusion materials • Professor Professor Stuart J C Irvine (Glyndŵr University, OpTIC Technium) - PV • Professor Peter Bruce FRS (St Andrews) – Li batteries • Professor Stephen Skinner (Imperial) – high temperature fuel cells • Professor Keith Scott (Newcastle) – low temperature fuel cells • Professor Nick Hanley (Stirling) – resource economics Each of the cluster members are well connected to the energy community in the UK and collectively the group has a track record of participation on governmental committees and supplying evidence to parliamentary committees. This is essential to our mission of influencing both future research directions and energy policy. The main activities of the subject will be small meetings; national and international study visits and UK workshops. There will be differences in the activities of the subject groups to enable specific information to be gathered and assessed, for example to determine information about specific minerals directly from mining companies etc. The subject groups will feed information into the cluster for biannual meetings. The main function of the cluster will be to produce two high profile reports. The first produced by the end of the fourth quarter will be a comprehensive overview on the supply problems of renewable energy to be published in a high impact journal such as Science. Additionally, the cluster will formulate and support joint research proposals to EPSRC and ESRC. The final high impact report will be a review of the progress made by the cluster in pointing the way to a truly sustainable energy future.

The main functions of the management team will be external communications, publicity, cluster meeting organisation and final report assembly. Since the work of the cluster is of long term consequence and will need monitoring beyond the scope of this call, the cluster have agreed to meet on a regular basis beyond three years and that this will be funded out of individual research contracts or by a further proposal to EPSRC, Royal Society etc of necessary.

Work Programme The work will be divided into two broad (overlapping) phases: problem identification and the development of radical, sustainable alternatives to current paradigms. In general terms, problem External communication identification will consist of establishing the relationship between current developing technologies and the availability of strategic materials in Management terms of the likely global requirement. This is by no means a trivial task, requiring forward thinking and interactions with other consortium Research Cluster Research proposals members, especially regarding the geochemical and economic aspects. One key objective of the first phase will be to write new research proposals to strengthen the applied geochemical and resource economic Subject groups aspects of the consortium. The second phase is equally challenging and will develop new research directions to ameliorate or avoid the materials Subject workshops etc supply problems i. Energy Storage (Peter Hall). Energy storage is also considered in the hydrogen and battery subject groups and this subject is mainly concerned with redox flow batteries and superconducting magnetic energy storage. These are two research groups that are under represented in the UK although superconducting technologies were mentioned in the recent MAT-UK report on transmission and distribution. Research needs to be conducted into the use and availability of a number of materials such as Yttrium, Strontium, Barium and Bismuth amongst others. As the class of high temperature superconductors increases annually, it is necessary to produce a summary report relating the scientific progress to metals availability. In the field of redox batteries large amounts of materials are needed to produce the large devices needed for storing grid energy. Therefore it is important to relate the different redox cycles e.g. vanadium, cerium and zinc based systems to materials availability and safety. ii. Links with China (Xiao Guo) China’s rapid and continued rise in economic and technological stances largely influences the global resource and climate issues. Close engagements with key scientists, funding bodies and policy makers in China are important to sustain a clean energy economy. While priorities may vary, close bilateral discussions and exchanges are beneficial to scientific and technological planning, resource management and long- term collaborations. In this aspect of the Cluster, we aim to foster UK-China interactions by the following strategies: 1) Organisation of bilateral forums on “Clean Energy and Resource Implications for Sustainable Low- Carbon Growth”, with early involvement and co-sponsorships from National Natural Science Foundation of China and Chinese Academies of Sciences and Social Sciences, linking to the newly formed National Energy Bureau / Commission; 2) Establishing links with a multidisciplinary group of influential Chinese scientists in social, economic and natural sciences by exchange visits and focussed discussions, e.g. via the internet; 3) Identifying the overall challenges for resources and low-carbon energy technologies and specific areas for joint research projects with co-funding opportunities from funding agencies, e.g. joint projects from the Ministry of Science and Technology and EU Framework Seven.; and 4) Creating a sustainable UK-China network in “ Sustainable low- carbon economy – tackling the Mineralogical Limitations and Challenges”, which may be extended to other international links, as the Cluster expands over time. iii. Nuclear (George Smith) The materials resource issues involved in nuclear power generation are highly complex, and there are many uncertainties involved in making forward projections. There are two main technologies to consider: nuclear fission and nuclear fusion. These involve rather different issues. Nuclear fission technology is relatively mature, and the main resource issue is the long-term availability of fuel materials. With the upsurge of global demand for new nuclear build, important questions arise about the future availability of adequate supplies of uranium minerals. In some countries (e.g. India), there is an upsurge of interest in alternative fuel cycles, for example based on thorium. Fuel reprocessing will become of increasing importance, and the use of fast reactors to “breed” additional fuel supplies will need to be re-visited. Elsewhere in the nuclear fission sector, there is increasing emphasis on safety, reliability and efficiency, extension of safe operating lifetimes, and reduction of the need for routine maintenance and inspection. New designs are emerging for high-temperature gas-cooled reactors, modular reactors, and hybrid electricity and hydrogen-generating reactor systems. It is too early to say whether these trends will put any real pressures on natural resources, but it will be necessary to keep the whole of this field under constant review. One example from current research will indicate the kind of issues that can arise. It is becoming clear that the stress corrosion cracking resistance of the stainless steels used in

reactor primary cooling systems can be markedly improved by additions of certain platinum group metals (PGMs). Whilst this may improve the reliability and durability of nuclear plant, such a technology change would put additional pressure upon an already stretched PGM resource sector. In the case of nuclear fusion, the materials challenges are far from clear, because the field is still at an early stage of development, and the final selection of preferred materials for commercial-scale fusion energy power systems will not have to be made for one or perhaps two decades. However, some key issues can already be identified. One concerns the lithium blanket, used to breed tritium for use in the reactor. It seems likely that large-scale use of lithium in that application could put some strain on global resources for this material. Also, if superconducting magnet technology is employed, the sheer scale of the magnet engineering required could put pressure on the supply chain for the very high quality niobium alloys (or equivalents) that will be required. Finally, and perhaps most importantly of all, there is a pressing need to develop new alloys that can withstand unprecedented levels of heat and neutron irradiation without suffering rapid degradation of mechanical properties, or becoming excessively radioactive (and thereby generating a new range of waste storage and / or disposal issues). A broad spectrum of materials is under consideration, ranging from oxide-dispersion strengthened steels (involving rare earth additions), to exotic metals such as vanadium. In a number of cases, large-scale deployment of such materials could lead to severe shorter- term pressure on global production capacity, and perhaps ultimately to significant impact upon global resources. iv. PV (Laurie Peter). Photovoltaic cells based on monocrystalline silicon will be replaced at least in part by cheaper thin film solar cells as the cost of PV power is driven downwards towards a level that can compete with power generation from fossil fuels. Several technologies are in the running – the most promising for the short term being based on cadmium telluride and copper indium diselenide as absorber materials. In the longer term concerns about the toxicity of cadmium and the rapidly increasing price of indium raise issues of sustainability. In an effort to address these concerns, Professor Peter’s group in Bath is working on low cost dye-sensitized solar cells as well as on new sustainable inorganic absorber materials for thin film solar cells. Dye-sensitized solar cells can be fabricated using low cost titanium dioxide and small amounts of sensitizer dyes. This technology is already being used by G24i in a newly established plant in Wales, and the Bath group is collaborating with other UK research centres and Corus Coatings to develop dye cells on metal substrates for deployment in roofing areas. Work on inorganic thin film solar cells continues as part of the recently renewed PV21 SUPERGEN programme. Sustainability is a central platform of the renewal programme, and inorganic materials identified in Bath as potential candidates to replace materials such as copper indium (gallium) diselenide include the very promising compound copper zinc tin sulfide (CZTS), in which the costly indium and gallium are replaced by equal amounts of zinc and tin. CZTS cells with world-leading efficiencies have already been fabricated in collaboration with colleagues at Northumbria. Other materials that will be explored include copper bismuth sulfide, which has promising properties. The search for new materials will be underpinned by a detailed computational exploration of emerging and new materials using the UK Teraflop supercomputer (HPCx) at Daresbury v. Batteries (Peter Bruce). There is expected to be a large and continuous increase in the demand for Li based batteries over the next twenty years for transport and grid applications. The dominant technology at present consists of a negative electrode formed from carbon (usually graphite), a positive electrode based on LiCoO2 and an organic electrolyte based LiPF6 dissolved in a mixture of alkylcarbonates as the electrolyte. Cobalt has been the dominant cathode material in rechargeable lithium batteries since their introduction. The mining of cobalt is economically viable in only a few locations worldwide and these are politically and economically unstable. In recent years the price of cobalt has increased almost tenfold with major implications for the lithium-ion battery industry. The limited availability of Co on the planet means that it is unviable to develop larger scale lithium batteries based on Co. Considering cost and abundance, Mn and Fe are the most attractive elements with which to form lithium transition oxides suitable as cathodes in future rechargeable lithium batteries. However even these metals have seen significant increases in cost and demand over recent years. For example, between 2006 and 2008 the demand for Fe ores increased by some 40% so even these materials, regarded presently as abundant and cheap, may not continue to be so in the new industrial landscape in which India and China are major players.1 Concerning the anode, already the performance limitations of graphite have resulted in the replacement of this material by metal alloys, such as the introduction recently by Sony of a metal alloy anode based on Sn and Co. In addition to the comments made about cobalt above, the supplies of Sn may be exhausted within 20 years. Again we see that even the new generation lithium battery technologies can only have a limited lifetime because of resource implications. Although there is no metallic lithium in a lithium-ion battery, lithium is a major component. There are widely different predictions concerning the planetary resources of lithium (lithium carbonate). A Recent report by R. K. Evans2 suggests that there are abundant lithium resources corresponding to 28.5 million tonnes of lithium, equivalent to sufficient lithium carbonate for 1775 years of supply. In contrast, another report from Meridian International Research3 estimate around 4 million tonnes of which around 2 million tonnes of chemical grade lithium carbonate are likely to be available by 2015. These vastly different predictions demonstrate that it is crucial to undertake a rigorous examination of the resource implications for future lithium- ion technology. Such considerations drive towards the development of new lithium-ion battery materials from waste biomass or crops. This could have radical implications for the direction of research in the field, signalling a

move away from inorganic materials to organic based cathodes and anodes. Given the critical nature of this technology in addressing global warming it is vital that a group of scientists, engineers and geoscientists, knowledgeable on lithium batteries, their materials requirements and mineral resources, examine the significance of raw materials and tension them against the drivers of cost and performance. vi. High temperature fuel cells (Stephen Skinner) Solid oxide fuel cells (SOFCs) are a technology area that has been in development for many years and has now reached a point of maturity where viable large-scale commercialisation is imminent. Indeed in the UK, for example, utilities such as Centrica have entered partnerships with fuel cell developers to deploy 30,000 units over the next 5 years and in the US, it is anticipated that annual spending on fuel cells will reach $975 million by 2012, growing by 600% from current values. The high temperature SOFCs are based on the development of ceramic oxides (functional oxides) that overcome some of the concerns with low temperature fuel cells that rely on high Pt contents. However bulk oxide development and deployment of SOFCs raises concerns over the availability, and security of supply, of many of the materials currently considered as state-of-the-art. These include rare earth stabilised zirconia, and Gd-doped CeO2 amongst others. To address these concerns the group at Imperial College is investigating a number of approaches: development of new oxide and related materials with greater ionic conduction, implementation of nano-fabrication to reduce materials requirements and enhance properties, investigation of complementary technologies (e.g. proton conductors). Much of this work is performed in conjunction with the SUPERGEN fuel cell consortium, and is focussed on the durability of fuel cell components. These programmes are concerned with the long term viability of materials solutions and involve the interaction with materials simulation experts to identify potential new components. We are also actively involved in developing epitaxial thin film technology and deposited heterostructures with groups in Europe and the US. Further complementing our activities are linkages with groups in Beijing focusing on new technologies including BaCoO3 cathodes and SrTiO3 anodes. vii. Hydrogen storage (Peter Edwards). Hydrogen storage is one of the most complex subjects in the area of renewable energy. A wide variety of systems have been evaluated for potential development and it is still not clear which system will come to dominate. As has been noted earlier, the sever limitation in supply of certain materials such as boron may exclude their future development and indeed an analysis of the availability of strategic materials will help clarify research directions in this area. The most promising systems are based around light metals such as Li and Mg but to be effective they need to be doped with a catalyst to reduce hydriding temperature or to improve kinetics. This can be either a transition metal or a Pt group metal. Therefore, one obvious research direction would be to relate the loading of these additional metals to their availability and to estimate their impact on global production rates and recycling. viii. Low temperature fuel cells (Keith Scott). Fuel cells and electrolysers for hydrogen production are prime examples of technologies where resource availability will have a major impact. Notably combating the resource limitation of Pt. Achieved by researching alternative materials with alternative cell technology or operating conditions. The issues for both technologies are similar and can be tackled using similar strategies. For Hydrogen PEMFC technology there is interest in the application of alternative electrocatalysts to Pt such as Raney nickel (Ag may be suitable) and inter-cell connectors based on stainless steel, such as Ni. High temperature PEMFCs can increase conductivity and improve electrode kinetics, which can provide the opportunity for alternative electrocatalysts. Alternatives are based on palladium; but again resource limitation may exist. Research is also taking place to further reduce the PT content and alternatives based on non-precious metals such as W may be possible. For the cathodes, there is large interest in Pd and Au based catalysts but alternative non-precious metal catalysts should be investigated. In the field of electrolysers hydrogen production by water electrolysis is based on one of two technologies; alkaline electrolytes and solid polymer electrolytes (SPE). Currently the dominant (lower cost) route to hydrogen is alkaline electrolysis. The use of a solid polymer electrolyte (SPE) in water electrolysis enables hydrogen production from pure (demineralised) water and electricity. Proton exchange membrane (PEM) water electrolysis systems offer advantages over traditional technologies; greater energy efficiency, higher production rates (per unit electrode area), and more compact design. Like proton exchange membrane (PEM) fuel cells; catalysts used are based on precious metals: Pt for the cathode and a mixture of Ru; Ir; Ti (with possibly Sn; Pt) oxides for the anode. The anode catalyst cannot be supported on carbon as it oxidises at the potential for oxygen generation. Thus catalysts are unsupported typically deposited onto the membrane. Anode electrocatalyst connectors need to based on an inert metal such as Ti or Ta. Alkaline (hydroxide conducting) membrane electrolysers; combine the advantages of the PEM electrolyser and the alkaline electrolyte electrolyser. The application of alternative electrocatalysts to Pt such as raney nickel (is Ag sustainable). High temperature PEM electrolysers can increase conductivity and improve electrode kinetics which can provide the opportunity for alternative electrocatalysts. ix. Resource economics (Nick Hanley). Mineralogical limits to renewable energy technologies pose interesting questions for economists in terms of market failure and institution design, and are an example of a supply-side constraint on a development path. Currently, knowledge is very limited on the extent to which market forces will smooth the transition towards a low-carbon economy, in the presence of government interventions such as tradeable carbon credits and green certificates for renewable electricity. Possible causes of market failure with

respect to supply-side constraints include (i) public good aspects of R&D into alternative sources of inputs and alternative technologies (ii) information asymmetries (iii) externalities connected with the supply chain and (iv) private sector discount rates being higher than the social rate of discount. In addition, the distributional impacts of supply-side issues may lead the government to intervene in market adjustments on non-efficiency grounds. Three main activities are envisaged. The first is the organisation of an international workshop on the economics of renewable energy, focussing on supply-side factors and innovative policy solutions to problems identified. This will bring together economists from across Europe and the US with an interest in renewable energy, and will result in publication of a workshop proceedings. We will also seek to publish this collection as an edited book, for example the the Routledge series on “Explorations in Environmental Economics”, for which NDH is the series editor. A smaller group of economists will then take the most promising ideas contained within the workshop proceedings, and work them up into a series of policy proposals, which can be analysed in a second workshop which will draw on non-economist members of the cluster and its stakeholder community. This will lead to the publication of a second report containing a finalised set of policy proposals from the cluster on the issue of instrument design and supply-side constraints to renewable energy development. This report will then be launched at a stakeholder conference to be held towards the end of the cluster’s award period.

References 1 United States Geological Survey, Mineral Commodity Summaries Report (2008) 2 R. K Evans, An Abundance of Lithium (2008) 3 The Trouble with Lithium 2, Meridian International Research, Les Legers, France (2008).

Submitted by Professor Peter J. Hall Department of Chemical and Process Engineering University of Strathclyde, Glasgow And Professor Peter P. Edwards Department of Chemistry, University of Oxford, Oxford

16 December 2010

Written evidence submitted by Aerospace and Defence Knowledge Transfer Network, Materials and Structures National Technical Committee (NTC) (SIM 05)

Strategic Metals Key to the UK Aerospace and Defence Industry

Inquiry on Strategically Important Metals

Disclaimer The Materials and Structures National Technical Committee (NTC) membership is drawn from industry, academics, government agencies and independent experts with activities or an interest in the UK Aerospace and Defence Industries. The views and judgments expressed in this review reflect the consensus reached by the NTC and do not necessarily reflect the views of the organizations to which its membership is affiliated. While every care has been taken in compiling this report the Materials and Structures NTC and its members cannot be held responsible for any errors, omissions or subsequent use of this information.

1. Introduction This report aims to review the factors which are likely to impact on the provision and sustainability of the main strategic metal elements within the UK aerospace and defence supply chain, and to consider these within the context of the business environment risks, strategic risks, financial and operational risks faced by UK industry. This is a high level strategic consideration of the issues rather than a detailed analysis at product level.

2. Strategic Metals for The Aerospace and Defence Industries. The global economic recession of the last two years has impacted the production, selling price and market forecasts for all metal commodities. Whilst generally consistent, there are differences in the extent to which individual markets have been affected, and the time scales over which they are projected to recover. It is thus worth noting these effects separately for each metal.

Metals perceived to be of the highest concern for the aerospace and defence sector are Cobalt, Hafnium, Platinum and Rhenium.

2.1 Chromium South Africa and Kazakhstan account for about 62% of global chromite production, which is equivalent to approximately 70% of global ferrochrome production. Chromium- containing products include ferrochromium, chromium chemicals, and metallic chromium. Ferrochrome dominates the market. The major chromium-metal producing countries in the world are France, Russia, China, and the United Kingdom for aluminothermic chromium metal and the United States and Russia for electrolytic chromium metal. The aluminothermic process dominates global production, about 95%.

Security of Supply There are no substitutes for chromium metal in stainless steel and super-alloy production. With the restriction environmental restrictions on hexavalent chromium alternatives to chromium plating for surface protection are beginning to become available. Given South Africa’s dominance in chromite production, any disruption there can impact significantly on global availability and price. In 2007-2008, electricity disruptions also impacted on global ferrochrome and metallic chromium. This supply constraint pushed prices up more than 100% over their average value in the preceding 12 months. Kazakhstan, like South Africa, is ranked “borderline” on the Failed States index, and in the poorest 15% of countries performing according to the Policy Potential index. Both scores suggest a moderate-to-high degree of risk associated with on-going production from both countries, however, global reserves suggest there is enough economically recoverable chromite for many years to come.

2.2 Cobalt Cobalt is a common alloying addition in steels, magnetic, wear resistant and high strength alloy systems e.g. superalloys. The Democratic Republic of Congo dominates global production, followed by Canada, Zambia, Australia and Russia. China is the world’s leading producer of refined cobalt, and much of its production is from cobalt-rich ore and partially refined cobalt imported from the Democratic Republic of Congo (this reflects Chinese investment in African minerals more generally).

Security of Supply Cobalt is mostly produced as a co-product of other base metals, notably copper and nickel. Cobalt demand has focused attention on the reprocessing of copper tailings to recover cobalt. Waste processing costs are a variable, but this has not stopped considerable international joint-ventures in this area, to help stabilize global supply. The lower production figures in other countries, such as Australia, reflect the lower grade of cobalt in run-of-mine ores. The ability to ramp up cobalt production in countries other than the Democratic Republic of Congo is dependent on market demand for the primary coproducts. The Democratic Republic of Congo “Failed State” index position is a worry (it is the 5th most critical country), and there has been evidence of political interference, corruption, smuggling and other criminal activity associated with cobalt concentrate production in that country. Several internationally funded projects have been cancelled as part of a government review. Cobalt and its compounds are used in a wide variety of applications, including several emerging ones driven by technology innovation. The

diversity and growth of other applications could put additional pressure on the metal’s use.

2.3 Hafnium World primary production figures for hafnium are not available. It is produced as a coproduct of zirconium from the titanium rich mineral sands industry. The hafnium to zirconium ratio is about 1:50, and physical separation is difficult. However, it is possible to get an indicative picture of hafnium production from the US Geological Surveys for zirconium, coupled to an indication of hafnium reserves. This results in an estimated global production to be of the order of 100 metric tonnes. Australia and South Africa dominate production. Both industries are well-developed, with the necessary infrastructures in place..

Security of Supply The nuclear industry dominates hafnium usage (56%)with the aerospace industry using a further 33%. With the anticipated growth in nuclear technology for power generation, there will be an increased demand for hafnium. Also, the semi-conductor industry is looking to hafnium as a (partial) substitute for silicon. This new demand, coupled to that for capacitors, will place additional pressure on supply. Given that hafnium is a minor co- product in the mineral sands industry, additional supply capacity will be slow to materialize, due to industry inertia.

Using the 1:50 metric, there is no shortage of hafnium reserves into the medium term.

2.4 Lithium Chile is the leading lithium producer, followed by Argentina. Both countries recover the lithium from brine pools. In the United States lithium is recovered from brine pools in Nevada. Nearly half the world's known reserves are located in Bolivia. In 2009 Bolivia began negotiating with Japanese, French, and Korean firms to begin extraction. China may emerge as a significant producer of brine-source lithium carbonate around 2010. There is potential production of up to 55,000 tonnes per year if projects in Qinghai province and Tibet proceed. In the aeerospace industry the major uses of lithium are as an alloying addition for lightwieght aluminium strauctural alloys and in Li-ion batteries.

Security of Supply There is currently no shortage of lithium and it is thought that world supply can comfortably meet demand. However this will change isf significant numbers of electric and hybrid cars start to be manufactured. The total amount of potentially available lithium worldwide has been estimated at 15 million tonnes, of which 6.8 million tonnes is currently economically recoverable.Using the figures of 6.8 million tonnes of Lithium and 400g of Lithium per kWh this gives a total maximum lithium battery capacity of 17 billion kWh which is enough for approximately 320 million electric cars with a 53kWh battery. This typeof demand may lead to sugnificant shortage of supply for structural metallic application s and for batteries in other industries.

2.5 Nickel The biggest reserve of nickel are in Australia, which has a well-developed mining infrastructure, and minerals investments are relatively low-risk; however, production in Canada, Indonesia and Russia now exceeded that in Australia. Other significant reserves include South Africa and Cuba. There was minimal fall-off in production in 2008 over the previous year which suggests that the demand for nickel has bottomed-out, and demand will likely increase as the global economy recovers. Roskill Metals and Minerals Reports, based on projections for stainless steel growth, predict a 3-5% increase in demand for nickel beyond 2010.

The global market is dominated by 6 countries; The USA, China, Japan, Germany, Taiwan and South Korea. Of these, only China mines some of its primary ore. Close to 70% of the global flow goes to stainless steel manufacture, and 60% of discarded nickel is recycled within the nickel and stainless steel industries. The total dissipative loss is 14% of the discarded amount. This global picture suggests that nickel management over its life cycle is reasonably good (certainly compared to other metal commodities such as aluminium and copper).

Security of Supply Whilst there is some potential to reduce nickel content of certain austenitic stainless steel applications in construction, it is unclear whether similar reductions could be achieved in more specialist areas, e.g. superalloys, without invoking supply constraints for other specialty metals such as titanium or chromium. According to the Failed States Index Australia belongs to the subset of “most stable” countries. Canada is described as “stable”. Russia, Indonesia and Cuba are all described as “in danger”, and South Africa is “borderline”. This picture does not change when the policy potential index is invoked. Here, Indonesia, Russia and South Africa are all in the bottom quartile. Cuba is not ranked. The situation is compounded by other performance measures. South Africa provides a good example of some of these. Firstly, its nickel deposits are associated with the largest global reserves of platinum group metals, and it is the refining of the latter which drives the production of nickel, copper and cobalt. Secondly, the country’s electricity supply network is at breaking point, and significant power outages have affected its mining operations in the last 2 years. This is exacerbated by conflicting policies and contradictory infrastructure resource plans. All of these factors contribute to the significant uncertainty which clouds minerals’ investments in this country, and could impact negatively on its metal output – not just for nickel and platinum.

Overall the supply of nickel seems secure.

2.6 Platinum Global supply of platinum is dominated by South Africa’s. The primary ore is a nickel, copper, cobalt deposit, with a platinum group metal concentration of less than 5 ppm platinum and palladium. Major uses are in coatings for corrosion protection, catalysis, electrical contacts, electrodes and thermocouples.

Security of Supply South Africa’s problems with infrastructure provision (electricity and water), its relatively poor track record on mine safety, and political interference in mining operations, have, in the past, all contributed to price instabilities and supply problems. These pose the greatest threat to security of supply.

2.7 Rare Earths Global supply of rare earths is dominated by China with over 98.9% of world production (>124,000 tonnes as oxide per annum). Significant deposits exist in Russia and the United States but at the moment these are not being worked. Smaller amounts are produced by India, South Africa and Malaysia. Rare earths are essential alloying additions to a variety of products from metallurgical additions to bulk alloys (e.g. cerium to Mg alloys and steels, samarium and neodymium in magnets and scandium to aluminium alloys) to phosphors and as addition s to glasses and ceramics The major uses of rare earths in the defence and aerospace sector are in computer hard disc drives, batteries, superconductors, lasers, sensors, inertia guidance systems etc. Some of the more exotic aero-engine blade alloys also contain small amounts of rare earth additions.

Security of Supply The rare earth market is complicated because of the large number of elements and their broad range of applications for which demand fluctuates over time, largely as a result of technological developments. The market has a history of abrupt change, e.g. in the 1960 samarium was the dominant rare earth due to the demand for samarium-cobalt magnets, by the 1980s this position had changed and a major demand was for neodymium in magnets has developed alongside the demand for samarium.

Rare earth elements are not openly traded commodities and there are low levels of transparency and a general lack of market information. However, prices are very volatile and spikes in excess of 300% have been observed.

Historically the balance of supply and demand has been fairly stable. However in the last 3 years the market has changed from a position of oversupply to one of demand shortages Also significant growth is forecast in most sectors of rare earth consumption, particularly for metals and magnets which have predict growth rates of 10 – 15 and 15 – 20 percent respectively.

Although China’s rare earth production has been increasing in recent years it has been reducing export quotas due to increasing domestic demand. China has also increased tariffs on the rare earths and their oxides. Closure of operations due to environmental concerns has further reduced supply. There is thus growing concern about the security of supply from China.

Spurred by increased demand and concern over China's effective control of the rare earth market, searches for alternative sources in Australia, Brazil, Canada, South Africa and the United States are ongoing. Mines in these countries were closed when China undercut world prices in the 1990s, and it will take a few years to restart production. One example

is the Mountain Pass mine in California, which is projected to reopen in 2011. Other significant sites under development outside of China include the Nolans Project in Central Australia, the remote Hoidas Lake project in northern Canada, and the Mount Weld project in Australia. The Hoidas Lake project has the potential to supply about 10% of the $1 billion of REE consumption that occurs in North America every year

Currently it is thought that of the rare earths of interest here only the neodymium supply may not meet demand.

2.8 Rhenium Rhenium is associated with the production of molybdenum, and principally from copper porphyry deposits. Its production is dominated by countries with significant copper mining and processing activity. Chile dominates primary production, with close to 50%, in 2008, followed by Kazakhstan and the USA. Close to 80% of production is consumed in super alloy manufacture for use predominantly in gas turbines. Its use in catalysts is a growing market.

Security of Supply Price volatility is the hallmark of the rhenium market. Based on a 10 year market average price (1997-2007), this range is close to 30-fold. The peak in 2008 was a symptom of continued demand for super-alloys, as well as problems being faced by one of the world’s largest producers of refined metal. This volatility has challenged the aerospace industry to review its dependence on rhenium. The main issue with security of supply is the fact that the availability of rhenium concentrate is dependent on copper and molybdenum refining. The price of these primary metals dictates the dynamics of rhenium production.

2.9 Ruthenium Global production figures for ruthenium are not available. However, production / reserve figures can be estimated based on those of platinum as ruthenium is present in platimun group metal ores at less than 1 ppm. Annual production is estimated at 30 metric tons. South Africa dominates the global supply and all insights from the platinum analysis and apply equally to ruthenium. Dominant uses are in electrical applications and hard-drives. Use in superalloys has been contemplated but the economics are prohibitive. The demand in such an application would rapidly exceed supply, leading to extreme price sensitivity to any perceived application.

2.10 Tantalum Global supply of tantalum is dominated by Australia, followed by Brazil. Major uses are as an alloying addition to steels and superalloys and for capacitors.

Security of Supply Events over the last 12 months have precipitated a crisis in the tantalum supply industry, despite reduced demand. The world’s largest supplier in Australia, which is singly responsible for more than 30% of global supply (Australia delivers about 70% of global production), has suspended its mining operations due to an expected continued decline in demand. This, coupled to a run down of global inventories, and growing calls to embargo

purchases from central and east Africa, means that the tantalum industry faces considerable uncertainty until at least 2012.

2.11 Titanium The world production of titanium metal is based in the US, Russia, Japan, China, UK, France, Kazakhstan, Ukraine, and Germany and overall world production is predicted to exceed demand for the foreseeable future. The major application is in metallic structural systems for land, sea and air applications.

Security of Supply Although supply is predicted to exceed demand globally there is an increasing demand on the high quality aerospace grades that UK aerospace and defence industry relies on. The UK titanium industry is focused on these grades, but there is growing dependence on Russia to supply these materials, based on their large cold war manufacturing facilities. To date this has not caused any problems, but with the political and economic uncertainty this position may change quite suddenly. China is also expanding its capabilities and is investing heavily in production and research and development facilities, mainly for domestic use but with an increasing world-wide presence.

2.12 Vanadium Vanadium is mined mostly in China South Africa and , Russia. In 2007 these three countries mined more than 95 % of the 58,600 tonnes of produced vanadium, with China dominating productiion. Approximately 85% of vanadium produced is used as ferrovanadium or as a alloying addition in steels and titanium alloys.

Security of Supply World production of vanadium grew by more than 7%pa from 2003 to 2008. Initially, production increases were met by taking up spare capacity at existing operations but from 2006, capacity had to be increased to meet demand. Most of this expansion, however, was also at existing mines and plants, most notably in China. In the next few years additional supply could come from re-opening the mine and plant at Windimurra, a new mine and plant in Brazil, further expansion of slag output in Sichuan as well as an increase in by-product output from uranium processing in the USA and South Africa.

Overall the supply of vanadium seems secure

3. Substitution All the elements discussed above cannot easily be substituted in the aerospace and defence industries. The unique properties they engender in materials cannot be replicated by either using less of them or by replacing them with other elements. It is thus essential to UK industry that we have a long term, stable source of these materials. An example would be Rhenium and Ruthenium as alloying additions in the highest performing single crystal turbine blade alloys for gas turbines. In this application despite conferring unique property advantages, because of the economic constraints use has not been made of Ruthenium additions and lower Rhenium content alloys are being developed.

4. Recycling It is difficult to discuss recycling for a diverse group of metals like this as their use, and hence recycling challenge, differs depending upon the metal. They can however be grouped into two main types:

(1) Bulk materials – e.g. steels, titanium alloys, nickel alloys, magnets etc. In these cases the materials are widely used and in a bulk form. Recycling is thus relatively straightforward as removal, collection and recycling are organised on a large scale and the industry actively supports these activities today. (2) Minor /trace additions, e.g. low alloying additions and trace amounts. These are more difficult to deal with as the strategic metals are widely dispersed, both physically and chemically, used in small amounts and are difficult to identify. In these cases it is often uneconomic to attempt recovery and they are lost to the production chain. Only where an element has an unusually high value or is particularly scare is this attempted and even then this is often restricted to within a company. It is in this area that most work is now going with attempts to identify viable recycling methods and routes. This is being done on a global scale by the industry as this is a common global problem to all users. A recently developed source of rare earths is discarded electronics and other wastes that have significant rare earth components. New advances in recycling technology have made extraction of rare earths from these materials more feasible, and recycling plants are currently operating in Japan, where there is an estimated 300,000 tons of rare earths stored in unused electronics.

5. Mitigating Actions The uses of the majority of these elements are specific to particularly industries and hence the responsibility for taking mitigating actions lies with the major players in these sectors. In many cases these actions are underway.

Aerospace and Defence Knowledge Transfer Network, Materials and Structures National Technical Committee (NTC)

16 December 2010

Written evidence submitted by Wolf Minerals Ltd (SIM 06)

INQUIRY ON STRATEGICALLY IMPORTANT METALS

1 INTRODUCTION

1.0 This submission to the Select Committee is made by Wolf Minerals Ltd. Wolf Minerals is based in Perth, Western Australia and listed on the Australian stock exchange. The principle business of the Company is the development of deposits of tungsten. The Company has assets in Australia, but the principle asset is the Hemerdon tungsten deposit in Devon UK. This submission deals specifically with tungsten but sets that within a broad framework of where the UK government may need to take action on all strategic or critical metal minerals.

1.2 The EU Commission has identified (June 2010) tungsten as being one of the 14 most critical mineral raw materials essential to the European economy but which are under threat of restricted availability.

The Hemerdon Deposit 1.3 The Hemerdon deposit has been described (British Geological Survey, in press) as “one of the largest tungsten resources in the western world”, with a total ore tonneage of 218.53 million tonnes containing 318,800 tonnes of tungsten. The deposit is currently being taken forward with the prospect of the first production of concentrate in 2013. The operation will involve the development of the first modern open pit metal mine in the UK, provide 200 skilled jobs and revenue of $100 million per annum. The open pit will extend to an oval shape, circa 850 metres by 540 metres and to a depth of 200 metres. Primary plant on site will produce concentrate for onward shipping to a processing plant in Europe. There is currently no tungsten processing plant in the UK. Around 4,500 tones of concentrate, equivalent to approximately 2,900 tonnes of tungsten metal, will be produced each year, sufficient to contribute significantly to meeting UK demand.

1.4 The Hemerdon deposit has a valid commenced planning permission which is currently being upgraded by Devon County Council through a Modification Order, with the full support of Wolf Minerals. As part of that process Wolf Minerals has offered a Unilateral Undertaking to provide further amenity and environmental works. Other regulatory permits are being pursued.

1.5 The Hemerdon deposit lies between Dartmoor and Plymouth and outside any major environmental protection areas. The development of this mine confirms the high prospectivity of parts of the UK for metals and the ability of the external amenity and environmental impacts to be managed in a manner which prevents nuisance or harm. There has been a perception that metal mining is neither economically viable nor environmentally acceptable in our crowded and protected country. The actuality, as evidenced by Hemerdon, is that the metal mineral resources in the UK can be utilised for our economic benefit, without harm to amenity or the environment.

1.6 There is also a perception that metal mineral resources in the UK are fully known and that there is therefore very limited opportunity to provide metal from within the UK. This perception, alongside that of ‘peak metal’ (the concept that global reserves are fully known and will run out in a few decades), is not correct. In most of the prospective areas within the UK the mineral potential is unknown at economic depths and there are indications of substantial targets.

1.7 Given that the planning and regulatory systems in the UK are both rigorous but fair, developing our own resources not only provides income, employment and security of supply for industry but also complies with sustainability, makes economic sense, and reduces the pressure on weaker regulatory regimes, environments and societies elsewhere in the world. Developing our own resources both enables the UK to minimise the off- shoring of environmental and health costs to other nations, but also ensures that the UK can negotiate trade agreements from a strong position.

1.8 Wolf Minerals is not a tungsten processor. The processing of tungsten is a specialist and cost intensive operation. However, the scale of annual production from Hemerdon might provide an incentive for a processor to build a new plant in the UK taking production from Hemerdon, supplemented by small arisings from other deposits which could then become viable, and scrap for recycling from the UK and Western Europe. Such a plant would need to meet the rigorous UK regulatory requirements and would therefore ensure that recycling is done in a cost effective, safe and ethical manner.

2.0 TUNGSTEN

Tungsten 2.1 Tungsten constitutes only 0.00013% of the Earth's crust. Economic minerals containing tungsten are primarily Wolframite and Scheelite. Tungsten has the highest melting point (3422°C) of all elements except carbon but also has excellent high temperature mechanical properties and the lowest expansion coefficient of all metals. With its density of 19.25 g/cm3, tungsten is also among the heaviest metals. Tungsten has the lowest vapour pressure of all metals, very high moduli of compression and elasticity, very high thermal creep resistance and high thermal and electrical conductivity.

Reserves 2.2 The United States Geological Survey estimates global tungsten reserves (proven, workable deposits and excluding Hemerdon) at 2.8Mt. China accounts for over 60% of world reserves. Other countries with reserves of tungsten, typically a tenth of the reserves of China, include Canada, the CIS and the USA. CIS reserves are probably considerably overstated. Other limited reserves are located in Asia, with smaller deposits in Europe, Latin America and Australia.

Production, Demand and Shortfall 2.3 Primary global tungsten production increased steadily from 35,650t in 1998 to an estimated 66,000t in 2010, of which China produced over 80%. Demand for tungsten tends to correlate closely with economic output, as tungsten demand in one year reflects growth in GDP from the previous year. Primary extracted tungsten meets about 66% of total demand. The remaining 34% is supplied through recycling (see Figure 1 below).

Figure 1 : Supply of tungsten

Scheelite Wolframite concentrate concentrate ↓ ↓ Primary tungsten (concentrates) Secondary tungsten ← 66% (scrap) 34% ↓ ↓

Total tungsten demand ↓ ↓ ↑ → Scrap during Final product 90% processing 10% ↓ Loss through → dissipation and discard Scrap from used parts 66% 24%

Source: ITIA

2.4 Given the historical relationship between tungsten demand and GDP, future tungsten consumption will closely follow GDP growth at both the global and regional levels. For the period 2010 to 2015, demand at the world level is estimated (Roskill) to grow annually by 6-7%, with global demand reaching almost 90,000t by 2015. However, existing production capacity and production capacity from all current new projects is likely to fall short of that demand, creating a growing shortfall.

Uses 2.5 Tungsten’s very high density and its high temperature properties are what make it unique and allow it to be used in a wide variety of applications. There are six main end- uses for tungsten, which in order of volume of use are: • Cemented carbides (hardmetals) • Alloy steels • Fabricated products • Superalloys • Heavy alloys • Chemicals.

Cemented Carbides 2.6 Cemented carbides, or hardmetals, are very hard, refractory, wear resistant materials that consist of metal carbides held in a bonding matrix. Cemented carbides are the main end-use application for tungsten.

2.7 Tungsten carbide exhibits extreme hardness and high resistance to abrasion up to very high temperatures. It is produced for widespread applications in ‘high-tech’ tools, wear parts and, significant to the considerations of the Committee, mining tools, as well as for many sectors of the engineering industry. Tungsten in cemented carbides mining tools is therefore essential in ensuring access to all other critical or strategic metals.

Alloy Steels 2.8 Steel is an important end-use for tungsten, representing around 20-25% of global consumption, although there are large variations in demand between countries. Tungsten contributes to the increased hardness, wear resistance and higher toughness. Alloy steels comprise three distinct markets for tungsten; tool steels, stainless and heat-resisting steels, and alloy steels.

Fabricated Products 2.9 Significant amounts of tungsten are used in the manufacture of tungsten metal products such as lighting filaments and electrical and electronic contacts. Demand for tungsten has been affected by the phasing out of the traditional light bulb. However, tungsten is also used as filament in halogen lamps, and in electrodes for discharge lamp systems and arc lamps. As a result, substitution of traditional light bulbs has had less of an effect on tungsten consumption.

2.10 Tungsten is also used in electrical and electronic contacts because it is able to withstand arcing caused when circuits are made and broken, and it is resistant to wear and corrosion.

Superalloys 2.11 Superalloys are nickel, cobalt or iron based alloys with high contents of tungsten, molybdenum, tantalum and rhenium. Their important properties include, high- temperature strength, high creep strength at high temperature, high thermal fatigue resistance, good oxidation resistance, excellent hot corrosion resistance, air melting capability, air or argon remelting capability, good welding properties and ease of casting.

2.12 Superalloys are used in aircraft engines, marine vehicles, and stationary power units as turbine blades and vanes, exhaust gas assemblies and burner liners.

Heavy Alloys 2.13 Tungsten heavy alloys are a group of two-phase composites with the properties of high density, high strength and ductility. Applications include counterweights in aircraft, rotating inertia members, x-ray and radiation shielding.

2.14 Other alloys include those alloyed with cobalt, molybdenum and rhenium; and refractory alloys, where tungsten forms solid solution alloys with a number of other high melting point elements, notably niobium and tantalum.

Chemicals 2.15 The main tungsten chemical end uses are as a catalyst and in other uses such as the manufacture of semiconductor devices, in pigments, as a corrosion inhibitor, in phosphors (lasers, fluorescent tubes, oscilloscopes, colour television tubes), in absorbent gels, as oil additives, for fireproofing, as a fluxing agent and for hard surfacing.

2.16 Tungsten has a number of roles at a catalyst including: • DeNOx catalysts for the removal of nitrogen oxides from combustion power plant stack gases. • Catalysts for hydrocracking, hydrodesulphuration and hydrodenitrification of mineral oil products, maximizing recovery of light fuels from heavy crude and making the products more environmentally friendly. • Other catalysts for dehydrogenation, isomerisation, polymerization, reforming, hydration and dehydration, hydroxylation, epoxidation, etc.

Tungsten Substitution 2.17 Due to its unique properties, there is relatively little opportunity, or incentive, to substitute tungsten in its major applications. Tungsten is relatively price inelastic (i.e. demand for tungsten does not automatically fall when prices rise). Tungsten-based products may face competition from products based on other materials but increases in the tungsten price have less of an impact.

Recycling 2.18 Tungsten scrap, due to its high tungsten content in comparison to ore, is a very valuable raw material. Overall about a third of tungsten demand is supplied from recyclate; this also enables the recovery of other critical and strategic metals such as cobalt, tantalum and niobium. Increasing recycling would reduce to a degree the need for new primary extraction of tungsten. However, the growth in demand means that even a very large rate of recycling could not satisfy demand.

3.0 ANSWERS TO SPECIFIC QUESTIONS RAISED BY THE COMMITTEE

Q1 Is there a global shortfall in the supply and availability of strategically important metals essential to the production of advanced technology in the UK?

A1.1 The concept of a shortfall in strategically important metals, such as tungsten needs to be considered not just in relation to our existing technology industries. Perhaps of greater significance is the future impact of a shortfall on those developing, and awaiting development, technology industries that we may not be able to develop because of restricted access.

A1.2 Conceptually, research into new technologies in the UK would not be constrained by shortfalls or limited access to tungsten. While the traditional end use market for tungsten remains strong, new technologies (new catalysts, new alloys, new uses in nanotechnology) based on the unique physical and chemical properties of tungsten are under research and development. Any limitation of access to tungsten would inhibit development of the resulting technologies into industrial scale applications in the UK.

A1.2 There is a developing global shortfall in relation to proven reserves of tungsten that are economically recoverable and ‘available’, in the sense that there are no restrictions on extraction or sales. This shortfall flows from, and is exacerbated by, the dominance of China in reserves, production and consumption. China has also restricted operations within the country, limited mining licences, restricted exports, adjusted export taxes and shifted export quotas to favour ‘added value’ products.

Q2 How vulnerable is the UK to a potential decline or restriction in the supply of strategically important metals? What should the Government be doing to safeguard against this and to ensure supplies are produced ethically?

A2.1 The UK is already vulnerable and affected by restrictions in the supply of tungsten. As China industrialises it will naturally seek to retain a greater percentage of tungsten for its own consumption, maximise the ‘added value’ potential of any exports and seek sales agreements to recover scrap back to China. At the same time; as China improves its regulation of environmental, health and social impacts associated with some of its mining industry; the available supply from China may shrink.

A2.2 The UK has one of the most rigorous and fair planning and regulatory regimes in the World. This regime fits within a local democratic process and within a stable and trusted national political framework. Where the UK has resources and reserves of strategic minerals, the most ethical method of ensuring supplies of strategic minerals to our economy is to provide them from our own resources. Such action clearly removes or reduces any threat of external controls on supply to the UK.

A2.3 Unfortunately, policy for the identification, management and development of the metal minerals for the UK economy has relied for decades on the laissez-faire concept that other nations will provide. This has left metal minerals outside central government policy. The implications of this policy vacuum in a time of developing metal supply vulnerability are now being understood. What is therefore urgently required of government is strong ‘ownership’ within government of metal minerals (and indeed all strategic non-energy minerals) and clear policy on the importance that the UK government attaches to providing minerals from our own resources.

Q3. How desirable, easy and cost-effective is it to recover and recycle metals from discarded products? How can this be encouraged? Where recycling currently takes place, what arrangements need to be in place to ensure it is done cost-effectively, safely and ethically? A3.1 As described above a substantial level of recycling of tungsten already takes place. Currently tungsten scrap from the UK is exported for re-processing to other countries, including those where environmental and ethical issues are less certain. There is the potential to recover this scrap for recycling within the UK if a tungsten processing plant were to be constructed within the UK, probably on the back of processing primary ore from Hemerdon.

Q4. Are there substitutes for those metals that are in decline in technological products manufactured in the UK? How can these substitutes be more widely applied?

A4.1 As a general rule the concept of substitution only transfers demand from one strategic mineral to another strategic mineral. Further the development of new technologies, such as related to energy sources, appears to increase demand on strategic metals creating more pressure or a new shortfall position.

A4.2 There is very limited scope for substitution of tungsten by other metals in the primary end uses. Developing new technologies suggest that the demand on tungsten will increase because its valued and specific properties are non-substitutable.

Q5. What opportunities are there to work internationally on the challenge of recovering, recycling and substituting strategically important metals?

A5.1 The primary objective should be to work with our European partners on all aspects of securing supply of strategically important metals. However, for many metals the challenge cannot be restricted to recovery, recycling or substitution. Substitution often translates supply problems from metal ‘A’ to metal ‘B’ and is an illusory solution. Recovery and recycling can assist supply, but increasing demand, often arising from the very actions of seeking more efficient and less polluting technologies, produces an increase in demand which recovery and recycling cannot satisfy.

A5.2 The bigger challenge (bigger, because other solutions are favored more, but less effective), is the need to ensure that national policy addresses the need for primary supply from our own resources.

4.0 CONCLUSION

4.1 Wolf Minerals believes that the supply of critical and strategic metal minerals is now a significant issue for the UK and welcomes the review. The call for evidence by the Committee comes at an apposite time for the UK. The outcomes of the review can help the UK grasp the significance of the problem but also the opportunities. The outcomes can also help to put in place both the necessary ‘ownership’ of metal minerals within government and the necessary supporting policies at UK national government level.

Wolf Minerals Ltd/17 December 2010

Written evidence submitted by The Environmental Sustainability Knowledge Transfer Network (ESKTN) (SIM 07)

DECLARATION OF INTERESTS

The Knowledge Transformation Networks (KTNs) are funded by the Technology Strategy Board. Their purpose is to promote innovation in the UK. The Environmental Sustainability KTN focuses on developments that can make the UK economy more sustainable. It has no vested interest in the subject of this inquiry. In this response we aim to present a balanced view derived from interactions with our membership of more than 3,000 registered users.

Is there a global shortfall in the supply and availability of strategically important metals essential to the production of advanced technology in the UK?

1. The supply of metallic minerals and global markets tend to respond to the demand. If demand exceeds supply the price increases which stimulates investigations into the use of alternate minerals and the development of new deposits. However the processes involved in discovering and developing a new deposit or substitute material can take many years so there is a lag in the response to demand which tends to result in shortages and price peaks (followed by subsequent price falls when supplies meet or exceed demand).

2. The availability of a metal was in the past determined by price and technology. The richest and most accessible deposits of minerals are exploited first and when these are exhausted lower grade and less accessible resources will be developed if the technology is available to produce the material at a satisfactory price. The cost of energy and environmental impacts are now important elements. The development of lower grade deposits usually requires the utilisation of more energy per tonne of mineral produced. If fossil fuels are used to generate the energy this will increase the ‘carbon footprint’ of the mineral and together with high energy input costs this could have an impact on the demand for a metal.

3. UK manufacturers would like equal access to metals. If this is the case then, even if the price is high, availability is roughly equal for all users and so there is fair competition. However if the supply of a particular mineral or metal is controlled by a small number of entities (be they countries or companies) there is a risk that they may exploit their monopoly/oligopoly to control the market or favour certain clients.

4. If the UK is to be in a position to access strategic metals it must develop policies that recognise the relative risks associated with global supply chains and assist UK businesses to manage these risks. Since the size of the UK market may be small in terms of global demand the UK should be pro-active in engaging in the development of EU policies. The UK needs to be recognised as key player in specific roles within the EU because it would not be possible for each EC member country to aim to be self-sufficient for all strategic metals.

5. However it is not just a question of access; availability in the appropriate form is also important. For example the Nuclear Industry needs large forgings which cannot be produced in the UK at present (the loan guarantee request from Sheffield Forgemasters aimed to address this). Similarly if the UK is to be a leader in Additive Layer Manufacturing a supply chain for metal powders is essential.

How vulnerable is the UK to a potential decline or restriction in the supply of strategically important metals? What should the Government be doing to safeguard against this and to ensure supplies are produced ethically?

6. One problem here is how strategically important metals are defined. In the past this term may have referred to metals with critical roles in military applications. A broader approach would consider materials that are important to the performance of an advanced systems, machines or new technologies. Rare Earth Elements are currently in the news in this respect.

7. A recent EU Study looked at ‘critical raw material’: -

‘With regards to geological availability, the Group observes that, as geological scarcity is not considered as an issue for determining criticality of raw materials within the considered time horizon of the study, e.g. ten years, global reserve figures are not reliable indicators of long term availability. Of greater relevance are changes in the geopolitical-economic framework that impact on the supply and demand of raw materials. These changes relate to the growing demand for raw materials, which in turn is driven by the growth of developing economies and new emerging technologies. Moreover, many emerging economies are pursuing industrial development strategies by means of trade, taxation and investment instruments aimed at reserving their resource base for their exclusive use. This trend has become apparent through an increasing number of government measures such as export taxes, quotas, subsidies etc. In some cases, the situation is further compounded by a high level of concentration of the production in a few countries. This report analyses a selection of 41 minerals and metals. In line with other studies, the report puts forward a relative concept of criticality. This means that raw material is labelled “critical” when the risks of supply shortage and their impacts on the economy are higher compared with most of the other raw materials.’

8. There are fewer facilities for the primary production of metals in the UK than in the past so businesses must import more of the strategic metals required in forms that are suitable for their manufacturing operations or rely on suppliers of the products that contain the strategic metals. Thus from a strictly nationalistic point of view although the UK may not appear to be directly dependent on the supply of strategic metals this should not disguise the fact that the efficiency and competitiveness of important sectors of the economy (ITC, Advanced Materials, Aerospace, Military, Renewable Energy, etc) are reliant on them – even if this may not be apparent because they are imported incorporated in components of machines and products (invisible imports).

9. During normal trading conditions this situation has not resulted in major problems but in abnormal conditions, such as major conflict or other disruption to international trade, the UK would be vulnerable. This situation was recognised after WW1 and strategies to source minerals were developed that mitigated the problems experienced during WWII. However at present the UK does not have a national strategy for mineral/metals supply. The EU has taken cognizance of the security of supply issues and has identified 14 minerals as being critical to the economy of the EU. In the global market it would be difficult for the UK to have a strong position in relation to securing mineral supplies so it is recommended that it develops a policy that aligns with that of the EU. The UK can make some contribution to developing European resources (an Australian company is currently working on the development of a Tungsten mine in Devon).

10. Since many of the UK imports of ‘strategic metals’ are invisible the systems for managing end-of-life materials are important as is the development of policies that promote the efficient utilisation of these important elements.

11. In addition to the security of the supply of energy and mineral resources the UK and EU must also promote ensure the development of the appropriate human resources, technological know-how and infrastructure. Unless all of these issues are addressed the supply of strategic materials could be constrained in the future. Examination of one specific metal that is considered to be strategic in the US will illustrate these issues. Magnesium is a metal that has a wide range of applications; it is particularly useful for applications where ‘light-weighting’ is an important factor (it is less dense than Aluminium) and the utilisation of this metal will probably expand in a low carbon economy. Over the past 10 – 20 years China has become the dominant supplier of magnesium metal. It now produces more than 80% of global metal output whilst primary magnesium producers in Norway and France have been shut down. Another high technology magnesium smelter in Canada closed because it could not compete with low cost imports from China. The sole remaining producer of primary magnesium in North America is only viable because local prices are supported by import duties placed on magnesium from China.

12. With regard to ethical sourcing the leading mining companies based in the UK participate in the sustainable mining programmes and policies of the International Council for Mining and Metals (ICMM). However there are potential problems with ‘invisible imports’ because of the difficulties ensuring the traceability of metals incorporated in the parts or components of machines and equipment. If the broader context of carbon management is included in the ethical considerations then engagement with the EU could be used to expand development work with mineral producing countries to ensure that world class standards for safety, environmental management and economic management are applied in all countries that partner with the EU.

13. About 70% of the Earth’s surface is covered by water. As land based reserves of oil became depleted oil companies began off-shore developments. Mineral exploration has also gone off-shore and was partly responsible for the recent disputes between Japan and China. The potential for off-shore ‘mining’ has been discussed for many years and the first industrial developments have been reported. It is important that the UK engages in this process to ensure that these resources are developed in a way that does not cause significant environmental degradation. Two of the leading marine minerals companies have UK connections (Neptune Minerals and Nautilus Minerals).

How desirable, easy and cost-effective is it to recover and recycle metals from discarded products? How can this be encouraged? Where recycling currently takes place, what arrangements need to be in place to ensure it is done cost-effectively, safely and ethically?

14. In terms of resource efficiency it is very desirable but in the past some primary producers have viewed metal from secondary sources as a potential source of competition. Now many primary metal producers also process secondary materials. There are a number of stages in the chain of utility where metals can be recovered/recycled. The following diagram from a publication from the International Panel for Sustainable Resource Management (Metal Stocks in Society) give a good illustration of these: -

Key (Note - one additional ‘stock’ added to represent process losses)

1 Metal in virgin ore bodies 2 Metal in tailings 3 Metal in Processor stockpiles 4 Metal in Government stockpiles 5 Metal in Manufacturer stockpiles 6 Metal in-use stocks (in the 'Technosphere') 7 Metal in Recycler stockpiles 8 Metal in Landfill stockpiles 9 Metal Losses (in transit, in off-gases, effluent streams, etc)

15. It can be difficult to recover some of the metals that go into the manufacture of products and systems because of the number and complexity of the components and sub-assemblies and the joining techniques employed. It is particularly difficult to do this efficiently where there are a wide range of metals used in components and sub-assemblies or the valuable elements are present in low levels or are associated with incompatible materials. It is important that engineers and designers are trained to optimise material selection and to consider the fate of all the materials employed at the end of the product life. If more sustainable ways of managing metals are not adopted the global demand for primary metals will continue to grow and put increasing pressure on prices and supplies. Better management of information on the composition of components and assemblies would facilitate more intelligent management of end-of-life materials.

16. In Japan there is a national body that supports Japanese access to raw materials (JOGMEC) and they have a strong National Research Institute for Metals (NIMS). Within this organisation they have a specific group working on strategic materials (Center for Strategic Natural Resources). In 2009 they developed an innovative system for recycling mobile phones and in 2010 they reported on the recovery of cobalt and gold from urban waste.

There is also a Research Center for Materials, Cycles and Waste Management at their National Institute for Environmental Studies (NIES). ‘Sustainable Material Cycles’ is one of NIES’s priority programmes and their research objectives include:-

• Projecting the amount of recyclable resources and waste that will be produced in the next 10 to 20 years and setting strategic targets using relevant indicators for material-cycle management. • Designing concrete scenarios including technologies and policies, and identifying the specific issues to be solved to achieve such targets at both the local and national level.

17. The transitions that have occurred in the UK economy are such that the UK is no longer a significant importer of many primary ores (the main exceptions are iron, aluminium, lead & nickel). The fact that a large proportion of the components and equipment utilised is imported means that significant quantities of secondary metals are available when these imported items reach the end of their useful life. The UK is currently a net exporter of scrap metals – some in a semi-processed state. This scrap is then processed (or discarded) in other countries.

Are there substitutes for those metals that are in decline in technological products manufactured in the UK? How can these substitutes be more widely applied?

18. Given the rapid development of some Asian economies there is continued growth in total global demand for all metals even if the intensity of use of some metals has declined in developed economies.

19. There are some applications where technological change can reduce the use of metals for specific applications (fibre optic cable replacing copper wire, mobile phone networks, etc). In other cases optimising design can reduce the quantities of metal required to deliver a specific function. All manufacturers must strive for innovations that can provide them with advantages in the global market. Where the UK can be innovative is in the development of new materials, the exploration of new forms of materials and the utilisation of materials for new technologies. If the UK is to be competitive on a global scale it must train more material scientists and ensure that all engineers and designers are trained in the concept of sustainable materials management (SMM). Economies that have been successful in building their technological base (Japan, South Korea & Taiwan) have supported R&D in materials and encouraged businesses to develop new materials and applications.

What opportunities are there to work internationally on the challenge of recovering, recycling and substituting strategically important metals?

20. Clearly there are other organisations and countries that are examining the issues relating to the supply of strategic materials (see recommended references below). Scandinavian countries have important metals and minerals industries and countries like Germany, Holland and Belgium are developing systems to support a transition towards more sustainable materials management. Here in the UK the Institute of Materials, Minerals and Mining (IoM3), in association with the Environmental Sustainability KTN, Tata and other sponsors, recently held a conference on ‘Innovation Towards Sustainable Materials’. The head offices of several global mining organisations (Anglo American, Rio Tinto, etc) are based in London and many other mining and metallurgical groups are listed or source

financing in London. Mining companies are working towards more sustainable practises and their programmes of continuous improvement in global mining operations through the international organisation, the ICMM, should be encouraged and supported.

21. There is one specific opportunity that the UK should endeavour to make a significant input to in a current EU Framework 7 funding call. The aim is to establish a network to co- ordinate R&D in the EU:-

‘The objective of the ERA-NET is to step up coordination of research programmes in the field of industrial production and supply of raw materials. This should be achieved in line with the integrated strategy proposed in the EU Raw Materials Initiative (RMI) by improving use of the EU mineral resources through innovative exploration, extraction and processing technologies; and by reducing the EU's consumption of raw materials through new industrial processes increasing resource efficiency, recycling and substitution.’

22. With regard to secondary metals there are opportunities to look at how these can be recovered from existing products that at the end of their useful life. As indicated above the Japanese are very actively developing technologies for managing secondary materials. Given the similarity between these two island economies, both reliant on imports, it would make sense to identify mutually beneficial collaborative research programmes with the appropriate Japanese entities. A TSB funded mission to Japan is planned for 2011.

23. It also important to move from ‘end-of-pipe’ solutions and the UK businesses can differentiate themselves and become more resource efficient by ensuring that future designs are developed in ways that support remanufacturing, recovery and recycling. DEFRA have supported the Centre for Remanufacturing and Re-use (CRR) and it is important that the potential for re-manufacture and re-use are built in to products and systems at the design stage. To enhance the ability of UK manufacturers to compete in the global market it is important that the UK develops policies that help to maintain existing expertise and develop new areas that support the EU agenda for sustainable materials.

24. Despite the decline in the metals industry in the UK there is still production of significant quantities of steel and aluminium from primary and secondary sources. It is important that the existing capacity and know-how is retained and extended. Some examples are listed below: -

Carbon Steels for the automotive and construction industries (Tata Steel, CELSA, Thamesteel, etc)

Alloys steels, including stainless steel for advanced applications (Sheffield Forgemasters, Outokumpu, Doncasters, Goodwins, etc)

Nickel alloys for aerospace, chemical and specialist applications (VALE, Special Metals Wiggin)

Aluminium & aluminium alloys (Rio Tinto Alcan, Aleris, LSM, Novelis etc))

Lead from primary and secondary materials (Xstrata Zinc, Enthoven)

Platinum group metals from secondary materials (Johnson Matthey, BASF /Englehard)

Rare Earth Element & alloys (Great Western Mining Group/LCM)

Magnesium (Magnesium Elektron)

25. There is potential for improving the way in which metals are recovered from secondary sources (end-of-life products and ‘waste’ streams). It is important to devise efficient ways of harnessing the optimum value from ‘invisible’ metal imports. The recovery of some metals is relatively simple but the thermodynamic properties of some alloys means that the constituents are difficult to separate or purify. These factors must be taken into account when materials are specified for a specific component and application. It is important we develop ways of tagging components with some means of identification that can record the properties of the materials that have been used to make them. It would then be easier to identify the valuable metal(s) at end-of-life and recover the maximum value from the constituents.

26. At present the UK exports significant tonnages of metal scrap, in various forms. Between 2004 -2008 the UK was a net exporter of steel copper, aluminium and lead (~ 36 million tonnes total, of which 31 million tonnes was iron and steel). Income from these scrap sales was about £8 billion although these could be viewed as exports of carbon credits.

27. This inquiry is very timely because if the UK is to transform into a low carbon economy it must put in a place a coherent policy for sustainable materials management (SMM). If life cycle thinking is employed at the product design stage this improve effective metal utilisation, reducing the overall energy and carbon burdens. To date the focus has tended to be on energy generation and ‘greenhouse’ gas emission issues but policies to promote SMM would accelerate the transition to a low carbon economy. These should stimulate a more efficient approach to metal utilisation and enhance the UK’s capacity to manage strategic metals. There are significant quantities of these strategic metals in the ‘technosphere’ and countries like Japan and Sweden are conducting R&D into ways of recovering valuable metals from ‘mines above the ground’, ‘urban mines’, and landfills.

28. The UK cannot turn back the clock but with the correct policies it could become a leader in the development of products designed using ‘life cycle thinking’ and play an important role in the development of SMM. The ES-KTN and the Sustainable Development Group of the IoM3 are working to promote this approach.

The Environmental Sustainability Knowledge Transfer Network

17 December 2010

Supplementary written evidence submitted by The Environmental Sustainability Knowledge Transfer Network (ESKTN) (SIM 07a)

Q “In response to question 41 (see the transcript of the session), you mentioned that mining companies “wouldn’t even look at deposits in Europe because they know it is going to take them 10 or 15 years to go from discovering the deposit to getting into production”. You implied that a large chunk of this time was taken up by the planning process. Are you able to expand on this a little? For example, how much of this time is because of the planning process and why does it take so long?”

I will try to expand on this point in general on the understanding that this is generalised interpretation of the situation rather than a detailed review of specific cases (which would be difficult to do in the case of the UK because I cannot recall the opening of any new metallic mineral mine in the UK in recent years). If you read the response below in conjunction with some of the Oral evidence given by Professor Manning I hope this will clarify the situation. Please also refer to the attached paper, by UK experts, which looks at both mining and quarrying in the UK.

The whole process of identifying a mineral deposit is itself an expensive process and risky process. Ideally mining companies would like to identify large deposits of high grade material. Exploration geologists conduct surveys to identify signs of potential for deposits and then they must conduct detailed exploration work to determine if the deposit might be economically viable. This can include extensive drilling and mineral processing test work. Mineral exploration companies are unlikely to invest in development work in locations where the mineral exploration rights are unclear and /or there is a high probability that an operating permit may not be granted – or will be only be received after long delays. This is probably the case in many European countries. This is partly due to issues related to population density and land use and these are less of a problem in parts of Scandinavia where they have encouraged some mineral development.

As Professor Manning points out the distribution minerals is determined by geology and a mining industry cannot be developed where there are no mineral deposits. The EU Study on Critical raw Materials points out that the EU is highly dependent on imports of many metals but unlike the USA and Japan does not have strategy for managing supplies. It suggests that where possible the EU should look for potential to reduce dependence on imports. This could be achieved by identifying and developing new deposits which would require significant investment in exploration. It may also be necessary to look at the development of smaller and/or lower grade deposits and research is required to look at mining and processing methods that could make these processes viable.

If we look at the issues relating to the development of a project in the UK these could be summarised as: ‐

• Mining not seen as an important part of the economy • The perception is that the easy deposits have already been exploited and there is little chance of finding a large/rich deposit • Uncertainty about the rights to prospect. • Uncertainty about the mineral rights • Complications in the planning process ‐ local/national/EU regulations, interpretation of Environmental Impact data, potential for objections and delays • Classification of land as of some form of special interest (archaeological, habitat, etc) • Tax scenarios (mine development is encouraged in some countries) • Availability of expertise and cost of personnel

It has also been suggested that the lack of clear statement from central government as to the importance of minerals which leaves the planning process (and the courts, who might review the legality of a planning decision in terms of national policies) open to pressure of "yes, but not here". This probably takes us onto the wider question of the general public’s perception of mining operations. These are often based on views based on historical descriptions of operations and incidents but the modern mining industry takes its responsibilities seriously and aims to develop mineral using the most sustainable methods available (see attached paper and information on Sustainable Development from the ICMM).

So in many ways the cards are stacked against developments in the EU relative to other parts of the world where mining can be seen as an important part of the economy. However if the EU/UK wants to reduce its dependence on imported materials it must consider developing the appropriate strategies. Policies to support R&D in minerals and the development of appropriate deposits could reduce supply risks. Developing a mining project to the stage when investors are prepared to fund a project is a difficult and expensive process – local conditions that make it more difficult will deter development activity.

Please don’t hesitate to contact me if we might be of further assistance.

Tony Hartwell The Environmental Sustainability Knowledge Transfer Network (ESKTN)

8 February 2011

Written evidence submitted by the Society of Chemical Industry Materials Chemistry Group (SIM 08)

Inquiry into Strategic Metals

Background:

[1] Materials Chemistry is a special interest group of the Society of Chemical Industry; it has approximately 400 members drawn from:

(i) The industrial sector, which represent a broad spectrum of basic research and development, manufacturing and processing technology as well as senior managers and directors who are responsible for wide ranging policy development.

(ii) Academics and emerging young scientists that constitute a core segment of UK fundamental and applied research and technology transfer.

[2] The Group, through the Society, is a major forum for bringing together groups of scientists from specific disciplines, fostering exchanges of ideas, forming research and technology networks, identifying future direction and formulating strategic policy.

Through beneficial collaborations with the Royal Society of Chemistry, the Institute of Materials, Minerals and Mining and the Institute of Physics it provides the main UK spine of interaction for all those interested in Materials Chemistry and related matters.

The Group and the Society membership is therefore a major source of knowledge and opinion relating to metals and alternative materials technologies; for this reason we wish to register our interest and our willing to contribute to this enquiry.

[3] We note the well established major general increase in the consumption of metals which began in the last century, shows no sign of abating and is likely to be exacerbated by high- volume emerging economies.

[4] We note also the potentially vulnerable position of the UK in that present sources of metals required to fulfil its own needs are largely external.

[5] Since metal recovery and processing are largely energy intensive processes, it is also clear that there exists a paradox in terms of national and world supply in relation to burgeoning green and environmental issues.

Specific Materials Chemistry Issues

[6] The Group and Society interest and expertise impinge on Strategic Metals in a number of key areas, these are described below.

[7] Metallurgists and other scientists working directly in the metal sector and specifically those responsible for strategic planning and new technologies; clearly these have a critical role in both problem solving and deciding lead policy matters.

[8] An additional but critical area is that of alternative materials; here, to give but a few examples, composites provide alternative structural materials, hard coatings (such as diamond and other plasma CVD methods) offer wear-resistance and bearing surfaces, porous carbons for battery and other energy uses and improved efficiency in metal dispersion for catalyst systems all have a huge amount to offer in relieving pressure on essential metal technologies.

[9] Related to [8] are emerging alternative processing technologies which increase efficiency in existing methods or offer new routes to end products with less waste etc. A typical example is low energy separation and extraction methods.

[10] Finally, there are related policy issues of fundamental research, technology development and transfer which in the mid to long term both improve greater efficiency in, and provide viable alternatives to, present metal solutions.

[11] In short, it is our opinion that, though complex, the problems associated with strategic metals are not insoluble and that, amongst others, the membership of the SCI has a critical contribution to make.

Professor Bob Bradley (Chair SCI Materials Chemistry Group) Dept. Of Materials University of Oxford

16 December 2010 Written evidence submitted by the Mineralogical Society of Great Britain and Ireland (SIM 09)

Inquiry into Strategically Important Metals

Declaration of Interests

1. The Mineralogical Society of Great Britain and Ireland (Mineralogical Society hereafter) is a learned society that aims to advance the knowledge of the science of mineralogy, and its application to a range of subjects, including among others the exploitation, processing and recycling of economic minerals.

2. The Mineralogical Society has approximately 1000 members, the majority of whom are students, researchers and academics from universities and other scientific institutions, in the UK, Ireland and abroad. Many of these scientists work in fields with direct application to the question of strategically important metals. These include the nature and properties of minerals; the processes by which they are formed and concentrated; extraction methods; metallurgy; and mineral processing. The Mineralogical Society has a number of Special Interest Groups, including an Applied Mineralogy Group.

Overview

3. Strategically important or ‘critical’ metals have been the subject of a recent report by the European Union (EU), which identified a list of critical raw materials for the EU (http://ec.europa.eu/enterprise/policies/raw‐materials/critical/index_en.htm) . This submission assumes that the list of critical metals for the UK corresponds strongly to the EU list. The UK does not currently produce any of the metals on that list from primary indigenous sources, although potentially economic deposits of some metals do exist in this country; an example is the Hemerdon tungsten deposit in Devon. The lack of indigenous production means that the UK is vulnerable to security of supply issues.

4. Research carried out by scientists within the UK has the potential to address many aspects of critical metal supply, including:

• Understanding the processes by which ore deposits are formed, and identifying hitherto unrecognised deposits. Many of the critical metals on the EU list have only become economically important in recent times, and thus their deposits have been the subject of limited research. • Understanding of mineral properties, which is fundamental to recovery of critical metals from waste streams and through recycling. • Development of substitutes for critical metals.

Q1: Is there a global shortfall in the supply and availability of strategically important metals?

5. Although the known global reserves of critical metals may be limited at this point in time, it is anticipated that as market forces drive research and exploration, new reserves will be discovered and developments in extraction and processing will allow these to be exploited. Global geological resources of these metals are thought to be considerable, although estimation of the total extractable resource is difficult. In the short term, geographical and political factors are of more concern: many critical metals are only available from a small number of sources, some of which are in the world’s more unstable countries. The EU is almost entirely dependent on imports of most of the critical metals. There is thus a possibility that supply and availability of any of these metals could be limited at times in the next few years.

Q2: How vulnerable is the UK to a potential decline or restriction in supply?

6. The UK currently has no production of any of the critical metals from a primary source. UK supplies of these critical metals are dominantly from non‐EU sources, and many critical metals are supplied from only one or two countries; for instance, almost all the world’s tantalum is produced in the Democratic Republic of Congo. Political disruption in such countries could significantly affect supply of these metals to the UK.

7. The UK is considered to have significant reserves of some of the critical metals, particularly in the historical mining area of SW England, although areas such as the Highlands of Scotland and parts of Wales also potentially contain exploitable deposits. Issues of cost, environmental considerations, and planning have restricted mining in these areas in recent years. Clearly, exploration and mining of critical metals within the UK would provide the country with some security of supply, as well as bringing economic benefits to rural areas.

8. Despite the current lack of metalliferous mining within the UK, the UK is still a global centre for mining finance and home to two of the world’s largest mining companies (Rio Tinto and Anglo American). There are many other mining and exploration companies and mining consultancies, of a range of sizes, based in the UK. They are working worldwide on a range of resources including critical metals, are contributing to the UK economy, and are in a position to aid the supply of critical metals for UK industry.

9. The UK has a reasonably strong research base in ore deposit geology, but relatively little research funding is currently directed into this area. Furthermore, only one university offers a degree course in mining engineering or graduate course in mining geology (Camborne School of Mines, University of Exeter), and the level of ore deposit geology taught as part of mainstream undergraduate geology courses is variable. To ensure that the UK retains the skills and knowledge needed to identify and exploit resources of strategic raw materials, it is essential that research and education in these areas is supported.

10. Promoting more rapid routes from exploration to exploitation of deposits is vital in ensuring security of supply. Efficient use of resources requires comprehensive understanding at the exploration stage of how a deposit will perform when processed through mining, concentration and extraction of the elements of interest. This 'geometallurgy' needs interdisciplinary research between geologists, mineralogists, specialists in geostatistics, minerals and mining engineers.

11. On the subject of ethical production, it is important that mining of critical metals in developing countries is responsibly managed and associated with positive financial, social and environmental impacts. We note that it is possible to use a scientific approach to ‘fingerprint’materials and identify their source ore deposit. As an example, the German geological survey has used a variety of analytical techniques to ‘fingerprint’ tantalum ores from Africa. Many organisations are working on methods to ensure responsible sourcing, and more research is needed to identify the best ways in which this can be ensured.

Q3: How desirable, easy and cost‐effective is it to recover and recycle metals?

12. Recycling is one important strand of critical metal supply. However, many of the critical metals have only recently become important in components for new technologies, and thus the resource available to be recycled is limited. Further research into recycling processes is needed to increase efficiency.

Q4: Are there substitutes for those metals that are in decline?

13. Substitutes have not yet been identified for many of the critical metals that are used in new technology applications. Further research in this subject is urgently needed.

Q5: What opportunities are there to work internationally on the challenge of recovering, recycling and substituting strategically important metals?

14. Many scientists working in these fields already collaborate widely with other academics and colleagues in industry from around the world. The UK scientific community will continue to address these questions, but the availability of research funding is a key constraint.

The Mineralogical Society of Great Britain and Ireland

17 December 2010 Written evidence submitted by The Geological Society of London (SIM 10)

STRATEGICALLY IMPORTANT METALS

1. The Geological Society is the national learned and professional body for Earth sciences, with 10,000 Fellows (members) worldwide. The Fellowship encompasses those working in industry, academia and government, with a wide range of perspectives and views on policy-relevant science, and the Society is a leading communicator of this science to government bodies and other non-technical audiences.

2. We are grateful for the opportunity to submit evidence to this inquiry. Given its broad scope, we have not attempted to provide detailed information regarding particular strategically important metals, and have focused on general principles. We understand that the British Geological Survey (BGS) is taking a lead role, through NERC, in a coordinated response from the Research Councils. The Minerals Section of BGS constitutes an important component of national capability in this area, as a centre of expertise and as the source of vital strategic data (see for example their UK Minerals Yearbook, and their publication World Mineral Production 2004-2008).

3. The Geological Society’s response has been prepared on the basis of contributions from its Fellows and others, and in particular from the Mineral Deposits Studies Group (MDSG), which is an affiliated specialist group of the Society but includes non-Fellows among its membership.

4. The Geological Society is currently preparing a public statement on the rare earth elements, which will be aimed both at policy-makers and at interested members of the public, and which we expect to publish in Spring 2011.

Is there a global shortfall in the supply and availability of strategically important metals essential to the production of advanced technology in the UK?

5. There is no definitive list of ‘strategic metals’. They are generally taken to include the rare earth elements (REEs), platinum group metals, tantalum, niobium, indium, lithium and tungsten, among others. Some would include more common metals such as tin, not because there is concern over continuity of supply, but because the volumes in which it is used mean that the volatility of its price has significant economic impact. Some non- metallic elements such as phosphorus can also be considered ‘strategic’. More generally, the significant strategic drivers are likely to vary between metals and across different usages. Economic importance is not the only factor – environmental protection, national security and other benefits may also be significant. Particular importance is now quite rightly attached to the resource implications of low carbon energy technologies (more efficient electromagnets for wind turbines, extensive use of photovoltaic panels, catalytic converters in vehicles, etc). The economic and technical barriers to extraction, substitution and recycling of different metals, and in the context of differing uses, vary. In some senses, the supply of all important minerals and other resources (energy, water) is strategically important, and raises the need to weigh economy of use, security of supply and environmental factors, and to make judgments which are hybrids of the technical, social and political.

6. It is important to distinguish between ‘reserves’ – that is, the known resources in the ground which can be extracted economically using existing technology –and the total physical resources in the Earth’s crust. We are confident that known reserves of metals which might be considered strategically important are small compared to the total amount in the ground. The primary constraints to their supply are therefore economic, geographical, legal and technical. Which ore deposits are considered to be ‘reserves’ will depend not only on fixed factors (the geographical distribution and concentration of metals), but also on variable ones – commodity prices (increased prices may make a metal economic to extract at locations where it wasn’t before), the discovery of new exploitable resources (which is dependent on research and exploration work), regulatory regimes and improved technology for extraction.

7. Global metals production levels can also respond to price, but the long lead time from the instigation of an exploration programme by a company to mine production – typically at least 10 years (with success far from certain) – severely restricts market responsiveness, particularly when existing production is concentrated at a few sites. For instance, 95% of global production of REEs is located at a small number of mines in China, although there are known reserves elsewhere, and every prospect of finding more. This leaves the global market vulnerable not only to price changes but also to artificial constraints on supply.

8. The REEs have similar physical and chemical properties. They tend to occur together in the same deposits, and are difficult to separate. (The same is true of the platinum group metals.) In considering the supply and economics of the REEs, the proportions of particular elements in a deposit is significant. Those in which the level of Heavy REEs (those of higher atomic number) is unusually high tend to be more economic, because they are of lower overall abundance in the Earth’s crust than Light REEs, and because they can have lower associated separation and enrichment costs.

9. Internationally, extraction and processing are associated with significant environmental impacts. These may arise from the nature of the mining process itself (e.g. some large open-pit mines such as at Bayan Obo, China), the association of metals with radioactive elements (e.g. REEs with uranium) or toxic pollutants, and refining processes. Standards in some countries have been low – recent attempts to improve them are of course welcome, but may lead to increased prices.

How vulnerable is the UK to a potential decline or restriction in the supply of strategically important metals? What should the Government be doing to safeguard against this and to ensure supplies are produced ethically?

10. In addition to the UK’s dependence on China for REE supply (in common with other countries), we rely almost entirely on the import of other strategic metals used in UK industry. Only very small proportions of strategic metals used in UK industry are produced in the EU (where unfettered availability is most reliable), and many are produced in a limited number of countries. For example, compared to its imports, the EU produces only 1.3% of antimony, 10% of tungsten and no niobium, tantalum, platinum group metals or REEs (BGS European Mineral Statistics 2004-2008). The UK currently has essentially no metalliferous mining activity, despite its historical importance.

11. There is considerable potential to reduce our vulnerability with regard to some strategic metals through domestic production. We believe that the UK has significant potential reserves of some metals, such as indium and tungsten in south west England. The country remains underexplored by modern mineral exploration methods, due to the lack of current mining activities. However, the UK has the advantage of a world renowned mineral deposits research community, including not only university scientists, but also those in BGS, NERC isotope facilities, and the Mineralogy Department of the Natural History Museum. Their research addresses the formation of metal deposits and developing successful exploration strategies for locating them, coupled with safe, efficient and environmentally sound exploitation of these deposits, and scientists in this field have been active in international scientific bodies (such as the Society of Economic Geologists) and publications. UK leaders of the global industrial community include Dick Sillitoe, a world renowned ore deposit consultant, and Graham Brown, Head of Exploration at Anglo American. Moreover, there is a thriving UK-based mining and exploration industry, which comprises over 15% by market value of the FTSE 100 and around 25% of AIM; in addition London is a key market for emerging mining companies to raise capital, including those active in strategic metals extraction. Companies such as Anglo American and Rio Tinto extensively recruit UK geology graduates.

12. There is a continuing need for sustained high-quality research in a number of areas. It is essential to the search for new reserves, to improving the efficiency and safety of extraction and processing, and to mitigating and remediating environmental impacts. The geological origins of major deposits of REEs such as Bayan Obo, for instance, have been disputed, but recent research has been resolving some of the uncertainty. Unless we understand the origins of these deposits, we cannot build an effective predictive model to inform the search for new potentially economic deposits, and the assessment of known ones. There is potential also to identify new source mineral species (that is, distinct minerals as characterised by their chemical composition and crystalline structure) beyond the restricted number currently used, which reflect historical practice and the state of existing processing technology – as new extraction and processing technologies emerge, other mineral species may become viable. This depends on an understanding of the nature and behaviour of the complete geodiversity of natural minerals – an area in which the Natural History Museum plays a key national role alongside the universities. There are some claims that it may be possible to extract strategic minerals from the sea floor, or by concentrating them from sea water itself – the high level of UK expertise in oceanography, and the potential marine resources available to us, make this an attractive area of research. It is also vital that appropriate high- quality strategic data are gathered, on UK, EU and global reserves, production and end- uses – an important aspect of BGS’s national capability role, which is also of international significance. Some Fellows have expressed the view that this area is relatively neglected by NERC with regard to research funding, and that if the next generation of mineral deposits researchers is not nurtured, the community will lose critical mass and not be self sustaining. Research in this area will not attract talented early career scientists if its funding is uncertain. If our expertise and national capability in this area is not maintained, we are likely to lose out to other countries in term of potential economic benefit, security of supply, and influence over the development of technologies and standards for environmental protection. As well as ensuring sustained funding of research and data gathering, we would urge Government to support the training of geologists at undergraduate and postgraduate level to ensure that this research community continues to thrive.

13. Government should also address the inconsistency between national mineral supply objectives and local planning policy and practice. There are reserves in the UK which have been identified as economic to exploit, but whose development has been prevented by planning hurdles. With modern mining and extraction techniques coupled with high levels of environmental safety awareness and protection, we believe that it should be possible in most instances to satisfy reasonable concerns as well as to deliver local and national economic benefit. We would be happy to provide details of specific instances if this is of interest to the committee. A further potential legal obstacle under English law is the separation of mineral rights from land ownership.

14. The current increased focus on the supply and use of strategic metals is welcome. To be of value, it must be sustained. Government should pursue a joined up strategic approach, which recognises the shared and distinct features of the political economy of different metals and applications. Significant effort is being devoted to this matter in other countries. China makes significant and fruitful investment in REE research, for instance at the Baotou Rare Earth Research Institute, and is gaining international acclaim for such work. Not all of it is shared internationally. In the USA, the Mountain Pass mine, which was previously the source of much of the world’s REE supply but which closed in 2002, is currently undergoing expansion and modernisation, and is expected to return to production during 2011. REE deposits are also being investigated elsewhere in the USA, as well as in Australia, Canada and South Africa.

How desirable, easy and cost-effective is it to recover and recycle metals from discarded products? How can this be encouraged? Where recycling currently takes place, what arrangements need to be in place to ensure it is done cost- effectively, safely and ethically?

15. The Geological Society is not generally well placed to comment on classical recovery and recycling (that is, from products), nor on the technological development of substitutes. We note the importance of considering the whole product cycle, including recycling, at the design stage (so called ‘cradle-to-cradle’ design), particularly with reference to degradation and dispersal of materials.

16. A potentially significant future source of strategic metals, in addition to primary ore extraction and the recycling of products, is to extract them from industrial waste materials. For example, a research team at the University of Durham led by Professor Jon Gluyas is taking a novel holistic approach to multiple resource cycles, and delivering highly promising results. If waste material can be used to generate a valuable commodity, so that the ‘back end’ of one resource cycle becomes the ‘front end’ of another, it may be possible both to make net gains in economic and energy efficiency, and reduce overall environmental impacts. They are investigating waste streams such as spent oil shales, fly ash and slags, not only to identify potentially economic metal content (REEs, transition elements and platinum group elements), but also to reuse the waste materials to sequester CO2 (potentially even acting as a net carbon sink), or to create new synthetic materials (for instance, to use as an absorbent and photo-catalyst for the degradation of oil spills at sea). They have shown that the retorting process for generating oil from shale, for example, leaves increased REE concentrations in the residual shale – and that the relative level of enrichment is greater for Heavy REEs (see paragraph 8). While these do not approach the concentrations in primary ores, which are typically five times higher or more, it may be possible to extract these metals economically, given that there are no extraction costs, particularly if in future the processes for extraction of both the oil and REEs can be refined to maximise overall efficiency. There are 100 million tonnes of oil shale spoil heaps in West Lothian, representing a significant potential resource, though not all is available for use under current planning regulations. Such an approach would be of particular value in the context of REEs, where there is currently limited capacity for recycling given their growing use and the relatively small total quantities which exists in products which might be recycled.

17. The expertise of academic and industrial Earth scientists with regard to assessment and efficient processing of primary metal ores (and of the waste streams from other processes as outlined above) is likely also to be of value in some cases of classical recycling of products.

Are there substitutes for those metals that are in decline in technological products manufactured in the UK? How can these substitutes be more widely applied?

18. We note that the use of specific REEs has shifted in some cases over recent years – for example, neodymium has tended to replace samarium in rare earth magnets (neodymium being naturally more abundant). Development of potential substitutes must be informed by their resource implications, including mineral resources. This again depends on our understanding of the full geodiversity of minerals, and on the research underpinning it.

19. We are not aware of any viable substitutes at present for strategic metals in a number of key technologies – in particular, platinum group metals in catalytic converters, and REEs (particularly neodymium) in supermagnets used in wind turbines and hybrid cars.

What opportunities are there to work internationally on the challenge of recovering, recycling and substituting strategically important metals?

20. There is potential for the UK to take a leading role in research into the recovery of strategic metals from the waste streams of other resource cycles, discussed above, and in its development through to industrial application. This could also deliver economic benefit.

21. The BGS has an excellent track record of disseminating best practice regarding economically and environmentally efficient extraction processes globally, particularly in the developing world, and it is to be hoped that it will be possible to continue this invaluable work in future.

Concluding remarks

22. The Geological Society is delighted that the committee has chosen strategically important metals as the subject of an inquiry, and we hope that the Government will also recognise the need to consider these issues. We would be pleased to discuss further any of the general points raised in this submission, to provide more detailed information, or to suggest oral witnesses and other specialist contacts, should this be of interest.

The Geological Society of London

17 December 2010 Supplementary evidence submitted by The Geological Society of London (SIM 10a)

ADDITIONAL SUBMISSION TO HOUSE OF COMMONS SCIENCE AND TECHNOLOGY SELECT COMMITTEE ENQUIRY: STRATEGICALLY IMPORTANT METALS

1. During oral evidence on 26 January 2011 the Committee asked the Society to clarify paragraph 13 of our submission dated 17 December 2010.

“With modern mining and extraction techniques coupled with high levels of environmental safety awareness and protection, we believe it is possible in most instances to satisfy reasonable concerns as well as to deliver local and national economic benefit. We would be happy to provide details of specific instances if this is of interest to the Committee”.

2. This additional Memorandum provides such details by giving selected examples. In exploration and production all these operations make a significant positive contribution to their local as well as their national economy.

Cononish (Scotgold Resources Ltd, Grampian Region)

3. Current resources at Cononish are estimated at 163 kozs and 596 kozs of Au and Ag respectively (in Measured, Indicated and Inferred categories). The contained metal content at current prices is valued at approximately £140m making the operation highly profitable. (The resource estimate does not include Te as previous explorers did not assay for Te - but reserves are probably of the order of 7 tons which would significantly contribute to European production; global use is less than 200 tpa) An independent consultant’s report indicates an exploration target of an additional 0.5Mt to 1Mt of ore within a few kilometres of Cononish. There is an exploration target of 0.5Mt - 5Mt at Beinn Udlaidh based on breccia pipes and Scot Gold Resources Ltd is probably quite close to defining a few more targets in the next 3 to 6 months of a similar size to Cononish within a 15 km radius of Tyndrum. Their wider exploration area covers some 4000 km² which is believed to be prospective for gold and other metalliferous deposits. At present, the company employs four staff directly and two others as consultants on exploration and would hope to increase this as things move forward. To date probably in excess of £4m has been spent and the cost of investigatory work completed previously on Cononish and the surrounding area probably amounts to £5 – 10m, much of this sum being spent locally. The exploration potential of the Dalradian rocks of the Scottish Highlands is well documented and demonstrated in equivalent rocks elsewhere (for example, Sweden, Norway, Canada and US) and success in developing a working mine at Cononish will attract further exploration. 4. Based on present resource estimates the mine in production will employ 52 people year- round in full time positions with an annual wage bill in excess of £2m. The necessary skills are largely available locally. The estimated impact using ONS multipliers suggests a contribution of around £50m to the UK economy overall. This does not consider downstream value added to possible products. Although at an early stage, the company is looking at a partnership to promote some form of Scottish Gold Jewellery manufacturing locally or in Scotland using this unique product. Additionally the local community are most supportive of the proposals and wish to set up some form of 'tourist' attraction based on historical mining in the area and obviously Scotland's only gold mine - this hopefully will add post-closure more sustainable benefit in the area.

5. In terms of satisfying planning and environmental legislation, the initial application was turned down largely because of concerns about 'visual' impact in the National Parks but since refusal Scotgold Resources has been working to meet these concerns by reducing the size of the tailings facility and by incorporating some underground disposal. For environmental reasons, a gravity/flotation process rather than the use of cyanide will be employed. Plant has been designed at additional cost to minimise the footprint - modularised and contained in a single building rather than a traditional design. The location demands the highest environmental and planning standards and it is perhaps significant that the Scottish Environmental Protection Agency withdrew their objection. The company is currently sufficiently encouraged to re-apply for planning permission.

6. Although Cononish is planned to be a small mine, and there are few of equivalent size in the UK, there are many mines operating profitably in similar 'legislative' regimes where the highest standards of environmental and societal protection are required. Examples can be found in Canada, Australia and Sweden.

7. The Committee is welcome to visit the mine if it would find that useful.

(Based on narrative provided by C J S Sangster of Scotgold Resources Ltd)

Other examples

8. Although not concerned with metalliferous mining, the following examples illustrate that extraction and restoration is compatible with meeting the highest environmental planning requirements.

Needingworth sand and gravel (Hanson Aggregates, Cambridgeshire)

9. Extraction is expected to span over 30 years, during which time 28 million tonnes of sand and gravel will be removed. The restoration will be phased over the extraction period to include Britain’s biggest reedbed (460 ha) along with open meres, wet scrub and grassland, within a 700 ha nature reserve (in conjunction with RSPB).

Wicken silica sand (Sibelco UK, Norfolk)

10. The site is a modern extraction and processing site and is the largest quarry in the UK for the supply of sand for glass making. Sands for foundry castings are also supplied from the site. The restoration of the quarried areas has been an ongoing activity for much of the past 100 years and large areas have been re-instated to woodland, lakes, heathland and grassland. Many of these areas are open for public access, some are operated as leisure businesses and some of the heathland restoration areas are actively managed with limited or controlled access in the interests of nature conservation. Several Sites of Special Scientific Interest (SSSIs) are present in the vicinity, including part of the old quarry workings at Leziate. Adjacent to this geological SSSI is an RSPB nature reserve, following a donation of land from WBB Minerals. The Wicken North restoration area has won an award from the Norfolk Branch of the Campaign to Protect Rural England (CPRE).

Plenmeller coal (UK Coal, Northumberland)

11. Coal has been extracted in the area of Plenmeller since the late 19th century. In 1987, planning consent was issued to British Coal (now UK Coal Ltd) for opencast coal extraction, and digging started in 1988. Following a public enquiry, planning consent was issued on the condition that approximately 190 ha of the site were restored to upland heathland incorporate cotton grass, mat-grass, heath rush, heather and sphagnum moorland plant communities. Despite being in the early stages of habitat establishment, the site is already attracting many important species of birds such as Lapwing, Curlew, Redshank, Grey Partridge, Merlin and Hen Harrier. Local people enjoy these birds and their habitat using the many footpaths throughout the site.

Ballidon limestone (Tarmac, Peak District National Park)

12. Ballidon is located within the Peak District National Park, approximately 10 km north of Ashbourne and 21 km south west of Matlock. The quarry first became operational in the 1950’s. The current site Biodiversity Action Plan (BAP) describes a five-year programme of ecological restoration and management works which will contribute to the long-term restoration extending to 2037. Being located within the Peak District National Park and adjacent to Ballidon Dale Site of Special Scientific Interest (SSSI), land-forming has had to screen the quarry from, and at the same time blend into, its surrounds. The restoration at Ballidon is specific to the Quarry, but the approved plan does aim to be sympathetic to the surrounding area in terms of landscape and flora. The site BAP aims to contribute to the Peak Park BAP targets.

Geological Society of London

16 February 2011

Written evidence submitted by the Natural History Museum (SIM 11)

Inquiry into Strategically Important Metals

Background and interests

1. The Natural History Museum (NHM) has a mission to maintain and develop its natural history collections to be used to promote the discovery, understanding, responsible use and enjoyment of the natural world.

2. The NHM has strong links to the mineral deposits research community in the UK through its association with the Mineral Deposits Studies Group (MDSG), the Mineralogical Society and the Geological Society, and its scientists have contributed to other submissions to the Committee from these groups.

3. The Department of Mineralogy at the NHM provides a national capability in the characterisation and research into naturally occurring minerals, rocks and ores. The Museum’s collections are de facto the national collection of specimens of minerals rocks and ores, containing more than 550 type specimens of the 4~4500 mineral species identified worldwide. These collections form the basis for active research programmes where there is a fundamental need to understand the natural geodiversity of minerals, how they form, how they break down and how metals are incorporated into them.

4. Research and curation scientists in the Department of Mineralogy are influential members of UK-based and international mineralogical forums; for example we have a representative on the management group of the internationally respected web-based resource Mindat, which now forms an authoritative reference database of natural mineral species and their worldwide provenance. World-class laboratories underpin the research and curation efforts at the Museum meaning it has the capability to fully characterise natural minerals, a unique combined facility in the UK.

5. The NHM is active with both research and consulting projects with the minerals industry worldwide and so provides advice on diverse issues related to mineral occurrence and methodologies of processing. The NHM works with other UK agencies, for example it has provided specialists to work on contract projects with the British Geological Survey, where in-house expertise was lacking.

6. The Centre for Russian and Central Eurasian Mineral Studies (CERCAMS) is embedded in the Department of Mineralogy and is a research network that covers the CIS (Russia, Central Asia), Mongolia and China; all key emerging suppliers of metals

to world markets. CERCAMS holds advanced knowledge on the mineral wealth of these regions and has an unparalleled collaborative network established with institutions in the region.

7. The NHM generates the world’s only comprehensive database on carbonatites which are the most important host-rocks for Niobium and Tantalum deposits as well as containing vast reserves of Rare Earth Elements (REE).

Question 1: Is there a global shortfall in the supply and availability of strategically important metals essential to the production of advanced technology in the UK?

8. Projections suggest that there may be shortfalls of supply of some commodities in the medium term as indicated by the EU ad-hoc working group which reviewed ‘Critical raw materials’ in 20101. However, it should be pointed out that in general terms limits to current mineral extraction are a function of the energy costs of extracting at a profit. Figure 1 shows a graphical representation of this, indicating that supplies of most metals are actually virtually limitless but there is a ‘mineralogical barrier’ to extraction defined by the inability to extract the metal feasibly below a certain concentration level.

Figure 1 – Graphic representation of distribution of elements on the planet. Red area shows the limit to current extraction levels (at high mineral grade). The yellow area indicates where the bulk of the planet’s resources of metal lie, at concentrations either uneconomic or unfeasible to extract, largely a result of energy costs (sourced from HCSS Report No. 02/1/10 Scarcity of Minerals2).

9. Shortfalls in supply are often due to industrial reliance on specific mineral commodities which provide the metal of interest to an existing established commercial process. In many cases a high specificity of the mineral commodity mined and traded

can result in either corporate or geographical monopolies of supply or in some case both. This is because often the rare mineral commodities are only economically concentrated in particular parts of the earths crust. A specific example would be the REE, which are essential for the manufacture of the magnets in such diverse products as computer disk-drives and new wind-turbines. 93% of REE supply is currently from China. A similar case exists for Niobium, essential to many electronic components, for which Brazil currently supplies 92% of world production.

10. We need to develop a better knowledge of the diversity of minerals containing the specific metal needed and their worldwide distribution. This knowledge would enable us to identify new locations for the potential supply of future metal needs. Characterised collections of naturally occurring mineral species such as those held at the NHM form important research resources for this type of initiative.

11. Industry responds to supply pressures with investigation of new supply streams, either by utilising substitute minerals from which the element is sourced or in some cases substituting another element (e.g. Palladium substituting for Platinum in vehicle catalytic converters). However, such work needs research which can be pursued in industry-academic partnerships. One fruitful area of research would be to seek new mineral sources for strategic metals which may be held in known but currently unexploited deposits (or waste materials). The key to unlocking these potential supplies is the development of alternative processing technologies that might successfully be employed on the new resource streams. An example of this is a project—hosted at the NHM—in which the application of new hydrometallurgical technologies to the processing of oxide Nickel ores (a technology pioneered by a UK- based Plc) is being investigated by our mineralogists. This work results in formerly uneconomic sources of Nickel, which are actually abundant in the eastern Mediterranean area of Europe, becoming attractive for future processing. Another good example is the NHM mineralogical work on the new Lithium mineral Jadarite, also carried out for a UK-based Plc. Lithium is currently sourced from the mineral spodumene which is mined in Canada and Australia but also from playa brines in South America. The recent identification of a potential new source of Lithium in Europe means that an alternative supply from a previously unknown source is possible, should the alternatives become unavailable. With more encouragement, more of this type of work could cover the full range of strategic metals, establishing a complete ‘geodiversity’ inventory of strategic metal mineral species that may form future extractable reserves, which might be mapped against diversity of supply, cost of recovery and other factors.

12. A vertically integrated approach to mineral deposit research is needed with linkages between geologists, metallurgists and engineers in order to be able develop new innovative processing techniques. This combined research of ‘geometallurgy’ could allow either the substitution of new mineral sources for a particular metal or alternatively have the effect of being able to move the ‘mineralogical barrier’ shown in

Figure 1 significantly to the left through novel, more energy efficient processing. Research council funding might be focused towards this area of applied mineral science. Current barriers too this could be the fact that this type of research bridges the funding briefs of NERC and EPSRC which may dissuade research projects in this field.

Question 2: How vulnerable is the UK to a potential decline or restriction in the supply of strategically important metals? What should the Government be doing to safeguard against this and to ensure supplies are produced ethically?

13. The UK is vulnerable to restriction of strategically important minerals. The UK currently produces none of the strategic metals and the secured sources within the EU yield only minor amounts of Antimony and Tungsten but no Niobium, Tantalum, REE or Platinum Group Elements (PGE). It is therefore imperative that UK institutions, like the NHM who have specialist knowledge and skills applicable to the development of secure resource streams play a role in research projects where such commodities are being evaluated.

14. A key problem in assessing the reserve and resource issues that face strategic metals is the current patchy level of knowledge about resources on a global scale. Whilst the ‘western’ economies are relatively transparent about their resources, key countries such as Russia and China have historically considered resource statistics as state secrets and consequently it is still even now difficult to ascertain accurate data for these territories (for example PGE supply was a state secret in Russia until 2005). The NHM’s CERCAMS group in collaboration with Russian other CIS state entities has developed a internationally recognised expertise in generating deposit and resource information for the CIS, China and Mongolia. It is apparent that commodity companies from Asian manufacturing economies of China, Korea and Japan are aggressively acquiring interests in both mineral deposits worldwide and taking large equity stakes in international resource companies, including UK-based companies (e.g. Chinalco 12% of Rio Tinto). The German government acknowledge this lack of market transparency in their review of strategic metal supply for German industry and announced in April 2010 that ‘it is important that we increase transparency in the resource markets’. In the last 5 years some countries have changed their investment and mining laws to protect resources that are seen as being of national economic and strategic importance by limiting international investment in key deposits (e.g. Russia’s Foreign Strategic Investment Law – 2008).

15. With regard to ethical supply, it is possible to provenance (‘fingerprint’) certain mineral commodities using information on their chemistries and associations. It may be possible to implement a “certificate of origin” scheme that could track minerals along the supply chain from mine to market. Industry-led efforts in this field include pilot schemes by the Electronics Industry Citizenship Coalition and the International Tin Research Institute. The Kimberley Process, set up in 2003, addresses the trade in

so-called blood diamonds and is the most high-profile of this type of initiative. The US has partially responded to ethical issues of mineral supply by recently introducing the Reform and Consumer Protection Act (July 2010), which requires any US-listed company to publicly disclose whether its products contain materials sourced from zones of conflict. The type of forensic mineralogy to track where minerals might be sourced from demands good analytical information from material, cross-referenced with well characterised and provenanced samples. The laboratories and national collections of the NHM can provide both the analyses and reference material for such an initiative.

16. New minerals can be substituted as new sources of supply, on example is the extraction of Nickel from lateritic ores which is set to overtake the amount of Nickel extracted from sulphide ores in the next 3 to 5 years3 . There is a need for more information about the mineral diversity (‘geodiversity’) of the strategic metals so that a better assessment can be made concerning their distribution and the location of future new resources. Again, characterised collections of these naturally occurring are needed for such assessments.

Question 3: How desirable, easy and cost-effective is it to recover and recycle metals from discarded products? How can this be encouraged? Where recycling currently takes place, what arrangements need to be in place to ensure it is done cost-effectively, safely and ethically?

17. The recycling of metals from discarded products is essential. However, another source of metals may be waste mineral products.

18. Waste mineral products in some cases can form a future resource. We therefore need an assessment of potential supply of strategic metals not only from recycled products but also from discarded mine waste. Waste may be in the form of unprocessed mine rock dumps or slimes produced during the processing of other commodities and may actually be an untapped resource of some of the strategic metals. Across the EU states and elsewhere such waste material may exist but needs careful characterisation to assess its suitability. A more careful inventory of waste materials should be made to assess suitability as new resources.

Question 4: Are there substitutes for those metals that are in decline in technological products manufactured in the UK? How can these substitutes be more widely applied?

19. As stated in point 16 above, an understanding of the full geodiversity of possible natural source materials (minerals) is needed to be able to assess our future commodity needs to enable UK industry to rapidly respond to future trends.

20. The application of substitute supplies needs buy-in from industry to change the currently traditional sources and therefore support for industry-academia research into these new processing streams and methods is therefore necessary.

Question 5: What opportunities are there to work internationally on the challenge of recovering, recycling and substituting strategically important metals?

21. Applied research into mineral deposits clearly aids the exploration for new resources. UK academic institutions have a strong track record in collaborative research projects with UK-based international mining companies at a range of levels. The UK government must ensure support for this research is strengthened from the current low base via focused funding for universities and public research in order to continue helping the development of new resource streams. Encouragement to create vertically integrated research which would look at metal sources from their discovery through to formation of a successful processing and waste management strategy is essential and we highlight the emerging research discipline of ‘geometallurgy’ which unites geologists, mineralogists, metallurgists and mineral processing engineers in the search for the efficient extraction of metals.

22. Waste streams from past mining and metal processing in the UK and elsewhere could potentially be substitute sources for some of the strategically important metals currently obtained elsewhere. One example identified by CERCAMS at the NHM is the extensive waste dumps from copper mining in Central Asia, a potential alternative source for PGEs and thus the development of better collaborative research links with countries where large industrial waste streams are known (e.g. CIS countries) may bring opportunity for UK research teams and industrial groups.

Conclusions

23. In conclusion, the UK should act swiftly to implement measures or make specific recommendations in order to mitigate some of the supply issues faced. Much of this can be done by encouraging closer research links between all parties involved in the location, extraction, processing and trading of metals. Specific research initiatives may be warranted in the field of ‘geometallurgy’ where the UK could make a greater contribution using our existing research centres of excellence, such as the NHM. The NHM is ready to help contribute towards these aims and would welcome the chance to discuss this further.

24. Underpinning the national research capability relating to the resource sector is essential to secure facilities and expertise to advise on strategic metal sources and supply. Focused government support for the mineral deposit research base in the UK public sector, including the NHM and in universities needs to be maintained and in some areas increased or national capability will be lost. Applied research, not close

enough to market to be directly supported by industry, has been poorly supported by NERC in recent years, largely as the research may bridge between research council remits. We urge there to be more attention paid to this. Research in this sector is critical both for the maintenance of capacity and also for tackling the challenges of efficient extraction of resources in an environmentally sustainable way, with less waste generation and more carbon neutral processing.

25. In line with other EU states (e.g. Germany and France), the UK government might consider installing a qualified advisory group (agency, commission, committee) bringing together the best expertise from, for example, the British Geological Survey, universities, the NHM, other research institutions, NERC and EPSRC together with experts from the UK-based minerals industry, commodity traders, metal processors and the end users in order to regularly monitor and advise on issues.

References: 1 Critical Raw Materials for the EU, Report of the ad-hoc Working Group on defining critical raw materials, European Commission, July 2010: http://ec.europa/enterprise/policies/raw- materials/documents/index_en.htm 2 Scarcity of Minerals: A strategic security issue, 2009: The Hague Centre for Strategic Studies: No. 02|01|10 3 The Past and the Future of Nickel Laterites: PDAC 2004 International Convention presentation: Dr. Ashok D. Dalvi; Dr. W. Gordon Bacon; Mr. Robert C. Osborne, Inco Limited

Department of Mineralogy Natural History Museum

17 December 2010

Written evidence submitted by Construction Materials Group, Society of Chemical Industry (SIM 12)

Inquiry into Strategically Important Metals

1. Is there a global shortfall in the supply and availability of strategically important metals essential to the production of advanced technology in the UK?

[1] Yes ‐and not just in metals. For example, the last remaining UK fluorite mine (Glebe, Derbyshire) has been closed by it new owners (INEOS) with the loss of 65 jobs. The asset is to be sold to a Mexican firm (Mexichem) by the end of 2010 (who will import the mineral from overseas) and will impose considerable costs in the acquisition of new processing equipment by their UK customers. Note that fluorite is an essential flux for metal refining and the principal pre‐cursor to production of hydrofluoric acid.

[2] In considering supply and availability, we must distinguish between primary and secondary production and between home and overseas sources. Our indigenous metals reserves, though once extensive, are now considerably depleted, being worked extensively from the dawn of the industrial revolution to the present. We are dependent on the import of metals from overseas. Over the last decade, our ability to refine metals in the UK has reduced markedly; seeing the closure of our last copper smelter (James Bridge) our last zinc Smelter (Britannia) our major aluminium refiner (Anglesey) and the withdrawal from the secondary lead business by Xstrata (formerly Britannia Refines Metals on the Kent coast). These changes leave the country increasingly dependent on overseas markets and technologies and severely limiting our ability to recycle the metals which we discard.

[3] As to the impact on “the production of advanced technology in the UK” we can only speculate about the impact of the loss of skills, facilities and knowledge to this country. In terms of technological development (at which we still excel) the availability of strategic metals has not yet had a major impact on our R&D capability. However, our demonstrable inability to develop world‐class research into profitable business is undoubtedly restricted by the lack of opportunity to develop R&D ideas with industrial sponsors, as strategically important businesses have been allowed to decline.

2. How vulnerable is the UK to a potential decline or restriction in the supply of strategically important metals? What should the Government be doing to safeguard against this and to ensure supplies are produced ethically?

[4] There are numerous examples of metals whose supply limits industrial growth. Indium for display technology; lithium for high energy density batteries; the rare earth elements terbium, lanthanum and neodymium, are all at the forefront of technological development and all are in short supply. There are two drivers to this. The ‘less common’ light metals, lithium and titanium are abundant in the earth, but

are difficult and energy‐intensive to refine. The UK is at the forefront of titanium refining R&D (see the FFC processi) and lithium is produced and recycled by Umicore in Belgium amongst others. On a recent visit to Umicore I was unsurprised to hear that the greatest restriction on the efficient recovery of lithium from batteries is that they are rarely recycled! Having paid a considerable sum for a mobile phone imparts a sense of value in its owner, which persists long after it has ceased to be used. Most of the redundant phones in the western world lie in a drawer! There is an obvious initiative the government could take to increase the supply of this metal – any incentive to recycle mobile phone and other batteries would offer huge savings over refining lithium from minerals such as spodumene. The UK does not have economic deposits of lithium, the bulk is mined in Bolivia, with Australia, Chile, Afghanistan and China holding considerable reserves.

[5] The issue of Rare earth Elements is much further from our control. The automobile industry uses tens of thousands of tons of rare earth elements each year, and advanced military technology depends on these elements also. Much of our "green" technology depend on them, including wind turbines, low‐ energy light bulbs and hybrid car batteries. Of the 17 REE elements known, China holds 97% of the reserves and has threatened to stop, or severely restrict their export, preferring to export them as high‐ value products. The problem is that at present, there is an insufficient quantity of these elements in circulation to make their recycling worthwhile.

3. How desirable, easy and cost‐effective is it to recover and recycle metals from discarded products? How can this be encouraged? Where recycling currently takes place, what arrangements need to be in place to ensure it is done cost‐effectively, safely and ethically?

[6] It is relatively easy to recover elements from products, but this comes with an energy penalty and often generates wastes which often have no practical use. Developments in recycling technologies have been supported in the UK through the Research Councils, the Knowledge Transfer Networks and Technology Strategy Board and their continued success should be safeguarded.

[7] To increase the recycling of metals generally, a strategic review of the efficiency with which industries and local authorities deal with their waste inventory in needed. This should be followed by compulsory sorting of all metal wastes from households and businesses by the consumer and collection by local authorities. It is indefensible in a modern society to throw any metals away.

[8] We need a national review of metallic wastes in the UK, quantifying the amounts and locations of each metal in the national waste inventory and then to identify routes to their recovery. Once we understand the nature of the problem, we will be in a position to address it. At present a large, but unknown quantity of metals are neither in use, nor in the recycling circuit. It would be in the nation’s interest to minimize this quantity though recycling incentives.

[9] You ask how recycling can be encouraged and this is effective by both carrot and stick. To impose fines on people discarding metal waste is one option as would be the provision of a VAT discount on new phones; available when trading in an old one. The safety of recycling is another issue. For example, the lead in a car battery has potentially great toxicological impact. Thankfully, it takes a very long time before it is adequately dissolved and this is often sufficient for its impact to be diluted and dispersed. By

and large, industrial safety is excellent in the UK and increased recycling of metals would seem to pose no new risks to those already accounted for.

[10] Lastly, the ethics of recycling are occasionally very poor indeed. We have all seen waste ground where the insulation has been burned from (often stolen) cables, prior to their sale as scrap copper. This localized and relatively small‐scale crime is very difficult to prevent. Similarly, the export by sea of huge quantities of metals has ethical implications in that their initial ‘reprocessing’ in India, China and the Philippines is often crude and environmentally damaging. In both cases, we have a legislative framework in place which, by and large, prevents ethically unsound practice in the UK, but once out of our control becomes very difficult to manage.

4. Are there substitutes for those metals that are in decline in technological products manufactured in the UK? How can these substitutes be more widely applied?

[11] Current technologies do not provide suitable alternatives to the rare earth elements, which are of increasing concern. As stated above the opportunities for their recycling are very limited at present. We do have the facility for recycling platinum group metals from exhaust catalysts through Johnson Matthey, but the business is dependent on global car sales. At present, it is not very attractive to them, but as the major PGM operators in the UK, they should be encouraged. Globally, Anglo American controls almost half of the world’s reserves of platinum group metals and is the dominant force in their primary extraction. Much has been said about recovery of PGM dust from road gulley waste and various proposals have been made to address this. Again, this is an area ripe for development. Research into alternative catalysts should be promoted vigorously, but no obvious replacements to PGM elements seem attractive at present.

5. What opportunities are there to work internationally on the challenge of recovering, recycling and substituting strategically important metals?

[12] The UK R&D community depends in part, on the strength of our government officials in effective lobbying in Europe. Through the European Technology Platforms, we have an opportunity to work with partners in Europe in shaping the political agenda for strategic materials R&D. We need to ensure our representatives are well‐versed in science and technology and are in an informed position to conduct these negotiations to this country’s long‐term advantage. There is no room for weakness here, as the German, Dutch and Scandinavian representatives seem especially able in this respect.

[13] Perhaps the greatest return for the taxpayer’s money would be to provide the TSB or KTNs with the resources necessary to find prospective partners and opportunities in Europe and to maximize the participation of the UK research community. This would require a small group of people to monitor both the ‘Official Journal’ and ‘Framework Programme’ literature and to disseminate this information in the UK. Moreover, involvement with the Directorates General and Technology Platforms will provide a valuable conduit for information transfer in both directions. The larger UK companies do this commercially and it would be an easy step for the government to take, involving little cost for potentially great rewards. In these times of both austerity and information overload, this might go some way to increasing our international collaboration, at least in Europe.

[14] In conclusion, Britain no longer meets its own needs in terms of metal extraction and its ability to recycle the metals it has used has declined considerably in recent years. Exporting our metals for recycling elsewhere comes at a cost to both the economy and environment. Moreover, it leaves us increasingly vulnerable to the fluctuations of the international metals markets and the political whim of monopoly supplier nations.

[15] Our greatest asset is in expertise across the entire supply chain, from exploration, mining, beneficiation and smelting, to novel technologies for recycling of secondary metals. Britain produces some of the most sought after graduates in these technologies and has generated a wealth of knowledge far greater than might be expected for our relatively small population. Our R&D assets in these critically important areas should be protected at all costs to ensure the materials security of the nation.

i G. Z. Chen, D. J. Fray, T. W. Farthing (2000). "Direct Electrochemical Reduction of Titanium Dioxide to Titanium in Molten Calcium Chloride". Nature 407 (6802): 361–4

Declaration of Interests: Mark Tyrer B.Sc. M.Sc. Ph.D. FGS FIMMM FMin.Soc.

Currently:

Independent Consultant in Geochemistry and Geomaterials

Visiting Professor, Coventry University Principal Research Fellow, University College, London Honorary Senior Research Fellow, Imperial College, London Project Manager, Mineral Industry Research Organisation

Chairman, Construction Materials Group, Society of Chemical Industry

Director: The Association of Consulting Scientists, London

Company Associate: Land & Minerals Consulting, Ltd. Bristol and Quarry Design Ltd. Bristol Company Associate: Quintessa Ltd. Henley‐on‐Thames, Oxfordshire

Editorial Board member ‐ Mineral Processing & Extractive Metallurgy Maney Publishing, London, UK

Committee member: Cementitious Materials Group, Institute of Materials, Minerals & Mining, London Committee member: Materials Chemistry Group, Institute of Materials, Minerals & Mining, London Committee member: Geochemistry Group, Geological Society Committee member: Applied Mineralogy Group, Mineralogical Society Committee member: Standard “B/516” British Standards Institute, London.

Dr. Mark Tyrer Chairman Construction Materials Group, Society of Chemical Industry

17 December 2010

Written evidence submitted by Research Councils UK (SIM 13)

INQUIRY INTO STRATEGICALLY IMPORTANT METALS

EXECUTIVE SUMMARY

• Much of the concern over physical exhaustion of geological reserves of strategically important metals is likely to be misplaced, though there are no grounds for complacency • Due to the combination of 100% dependence on imported supplies, a high concentration of production in relatively few countries and low substitutability and recycling rates, the UK is vulnerable to restrictions in supply of some metals • New technologies required to develop the Green Economy will create a new source of demand for some strategically important metals. To ensure such technologies contribute to the Green Economy, carbon emissions and other environmental impacts associated with mining and processing of strategically important metals should be minimised • Scientific research has a critical role to play in numerous areas including: o Understanding earth processes and properties that produce mineral deposits and developing new mineral exploration technology, both to expand existing reserves and identify new resources o Assessing the environmental implications of exploiting minerals important for the Green Economy, including whether extraction can be undertaken with a lower carbon footprint o Developing alternative or replacement materials for strategically important metals in products o Improving processes for recycling and reuse and doing more with less

INTRODUCTION 1. Research Councils UK (RCUK) is a strategic partnership set up to champion the research supported by the seven UK Research Councils. RCUK was established in 2002 to enable the Councils to work together more effectively to enhance the overall impact and effectiveness of their research, training and innovation activities, contributing to the delivery of the Government’s objectives for science and innovation. Further details are available at www.rcuk.ac.uk.

2. This evidence is submitted by RCUK on behalf of the Research Councils listed below and represents their independent views. It does not include or necessarily reflect the views of the Knowledge and Innovation Group in the Department for Business, Innovation and Skills. The submission is made on behalf of the following Councils: • Engineering and Physical Sciences Research Council (EPSRC) • Natural Environment Research Council (NERC) • Science and Technology Facilities Council (STFC)

3. NERC comments were provided by the British Geological Survey, NERC Swindon Office and Professor Louise Heathwaite, NERC Theme Leader Sustainable Use of Natural Resources (SUNR).

BACKGROUND 4. Recent studies in the EU, USA, Japan, UK and elsewhere have attempted to identify the most ‘critical’ metals and minerals1, 2, 3, 4 so called because of their increasing economic importance and high risk of supply shortage. Hitherto, global consumption of critical metals has been relatively small. 5. The NERC British Geological Survey (BGS) has monitored global metal production and trade for almost 100 years. This knowledge and experience, together with BGS' active participation in the recent EC study on defining critical raw materials1 leads us to suggest the following are considered the most 'critical' strategically important metals: antimony, beryllium, cobalt, gallium, germanium, indium, lithium, niobium, platinum group metals, rare earths, rhenium, tantalum, tungsten. 6. Consideration of future demand for these metals is important, a major source of which will be new technologies required to develop the green economy (see Annex 1 for examples of driving technologies for different metals). For example, demand for gallium in emerging technologies may increase by a factor of more than 20 between 2006 and 20301. For indium, germanium and neodymium, the factors are 8, 8 and 7, respectively, over the same period. This concern is the focus of a proposed £6M major research programme on ‘Mineral resources: security of supply in a changing environment’ led by the SUNR5 theme for NERC. The focus would be to understand formation processes of metals important to the green economy and the environmental implications of their extraction and whether this can be undertaken with a lower carbon footprint.

7. Industry will make choices to use specific materials for a particular application, device or product, based upon many factors – for example prior experience, availability, performance and cost. There is a strong role for materials science and engineering researchers to expand the options available to companies. The two areas where research has a critical role (often supported through EPSRC) are: • Replacement materials – developing alternative materials with the required characteristics and then demonstrating performance in use • Processes for recycling and reuse – in order to recover strategically important materials, reduce the need for primary extraction of materials or achieve other environmental benefit (e.g. energy reduction)

8. Though outside the scope of this Inquiry, there is concern over the shortage of Helium 3 and 4 used in neutron detectors such as the STFC ISIS facility and in MRI scanners in hospitals. This is a potential limitation for future research and clinical applications, particularly related to lung imaging. STFC scientists and engineers are actively developing alternative technologies to overcome the Helium 3 shortage.

1 European Commission (2010) Critical Raw Materials for the EU. Report of the ad-hoc working group on defining critical raw materials. http://ec.europa.eu/enterprise/policies/raw-materials/critical/index_en.htm 2 National Research Council (2008) Minerals, Critical Minerals and the US Economy. National Academies Press, Washington. 3 Ministry of Economy, Trade and Industry Japan (2008) Guidelines for securing national resources. http://www.meti.go.jp/english/press/data/pdf/080328Guidelines.pdf 4 Oakdene Hollins (2008) Material security for the UK economy. Report for DBIS (Technology Strategy Board) http://www.oakdenehollins.co.uk/pdf/material_security.pdf 5 http://www.nerc.ac.uk/research/themes/resources/ Question 1. Is there a global shortfall in the supply and availability of strategically important metals essential to the production of advanced technology in the UK? Physical availability of metals 9. Before considering UK supply, it is necessary to address the generic issue of physical availability of metals in the Earth's crust. The reality is that despite increasing metal production over the past 50 years, reserve levels have remained largely unchanged2. Indeed, recent reports suggest there is ample supply of rare earth metals in US deposits6,7. 10. Concerns regarding physical exhaustion of metals may be based on an over-simplistic view of the relationship between reserves and consumption (i.e. number of years supply remaining equals reserves divided by annual consumption). Metals of which we know the precise location, tonnage and which we can extract economically with existing technology - known as 'reserves' - are tiny in comparison to the total amount. Consumption and reserves change continually in response to a) scientific advances and b) market forces, as outlined below. a) Scientific advances - As our scientific understanding improves, we can replenish reserves from previously undiscovered resources. For example, mineral deposit types which were largely unknown 50 years ago (such as porphyry deposits which are now the principal sources of copper, molybdenum and rhenium) contribute significantly to global reserves. These were discovered and developed largely as a result of improved understanding of their formation. b) Market forces – Market forces influence reserve size as most metals occur in graded deposits: if prices rise, reserves will extend to include lower grade ore; if prices fall, reserves will contract to include only higher grade material.

11. Although physical exhaustion of primary metal supply is very unlikely, there are no grounds for complacency. Our knowledge of transport and concentration processes of many strategically important metals is very poor; consequently collaborative science is vital in predicting and finding deposits of strategically important metals. Through its 'Metals and Minerals for Environmental Technology' project, BGS carries out research in the UK and overseas, in conjunction with academia and industry, on the Earth processes and properties that produce mineral deposits, on novel resources for environmental technology (initially focusing on rare earths) and on new mineral exploration technology.

Environmental considerations

12. The environmental costs of mineral resource extraction, processing and use present a long term threat to UK supply. It is critically important to understand how to decarbonise the extraction process. Around 3% of total global energy demand is used solely to crush rock for mineral extraction; carbon emitted as a consequence represents a significant environmental limit to our resource use. Major research and innovation is required in order to break the current link between metal use and greenhouse gas emissions.

13. Current examples of low carbon resource extraction technology include in-situ leach mining (e.g. of uranium) and microbial bio-leaching (e.g. of copper and nickel) from extracted ores. As long as

6 The Principal Rare Earth Elements Deposits of the United States—A Summary of Domestic Deposits and a Global Perspective By Keith R. Long, Bradley S. Van Gosen, Nora K. Foley, and Daniel Cordier US Department of the Interior/ US Geological Survey Scientific Investigations Report 2010–5220 Nov 17 2010. 7 http://www.usgs.gov/newsroom/article.asp?ID=2642 the environmental impact can be minimised, such processes may significantly extend the resource base by allowing working of previously uneconomic ore types and grades. 14. The proposed NERC SUNR programme on ‘Mineral Resources’ (see paragraph 6) will (if funded), support research designed to minimise the carbon and environmental footprint of future use of mineral resources.

Resource distribution and geopolitics

15. Uneven resource distribution and geopolitics present threats to UK supply. Metal deposits are unevenly distributed across the globe and patterns of supply and demand shift continually. There is rapidly increasing demand from emerging economies such as Brazil, Russia, India and China.

16. The likelihood is that tensions over resources will increase over the next few years. The UK currently has a world-class capability to monitor and analyse global mineral production, consumption, trade and reserves8. This should be exercised in conjunction with other EU member states, the US and Japan in order to forecast future security of supply challenges.

Question 2. How vulnerable is the UK to a potential decline or restriction in the supply of strategically important metals? What should the Government be doing to safeguard against this and to ensure supplies are produced ethically?

UK imports & reliance

17. The table in Annex 2 shows data on imports of strategically important metals into the UK and, for comparison, into the EU 32. Note that both the UK and the EU are currently 100% dependant for supply of these metals, as such, the UK is vulnerable to decline or restriction in their supply. A major deficiency in these figures is that they do not show imports embodied in finished and semi-finished goods (such as cobalt and lithium contained in rechargeable batteries). To our knowledge no reliable statistical data exists on this and therefore it is difficult to quantitatively assess our overall vulnerability to decline or restriction.

18. There have been and will be many important technological developments which incorporate strategically important metals, for example: • The UK is a world leader in the manufacture of auto-catalysts based on platinum group metals imported from South Africa and Russia. Import levels and consequent vulnerabilities in the EU are even greater, and pose a significant risk to UK manufacturers and consumers who import vital components and finished goods from elsewhere in Europe. • There is an enormous projected growth in the demand for lithium for electric vehicle batteries, including Nissan’s plans to manufacture them in the UK. • The technology required to deliver the government’s plans to build a “green manufacturing” sector e.g. solar cells, depends on the availability of some strategically important metals

19. Research Council funding (via EPSRC) has facilitated the development of new materials and devices that rely on the inclusion of strategically important metals to deliver their desired properties. Advances have had large and varied impacts on our economy and society. These include key advances in the electronics industry, developments of new methods for energy generation,

8British Geological Survey (2010) Mineral Statistics home page: http://www.bgs.ac.uk/mineralsuk/statistics/home.html conversion and storage and significantly improved construction and engineering applications of newly created alloys.. 20. Shortages in the supply of Rare Earths and other strategically important materials would have a negative impact on the development of key UK-based large scientific facilities, such as Diamond and ISIS, operated by STFC and its partners, as well in other areas e.g. the development of the next generation of solar cells.

21. Some strategically important metals are derived as by-products (or coupled products) from the extraction of 'carrier metals' from ores in which they present in low concentrations. Examples include gallium (found in aluminium ore) and germanium (found in zinc ore). Production from these ore types is predominantly driven by demand for the carrier metal. This factor may constrain any possible increase in production of the coupled product should demand increase independently of the carrier metal.

Safeguarding supply

22. In general, we would subscribe to the recommendations made in the recent EU Critical Raw Materials report2 as a way forward in addressing potential decline or restriction in supply. Recommendations include better knowledge of indigenous resources, improved and consistent statistics on mass flows, proactive trade policy with regard to strategically important metals (this needs to be carried out at the EU level in order to achieve sufficient critical mass when negotiating with other powerful trading groups) and policies to encourage recycling, reuse and resource efficiency. It should be noted however, this report is primarily concerned with access to raw materials and not to understanding their life cycle or implications of use on the environment.

23. An emerging alternative approach to maintaining supply is collaboration or even vertical integration of mining companies and industrial consumers. This provides certainty for the metal producers and security of supply for manufacturers9.

24. In the past, stockpiling has been used by governments as a mechanism to reduce vulnerability. Whilst this approach has been seen as expensive and ineffective, some countries and private companies retain stockpiles. 25. The Research Councils engage with forums such as the Materials Knowledge Transfer Network (KTN), the Chemistry Innovation KTN and the Inter-Departmental Materials Coordination (IMC) group – a cross government group led by the Department of Business, Innovation and Skills and involving DEFRA, MoD, NPL, the Technology Strategy Board and other partners. These interactions allow us to feed in relevant information about current research and new developments and thus to develop a strategic approach to addressing the issue.

Ethical production

26. Wealth released as a result of minerals extraction is simultaneously an opportunity and a threat to the development prospects of a country. It is likely that the bulk of primary supply of strategically important metals will come from the developing world. Although mineral endowments should enable poorer countries to embark on a path to economic development, the evidence shows that resource- rich developing countries often move in the opposite direction toward poverty and instability.

9Ernst and Young (2010) Material risk: Access to technology minerals. http://www.ey.com/Publication/vwLUAssets/Material_risk:_access_to_tecnology_minerals,_Sept_2010/$FILE/Material%20risk_final .pdf 27. Inter-governmental agreements (such as the UK-led Extractive Industries Transparency Initiative) and the rise of corporate responsibility initiatives amongst the western mining sector (such as the Global Mining Initiative) have made major advances in improving the social and environmental impact of mining in the developing world. A serious challenge to this improvement is the rise of mining enterprises based in large emerging economies, but operating word-wide, which can adhere to different ethical standards to those established in developed economies.

28. Although formalised extraction by large enterprises is the familiar face of mining in the west, informal artisanal and small-scale mining (ASM) is a major extractive activity in the developing world. Of the listed critical metals, only tantalum-niobium (sometimes known as 'coltan') is produced in any quantity by ASM. The long-running civil war in the Congo is, in part, caused by conflict over control small-scale coltan mines. Millions of people worldwide are economically dependent on ASM and the social, environmental and economic issues associated with ASM pose a considerable developmental challenge. Aid donors (including the UK) must recognise and accept the importance of ASM as a livelihood for many poor people and work with governments and NGOs in developing countries to improve the social and environmental performance of this sector.

Question 3. How desirable, easy and cost-effective is it to recover and recycle metals from discarded products? How can this be encouraged? Where recycling currently takes place, what arrangements need to be in place to ensure it is done cost-effectively, safely and ethically?

29. Recycling, substitution and resource efficiency are hugely important in meeting the challenge of burgeoning demand and should be the focus of future efforts towards the sustainable use of natural resources. 30. Research councils are investing in research looking at the long-term sustainable use of materials:

• NERC are proposing a major £15m initiative on Resource Recovery from Waste led by the SUNR and the Environment, Pollution and Human Health10 science themes, and involving other Research Councils.

• As part of the Sustainable Urban Environment programme EPSRC funded a consortium led by the University of Southampton to investigate Strategies and Technologies for Sustainable Urban Waste Management11. This research looked to improve our understanding of waste treatment and material/energy recovery and our understanding of resource and energy flows through and within urban environments.

• The EPSRC Centre for Innovative Manufacturing in Liquid Metal Engineering12 at Brunel University is investigating more cost-effective and sustainable processes for metal engineering. If successful this research will dramatically reduce the energy consumption, carbon footprint and overall environmental impact of the metal-casting industry. Long term the knowledge gained from this funding could be applied to strategically important metals.

• EPSRC plans a major focus within its next Delivery Plan on sustainable manufacturing. This will address a range of sustainability challenges, including energy and resource efficient manufacturing, materials reprocessing and sustainable design approaches.

10 http://www.nerc.ac.uk/research/themes/health/ 11 http://gow.epsrc.ac.uk/ViewGrant.aspx?GrantRef=GR/S79626/01 12 http://gow.epsrc.ac.uk/ViewGrant.aspx?GrantRef=EP/H026177/1 Limits to recycled supply 31. In general, the free market has so far been ineffective in encouraging recycling and resource efficiency. Policy and related economic instruments have proved more effective. For example, the Aggregates Levy has contributed significantly to the UK’s high level of aggregates (i.e. crushed stone, sand and gravel) recycling (second highest in Europe)13.

32. For the foreseeable future, the vast bulk of our requirements for strategically important metals will have to be sourced from primary resources within the crust. The upper limit on what is available for recycling is determined by what comes back from society; the ceiling on this is what we consumed 40 to 60 years ago. By way of illustration, global consumption of copper in 1970 was approximately 8 million tonnes per annum. Five million tonnes was from mining, with 3 million tonnes from recycling. In 2008 global copper consumption was about 24 million tonnes, of which 8 million tonnes are derived from recycling, with the remaining 16 million tonnes from primary production. 33. For most other metals recycling provides only 10-20% of demand, although work by UNEP7 and research carried out as part of the recent European Raw Materials Initiative2 suggests that recycling rates for elements such as Gallium, Indium, Tantalum and Rare Earths are currently less than 1%. Even if recycling rates for these materials were much higher, we must recognise that the strategically important metal 'resource' currently residing in the anthropogenic environment is very small compared to that needed to meet predicted demand from manufacturers of electric vehicles, wind generators, solar panels and digital devices.

34. Assessing the further potential contribution of recycling to meeting demand within the UK is hampered by lack of figures on imports of strategically important metals contained in finished and semi-finished goods (see paragraph 17). This makes it difficult to quantify the amount of strategically important metals residing in society which may become available as a 'resource' for recycling.

Question 4. Are there substitutes for those metals that are in decline in technological products manufactured in the UK? How can these substitutes be more widely applied?

35. When developing new materials and devices researchers need to consider: • If strategically important metals are essential to provide the required properties • If there are alternative materials that will display the same properties • What the minimum level of the required element is that will allow the same properties to be exhibited • What the environmental implications of metal use are and how this will change in the future; whether environmental constraints might limit future use of minerals • The future supply of materials and whether developing a new material or device with significant quantities of strategically important metals is viable • The end of life and how to recapture, reuse or recycle strategically important metals

36. These thought processes are already evident in projects across the RCUK portfolio. Much of this research is carried out in partnership with manufacturers, material users and waste management organisations to tackle these challenges.

13 Mineral Products Association (2009) Sustainable development report http://www.mineralproducts.org/documents/MPA_SD_Report_2009.pdf

37. EPSRC is currently funding research at the Universities of Oxford, Liverpool and Salford14 to develop new advanced alloys for use in nuclear fission and fusion applications. The researchers have considered the range of elements available to them taking into account the properties required, including low activity rates from the alloys used. This decision making process has ruled out some strategically important metals in part due to their low natural abundance.

38. In the area of catalysis, EPSRC funded researchers at the University of Bath15 are looking at ways of developing catalysts based on group II elements. These would be more environmentally benign and place less demand on the world’s strategically important resources.

39. However, it should be acknowledged that in many instances substitution is not a viable option thus the way forward is appropriate life cycle thinking combined with research stimulus to ensure the environmental costs – and in particular the carbon costs – are minimised.

Question 5. What opportunities are there to work internationally on the challenge of recovering, recycling and substituting strategically important metals?

40. EPSRC and its researchers are engaging with this issue on an international level. One recent example is from a UK-Japan Symposium on Green Manufacturing and Eco-innovation16 in June 2010, which discussed the future growth area of “urban mining”17 - how we can treat manufacturing products accumulated as waste as a key resource for the future. EPSRC is also supporting an expert visit to Japan in January 2011 on “sustainable manufacturing” led by Professor Mike Gregory of the Institute for Manufacturing, University of Cambridge.

41. NERC are proposing leading a major research programme on Resource Recovery from Waste (see paragraph 30).

42. The Research Councils put forward key members of the academic community to participate in international committees with a focus on materials. Professor Neil Alford from Imperial College London sits on the European Materials Advisory Panel (MatSEEC). This is an independent science- based expert committee which provides a forum to discuss challenges at an international level and develops Forward Look reports and roadmaps for the different fields of materials science. MatSEEC could be an important future route for international engagement on issues around strategically important metals.

43. A new EC Communication on raw materials will be published in late January 2011. It is anticipated that this will lead to significant research opportunities in this field as part of FP7/ FP8.

14http://gow.epsrc.ac.uk/ViewPerson.aspx?PersonId=13417 15http://gow.epsrc.ac.uk/ViewGrant.aspx?GrantRef=EP/E03117X/1 16http://www.raeng.org.uk/international/activities/UK_Japan_Symposium_Green_Manufacturing_Eco_innovation.htm 17http://www.raeng.org.uk/international/activities/pdf/UK_Japan_Symposium_Green_Manufacturing_Eco_innovation/Kohmei_Halad a.pdf Annex 1

Strategically important metals and their driving emerging technologies

Raw material Emerging technologies Antimony Micro capacitors Cobalt Lithium-ion batteries, synthetic fuels Thin layer photovoltaics, Integrated Circuits, Gallium White LED Germanium Fibre optic cable, Infrared optical technologies Indium Displays, thin layer photovoltaics Niobium Micro capacitors, ferroalloys Platinum Fuel cells, catalysts Tantalum Micro capacitors, medical technology Titanium Seawater desalination, implants

Nb Table adapted from Table 5, page 43 of the Critical raw materials for the EU report1.

Annex 2

Imports of critical metals into the UK and the EU 32 in 200818

EU32 total Commodity UK imports imports £ thousand Tonnes Tonnes

Antimony 7,244 2,552 102,171

Beryllium 2,593 39 n/a

Cobalt 145,117 5,533 91,137

Gallium n/a n/a n/a

Germanium 400 1 n/a

Indium n/a n/a n/a

Lithium 3,568 1,002 33,211

Niobium 6,975 154 154

Platinum Group Metals 1,517,602 1,485 15,566

Rare Earths 10,669 2,508 45,428 Included with Rhenium Niobium n/a

Tantalum 8,443 161 885

Tungsten 47,815 3,026 21,874

Note: The above table was provided by BGS. BGS is a global leader in the compilation and publication of annual data18 on production and trade of metals and mineral commodities for UK, EU and the world. It has carried out this function since 1913. It also provides analysis and advice on global minerals issues. This includes publication of commodity profiles on a range of strategically important metals including rare earths19, platinum20 and cobalt21

Research Councils UK (RCUK)

17 December 2010

.

18 Source: BGS UK Minerals Yearbook 2009, BGS European Mineral Statistics 2003-2008, BGS World Mineral Production 2004- 2008 (see http://www.bgs.ac.uk/mineralsuk/statistics/home.html). 19 BGS (2010) Rare Earth Elements Mineral Commodity Profile (see http://www.bgs.ac.uk/downloads/start.cfm?id=1638) 20 BGS (2009) Platinum Group Metals Commodity Profile (see http://www.bgs.ac.uk/downloads/start.cfm?id=1401) 21 BGS (2008) Cobalt Mineral Commodity Profile (see http://www.bgs.ac.uk/downloads/start.cfm?id=1400) Written evidence submitted by the British Metals Recycling Association (SIM 14)

Inquiry into strategically important metals

Introduction

1. The British Metals Recycling Association (BMRA) is the trade association for ferrous and non-ferrous metal recycling companies throughout the UK and represents some 300 businesses from multi-national companies to small family- owned enterprises, which between them handle over 95% of the metal recycled in the UK. This £4-5 billion industry processes over 15 million tonnes of metal annually into valuable secondary raw material for metals manufacturing both here in the UK and in a wide variety of export markets.

2. We welcome the Committee’s inquiry examining the importance of strategically important metals. This is an area that has attracted increasing attention over the past twelve months and due consideration must be given to what remedies, if any, are required. The BMRA strongly believes that care must be taken over which metals are defined as strategically important and, particularly, that the definition is not extended to metals that are not rare but whose markets are volatile. Moreover, besides being a well regulated low carbon industry, the value of the materials handled by metals recyclers mean that operators observe the highest environmental and public health standards.

Question 1: Is there a global shortfall in the supply and availability of strategically important metals essential to the production of advanced technology in the UK?

3. The widespread use of the listed metals in consumer and industrial products is a relatively recent phenomenon and therefore there is not a significant volume recovered through the Waste Electrical and Electronic Equipment (WEEE) recycling market at this time, although these opportunities will increase as equipment comes to the end of its useful life.

4. Our understanding of the primary sources of most of those metals described as strategically important is that these are plentiful although the extraction process may have a very high cost attached to it or the deposit concentrations are very low, making extraction at the prevailing price uneconomic. We have no evidence that the metals listed are intrinsically “scarce” only that the availability of them (in the medium term) will be determined by the price that the market is prepared to pay for them. In other words, the market for these metals will behave in exactly the same way as all other metal or commodity markets.

5. We would also the ask the Committee to resist requests from some interested parties to broaden the list of “strategically important metals” to include metals that are in no sense “rare” but whose markets are volatile. Question 2: How vulnerable is the UK to a potential decline or restriction in the supply of strategically important metals? What should the Government be doing to safeguard against this and to ensure supplies are produced ethically?

6. UK manufacturers that employ metals that are subject to market volatility in their manufacturing processes need to secure their sources of supply by using the variety of market mechanisms that are readily deployed in these situations, such as hedging, forward purchase or stockpiling. Historically manufacturers have always looked at opportunities for substitution in order to avoid over reliance on a single material or source of supply.

7. There is a real danger that any intervention by a single government on behalf of a manufacturer or processor will disrupt and distort the market in that commodity. Naturally the manufacturer wishes to secure a source of supply at the lowest possible price but that should not be the basis for a market distortion. The UK should resist some of the narrower interests present in Europe at this time who would seek to restrict the export of valuable recycled metals in order to artificially deflate the price of this material to European manufacturers, who in turn wish to export the goods.

8. This pressure to restrain free international trade in secondary raw materials will have wide ranging consequences for the UK – not only in undermining the position of UK metals recyclers as Europe’s leading exports of recycled metal but also in encouraging protectionist behaviour more broadly.

Question 3: How desirable, easy and cost-effective is it to recover and recycle metals from discarded products? How can this be encouraged? Where recycling currently takes place, what arrangements need to be in place to ensure it is done cost-effectively, safely and ethically?

9. It is highly desirable that we maximise the recycling and recovery of metals from all end-of-life products for the benefit of the environment and the economy. The recycling of metals is generally cost effective and it is notable that BMRA members buy every ton of “waste” metal that they process, unlike any other part of the waste industry.

10. A number of mechanisms are being employed to encourage an increase in recycling and recovery rates for such materials as packaging, WEEE and end-of-life vehicles (ELV) with considerable success. Notably the European target for the recovery of ELVs is currently 85% and rising to 95% in 2015. The UK is on target to achieve its increased ELV targets.

11. WEEE recovery rates are much lower and are largely determined by the effectiveness of municipal collection rates, but of the WEEE available to UK recyclers around 90% is recovered in some of the most sophisticated WEEE recycling facilities in the world operating to the very highest ethical and environmental standards.

12. BMRA would be pleased to host a visit by members of the Select Committee to UK ELV and WEEE recycling facilities Question 4: Are there substitutes for those metals that are in decline in technological products manufactured in the UK? How can these substitutes be more widely applied?

13. No comment

Question 5: What opportunities are there to work internationally on the challenge of recovering, recycling and substituting strategically important metals?

14. The processes involved in recycling and recovery of strategically important metals are already well established although the market is limited at present (See Para 2) and will be deployed by a relatively small number of multi-national companies who specialise in the mechanical separation of metals and then their thermo-chemical recovery. The market is truly international and highly competitive. On this basis we do not anticipate any great demand for collaborative working.

British Metals Recycling Association

December 2010

Written evidence submitted by the British Standards Institution (BSI) (SIM 15)

Inquiry into Strategically Important Metals

As the UK’s National Standards Body, BSI welcomes this opportunity to comment on this inquiry.

BSI is the UK's National Standards Body (NSB) and was the world's first. It represents UK economic and social interests across all of the European and international standards organizations and through the development of business information solutions for British organizations of all sizes and sectors. BSI works with manufacturing and service industries, businesses, governments and consumers to facilitate the production of British, European and international standards.

Much of the market knowledge and expertise BSI has resides in its committee structure. BSI has a large number of committees of experts representing a broad range of stakeholders, and this promotes the development of consensus views regarding standardisation where this is deemed important.

1. Is there a global shortfall in the supply and availability of strategically important metals essential to the production of advanced technology in the UK?

1.1. BSI has no particular expertise in analysing or establishing the likelihood of any particular materials or resources becoming unavailable. BSI does, however, publish a great deal of standards that help organisations adopting them run their operations in a way that is truly sustainable based on the consideration of all relevant environmental, social and economic factors. A more detailed explanation of the tools that exist is available on the BSI website: 1.1.1. http://shop.bsigroup.com/en/Browse-by-Subject/Sustainability/ 1.2. These tools, and the development of new tools, form the basis of BSI standards- making activity in this area, and it is the adoption of these that will contribute to efforts to ensure the UK’s future wealth-making activities are not compromised by events unforeseen environmental, social and political occurrences that put the production of advanced technology at risk.

2. How vulnerable is the UK to a potential decline or restriction in the supply of strategically important metals? What should the Government be doing to safeguard against this and to ensure supplies are produced ethically?

2.1. Strategically important metals are no different to any other natural resource in that they all need to be used in a sustainable manner. Sustainable development is defined by the British Standard BS 8900:2006 Guidance for managing sustainable development as “an enduring, balanced approach to economic activity, environmental responsibility and social progress”. This standard guides organizations towards effective management of their impact on society and the environment, along the route to enhanced organizational performance and success. 2.2. For many organisations, such as the mining and manufacturing industries, the consideration of sustainable materials usage is fundamental to ensuring they operate in a genuinely sustainable manner. With this in mind, BSI is developing another standard that applies the concepts developed in BS 8900 to the use of materials. This standard has the title BS 8905 Framework for the assessment of the sustainable use of materials and is due to be published in mid-2011. It will provide a framework for the consideration of environmental, social and economic issues in the sustainable uses of materials. The framework can be applied to all parts of the supply chain, including the source of the material, the use of the material throughout the use phase of a product and the treatment of the material at the end of the product’s useful life. 2.3. The Standard is intended to support decisions about the sustainable use of any type of material, and the adoption and implementation of both this and BS 8900 should be encouraged by the Government to safeguard against the decline or restriction in the supply of strategically important metals in a way that is deemed ethical.

3. How desirable, easy and cost-effective is it to recover and recycle metals from discarded products? How can this be encouraged? Where recycling currently takes place, what arrangements need to be in place to ensure it is done cost- effectively, safely and ethically? 3.1. The recovery and recycling of metals from discarded products should only take place when it has been established that incorporating the metals in the products, and recovering and recycling them at the end-of-life stage is the most sustainable option available. Other options may include using other materials, or adopting other end-of- life options. 3.2. To make this judgement requires a coherent full lifecycle approach encompassing all relevant environmental, social and economic factors. This approach will be articulated in BS 8905 and adoption of these principles will enable sustainable practices to be put into place regarding the use of the metals and their subsequent recovery. 3.3. In relation to other end-of-life options, BSI is currently developing a series of standards for designers and design engineers, BS 8887, Design for manufacture, assembly, disassembly and end-of-life processing. These standards aim to give designers recommendations on how best to incorporate into their design documentation, guidance on the ultimate reuse, recovery, recycling and disposal of the components and materials used. A number of specific end-of-life processes have already been covered in the BS 8887 series. The series could be expanded to cover the selection and recovery of materials. A list of the BS 8887 standards currently published and/or in development is as follows: 3.4. BS 8887-1, Design for manufacture, assembly, disassembly and end-of-life processing – Part 1: General concepts, process and requirements; 3.5. BS 8887-2, Design for manufacture, assembly, disassembly and end-of-life processing – Part 2: Terms and definitions; 3.6. BS 8887-220: Design for manufacture, assembly, disassembly and end-of-life processing – Part 220: The process of remanufacture – specification; 3.7. BS 8887-240, Design for manufacture, assembly, disassembly and end-of-life processing – Part 240: Reconditioning.

4. Are there substitutes for those metals that are in decline in technological products manufactured in the UK? How can these substitutes be more widely applied? 4.1. Substitution can only take place when an individual engineer in full possession of the relevant facts relating to the product being developed is able to make a decision based on the both the performance and sustainability of the candidate materials. To be able to do this the engineer will need access to a wide range of complex engineering data relating to performance and sustainability. Such information is currently difficult to access due to the lack of agreement regarding the categories of information that need to be accessed across different geographical regions and materials classes and in different industries. In addition, the electronic file formats these data are stored in are often proprietary and software platform dependent, meaning long term archiving is difficult due to the rapid obsolescence of the platforms themselves. As a result these data are not easily accessed by the engineers making these judgements. 4.2. The global supply chains are very complex, and a lot of valuable information regarding the sustainability and performance of particular materials and resources is lost, because a particular participant in the chain only has knowledge of direct inputs and outputs. There are efforts in place to create repositories for data, such as the EU Life Cycle Database: 4.3. http://lca.jrc.ec.europa.eu/lcainfohub/datasetArea.vm 4.4. This presents industry-derived data on specific materials using an averaging process. Reliance on these data, however, means that is not possible for a participant to gain competitive advantage by being better than average. To do better than average requires the originators of the data to preserve, archive and make it available in a way that is not currently done. There are a great deal of internationally- developed product data standards developed under ISO/TC 184/SC4 Industrial Data that could be applied to this problem and would enable users to generate, retain, archive, and make accessible all relevant data in a way that is secure and does not compromise intellectual property. A summary of these standards is as follows: 4.5. ISO 8000, Data quality 4.6. ISO 10303, Industrial automation systems and integration — Product data representation and exchange, informally known as Standard for the Exchange of Product Model Data (STEP) 4.7. ISO 13584, Industrial automation systems and integration — Parts library (PLIB) 4.8. ISO 15926, Industrial automation systems and integration — Integration of life-cycle data for process plants including oil and gas production facilities. 4.9. ISO 18629, Industrial automation systems and integration — Process specification language (PSL) 4.10. These standards could be adapted in such a way that overcomes the problems in identifying and accessing important and complex engineering data. As a result, participants would be able to access all suitable relevant information regarding the attributes of a material, and make better choices in relation to its sustainability.

5. What opportunities are there to work internationally on the challenge of recovering, recycling and substituting strategically important metals?

5.1. The marketplace for raw materials, and goods and services using materials, is an international one, and many company, organisation and supply chain boundaries transcend national boundaries. Therefore, it is essential that the foundations upon which co-operation and methods are based are international in nature. As mentioned earlier, many of these methods will be transmitted through the medium of published formal standards. The agreed good practice that is contained within BS 8900 and BS 8905 will be of the highest value if it can be translated into internationally agreed standards at the global and/or European level. BSI, as the UK National Standards Body (NSB) has formal links with the International Standards Organisation (ISO) and the European standards making Body, CEN. Therefore, BSI is in the best position to ensure good practice developed in the UK is adopted more broadly and can also promote the UK as a pioneer in the development of solutions regarding the sustainable use of materials. 5.2. In addition, the UK is a leading participant in the development of standards developed by ISO/TC 184/SC4 Industrial Data, and is in a position to lead on developments where there is an opportunity to use standards to enable access to high quality and useful data.

BSI Background

1. BSI is the UK’s National Standards Body, incorporated by Royal Charter and responsible independently for preparing British Standards and related publications. BSI has 107 years of experience in serving the interest of a wide range of stakeholders including government, business and society.

2. BSI presents the UK view on standards in Europe (to CEN and CENELEC) and internationally (to ISO and IEC). BSI has a globally recognized reputation for independence, integrity and innovation ensuring standards are useful, relevant and authoritative.

3. A BSI (as well as CEN/CENELEC, ISO/IEC) standard is a document defining best practice, established by consensus. Each standard is kept current through a process of maintenance and reviewed whereby it is updated, revised or withdrawn as necessary.

4. Standards are designed to set out clear and unambiguous provisions and objectives. Although standards are voluntary and separate from legal and regulatory systems, they can be used to support or complement legislation.

5. Standards are developed when there is a defined market need through consultation with stakeholders and a rigorous development process. National committee members represent their communities in order to develop standards and related documents by consensus. They include representatives from a range of bodies, including government, business, consumers, academic institutions, social interests, regulators and trade unions.

British Standards Institution

17 December 2010

Written evidence submitted by The Cobalt Development Institute (SIM 16)

Strategically Important Metals

1. Is there a global shortfall in the supply and availability of strategically important metals essential to the production of advanced technology in the UK? CDI Comment: With regard to cobalt only, the industry does not see this as an issue. The global production of cobalt has consistently increased for the past 20-years and more recently several new projects have come on stream or are about to come on stream, for example FreeportMcMorans’s Tenke Fungurume project in DRC and Sherritt International’s Ambatovy project in Madagascar. The cobalt market is well supplied with refined and raw material for the foreseeable future. In fact a recent report from CRU Strategies suggests that we are likely entering a phase of oversupply of cobalt for the next five years. The USGS estimates that global cobalt reserves are over 7million tonnes and in the longer term there is also the possibility of mining deep sea mineralised nodules where the resource has been calculated to be around 1billion tonnes. Nautilus Mining are just embarking upon the first project of this type and so this source of cobalt (and many other minerals) could become reality on the longer term.

2. How vulnerable is the UK to a potential decline or restriction in the supply of strategically important metals? What should the Government be doing to safeguard against this and to ensure supplies are produced ethically? CDI Comment: The UK is an important user of cobalt and it affects a broad range of industries from superalloys (aerospace and land based gas turbines; hard wearing castings in renewable energy applications), catalysts (clean fuel technology and removal of harmful gases such as NOx), digital storage (essential in computer processing), industrial cutting tools (high speed steels and hard metals), driers in paints and pigments, rechargeable batteries (mainly Li-ion systems), high strength permanent magnets and many other applications. Cobalt is very much a technology enabling metal and important in achieving the stated ambitions of the Government’s ‘green’ agenda. To safeguard the UK’s important global position in cobalt the UK could consider creating a ‘Minister for Metals’ and should facilitate and encourage good political relations with important supplier countries as this would facilitate access to raw materials in third countries and should allow ethical issues to be more robustly addressed. Also it is considered appropriate to ensure that regulatory matters, such as REACH, are applied in a proportional and sustainable way. Such measures would ensure the best chance for the UK to enjoy uninterrupted supply with a sustainable and valuable future.

3. How desirable, easy and cost-effective is it to recover and recycle metals from discarded products? How can this be encouraged? Where recycling currently takes place, what arrangements need to be in place to ensure it is done cost-effectively, safely and ethically? CDI Comment: Much is already being done in this respect and liaison with bodies such as EUROMETAUX would most helpful in obtaining an industry perspective as recycling is an important aspect of sustainability. Resource efficiency is key for a sustainable future and the CDI believes it is important to facilitate the production and import of cobalt as well encouraging recycling. Knowledge of the sector and effective supply chain management are key here.

4. Are there substitutes for those metals that are in decline in technological products manufactured in the UK? How can these substitutes be more widely applied? CDI Comment: It is notoriously difficult to substitute cobalt without suffering serious reductions in efficiency and or performance. In the catalyst sector this is particularly apparent as well as for high performance alloys and in other technology enabling processes. If substitution provided enhanced characteristics or better economy then industry would automatically do this. With cobalt it is not appropriate just to talk about substitution as a means to an end as this could cause serious economic damage to the sector and at the same time cause a reduction is efficiency and effectiveness in certain important processes and applications.

5. What opportunities are there to work internationally on the challenge of recovering, recycling and substituting strategically important metals? CDI Comment: The UK should work to promote good governance, capacity-building and transparency in relation to the extractive industries in developing countries and promoting sustainable exploration and extraction within and outside the UK and EU. The CDI believes that closer co- operation with the African region in general – and the DRC in particular – is needed to ensure that access to essential raw materials by UK companies is facilitated and safeguarded. The EU currently has a Raw Materials Initiative underway which is examining this question. The issues relating to raw materials is complicated and the CDI does not believe that substitution should be an automatic response to perceived criticality of raw materials, rather it is recommended to look at methods which improve and safeguard raw material supply for UK industry.

The Cobalt Development Institute

17 December 2010

Written evidence submitted by The Royal Society of Chemistry (RSC) (SIM 17)

Strategically Important Metals

1. The Royal Society of Chemistry (RSC) welcomes the opportunity to respond to the House of Commons Science and Technology Select Committee’s consultation on strategically important metals (SIMs).

2. The RSC is the largest organisation in Europe for advancing the chemical sciences. Supported by a network of 46,000 members worldwide and an internationally acclaimed publishing business, its activities span education and training, conferences and science policy, and the promotion of the chemical sciences to the public.

3. This document represents the views of the RSC. The RSC has a duty under its Royal Charter "to serve the public interest" by acting in an independent advisory capacity, and it is in this spirit that this submission is made.

Is there a global shortfall in the supply and availability of strategically important metals essential to the production of advanced technology in the UK?

4. While this document addresses the SIMs highlighted by the committee, the Government’s latest procurement policy should expand to include other strategically important elements of the periodic table, such as phosphorus and helium.

5. The total stock of metal-containing minerals in the Earth’s crust is finite, but it is also extremely large. A ‘reserve’ is the stock of metal for which the location and tonnage is known and which can be extracted economically using existing technology. Reserves typically represent a small fraction of the total amount in the Earth’s crust. Current concern regarding access to SIMs is partly based on published reserves – which, in turn, is based on best estimates of the accessible deposits – together with the rate at which they are being consumed and the threat of reduced supply. Lithium reserves, for example, are estimated to be depleted in 45 years, indium 20 years and platinum 42 years.1

6. While there are further sources of metals than are suggested by these figures, the sources are neither evenly distributed nor, in many cases, easily accessible. For example, many metals are dissolved in the oceans2 and, as yet, economically viable extraction technology is not currently available, though lithium may be accessible from oceans using main group metal co-ordination chemistry.3

7. The OneGeology portal4 is a major international initiative that brings together information on mineral deposits. This is a useful assessment of the mineral

1 ‘Is this the start of the element wars’, New Scientist, 27 September 2010, (see Appendix Two for relevant diagram), http://www.newscientist.com/blogs/shortsharpscience/2010/09/is-this-the-start-of-the-eleme.html. 2 World Gold Council website, http://www.gold.org/world_of_gold/story_of_gold/numbers_and_facts/ 3 ‘Lithium Occurrence’, Institute of Ocean Energy, Saga University, Japan, http://www.ioes.saga-u.ac.jp/ioes- study/li/lithium/occurence.html 4 OneGeology, http://www.onegeology.org/ deposits present within the Earth's crust that may be exploited as future reserves. Over the longer term, it is scientific and technological advances in understanding the chemistry of ore deposit formation that will provide the necessary facility to locate and extract metals. For example, a significant proportion of global uranium reserves are located in a single deposit in Australia that remained undiscovered till 30 years ago.

8. The reality is that despite increasing metal production over the past 50 years, reserve levels have remained largely unchanged5. Indeed, recent reports suggest there is ample supply of rare earth metals in US deposits.6,7 Consumption and reserves are continually changing in response to movements in markets and scientific advances. Reserve levels depend on the scientific knowledge used to locate mineral deposits and on the price of the target mineral. As scientific understanding improves, reserves become replenished from previously undiscovered resources.

9. Most metals occur in graded deposits; if prices rise, then reserves will extend to include lower grade ore; if prices fall, then reserves will contract to include only higher grade material. The reasons for high costs relate to low concentrations and to chemical similarity between some elements, which makes separation difficult. The lower grade ores will incur a higher cost to obtain the groups of metals, although the separation costs should remain consistent. Declining production is generally driven by falling demand and prices, not by scarcity.

10. Metal deposits are unevenly distributed across the globe, and patterns of supply and demand are continually shifting. The advancement of technologies that rely on these metals, both within the UK and globally, are putting pressure on reserves and supply. It is likely that this will lead to tighter controls on export by the countries that currently control reserves.8 This is of particular concern for the UK, as only 5% of the known worldwide metal reserves are found in Europe.9

11. A key strategy for the guarantee of future global supplies will be investment in new, greener technologies to find and extract these metals from alternative sources. The extraction and processing of metal is energy-intensive and the carbon emitted as a consequence may represent a significant environmental limit to our resource use. We can expect to see major research and innovation directed towards breaking the current link between metal use and greenhouse gas emissions. Examples of where low carbon technology may be headed include in situ leach mining (uranium) and microbial bio-leaching of metals from extracted ores (copper and nickel).

12. A robust strategy to manage import of metals to the UK is important and urgently required. The British Geological Survey monitors the import and export of metals within the UK and works alongside similar external organisations that monitor these resources globally. Additional monitoring to track the distribution, use and

5 European Commission (2010) Critical Raw Materials for the EU. Report of the ad-hoc working group on defining critical raw materials, http://ec.europa.eu/enterprise/policies/raw-materials/critical/index_en.htm 6 The Principal Rare Earth Elements Deposits of the United States—A Summary of Domestic Deposits and a Global Perspective By Keith R. Long, Bradley S. Van Gosen, Nora K. Foley, and Daniel Cordier US Department of the Interior/ US Geological Survey Scientific Investigations Report 2010–5220 Nov 17 2010 7 US Geological Survey website, http://www.usgs.gov/newsroom/article.asp?ID=2642 8 Scarcity of Minerals: a strategic security issue, The Hague Centre for Strategic Studies, No. 02/01/10, www.hcss.nl/en/download/1286/.../HCSS_Scarcity%20of%20Minerals.pdf 9 Houston Museum of Natural Science, http://earth.rice.edu/mtpe/geo/geosphere/topics/minerals/wmetalreserves.html destination of these metals once in the UK would be useful, to help to advance technologies in reclaiming, recycling and reusing metals already imported.

13. It may be possible to increase domestic supplies of strategic metals. The UK Mineral Reconnaissance Programme provides information on potential sources of strategic metals in the UK and whether these can be economically mined.10

14. There is an opportunity for the UK to develop means of recovering higher grade metals present within waste sites. As demand for metals increases, so does price. As such, lower grade ores are increasingly sourced to meet demand. Such a strategy would enable the UK to reduce its dependency on foreign imports of SIMs. This would need to be accompanied by a change in business and consumer attitudes towards recycling waste materials (see below).

How vulnerable is the UK to a potential decline or restriction in the supply of strategically important metals? What should the Government be doing to safeguard against this and to ensure supplies are produced ethically?

15. The UK is almost exclusively dependent on the import of metals for its technology sector. As global demand of strategic elements increases, the UK is likely to become vulnerable to shortfalls in supply. Particular metals of importance to UK industry include:

• lithium (battery technology and pharmaceuticals), • platinum (catalysis, pharmaceuticals, jewellery, catalytic converters), • indium (flat panel components), • gold (electrical equipment, pharmaceuticals, jewellery etc) • rare earth metals (lasers, magnets, pharmaceuticals, electronics, superconductors, lasers).

Further details of these metals, their uses and estimated reserves are highlighted in Appendix 1.

16. A strategy that encourages the UK industrial sectors to reduce, replace and recycle its SIMs, alongside developing alternative technologies based on substitute materials, would reduce UK dependence on SIMs. Such approaches are currently being developed within other countries.

17. The Japanese technology industry, like the UK’s, is highly vulnerable to changes in supply of imported SIMs. In 2007, the Japanese government published its ‘Element Strategy’, containing four key strategies to reduce, replace, recycle and regulate the use of rare metals within industry. Additionally, support of the underpinning chemical and physical science research is identified as key for the development of technologies that use sustainable alternatives.11

18. China, India, Russia and the USA are among nations that are establishing policies that regulate supply and export in order to control reserves of strategic metals. While these policies do not currently restrict the export of metals, they

10 Evaluation of the Mineral Reconnaissance Programme - evaluation report 14, BIS, http://www.bis.gov.uk/policies/science/science- innovation-analysis/evaluation-reports/evaluation_reports_1_to_23/report_14 11 Strategic Proposal Catalogue 2004-2010”, CRDS, JST, 2010, http://crds.jst.go.jp/output/pdf/contents2010.pdf are geared to increasing export duties that will result in an increase in the cost of supply to the UK.12

19. The EU commissioned a report – ‘Critical raw materials for the EU’ – that 13 highlights the EU dependence on imported metals for its technology industries and identifies the need to establish a trans-European policy to safeguard supplies.

20. These examples highlight the need for the UK government to develop its own strategy.

21. In the short term, the UK would benefit from appropriate monitoring of imported SIMs, particularly with regard to their distribution within manufacturing and attendant products. The RSC would be willing to work with Government and other stakeholders to establish networks of expertise for developing such a framework.

22. In the longer term, investment in research from both Government and industry is essential for the development of alternative technologies that do not rely on SIMs.

How desirable, easy and cost-effective is it to recover and recycle metals from discarded products? How can this be encouraged? Where recycling currently takes place, what arrangements need to be in place to ensure it is done cost- effectively, safely and ethically?

23. Currently, there is less incentive to recycle and recover strategically important metals as technology costs generally outweigh the ease of sourcing new imports. However, high-value metals, such as gold, are of concern, especially when they can become widely dispersed thereby making recovery difficult.

24. The UK would benefit from the strategic development of new recycling and extraction methods, which will require financial support of the underpinning research. The key areas to focus on are recycling, replacing, reduction and recovery. This management of waste products could produce continued supplies of metals in the longer term.

25. Recycling affords the opportunity to maximise the use of supplies already within the UK. Efficient recycling depends critically on product design, and this needs to encompass design for re-use, re-manufacture as well as recycling. These demand that designers, chemists and engineers work together to ensure that all the components, including the metals, are economically recovered at the end of the product life cycle. A key goal to ensure recycling is adopted more widely across the manufacturing sector is that products developed from recycled components meet the same quality standards as those made from originally sourced materials. Specified design would allow for easy recycling, while appropriate standards and sufficient labelling would help to specify the quality of recycled materials.

26. Orangebox is an office furniture design company setting a good example. Their business model encompasses a cradle-to-cradle approach to product design.

12 Scarcity of minerals:a strategy security issue, The Hague Centre for Strategic Studies, 2010, http://www.hcss.nl/en/publication/1285/Scarcity-of-Minerals.html 13 Science Daily website, http://www.sciencedaily.com/releases/2006/03/060314233840.htm Incorporating an end-of-life pick-up recycling service, the entire production process is designed to have minimal energy impact. Orangebox have been supported by Chemistry Innovation Knowledge Transfer Network, an organisation that brings together designers, businesses, chemists and engineers to promote cradle-to-cradle product design. This pioneering approach needs to be extended to other businesses.

27. A 2010 Johnson Matthey review of global statistics for platinum supply and demand14 suggests that future supplies of platinum (and other metals such as ruthenium, rhodium, iridium and palladium) recovered from automotive catalysts, jewellery and electronics are likely to increase. Improved recovery and recycling processes will enable the recovery of greater quantities of these metals to meet demand.

28. IBM is another company that monitors its metal recycling and waste management practices. Their Global Asset Recovery function tracks all material that is returned at the end of product life, recording what is recycled and what sent to landfill. In the past three years, their major de-manufacturing locations have recycled more than 55,800 tonnes of product waste including over 37,800 tonnes of ferrous and non-ferrous metals; only a fraction of a percent went to landfill.15 Where products contain strategically important materials, we should ensure that there are sufficient drivers for suppliers take back their products at the end of life to ensure recycling occurs ethically and safely.

29. Recycling gold from electronic equipment is challenging, but vast improvements in recycling techniques are being made.16. Its low chemical reactivity and excellent electrical conductance make gold difficult to replace in high-end electrical equipment. While there is significant interest in the development of copper alloys, which may provide cheaper alternatives, there remain significant technical barriers.17 30. Indium is another metal that is difficult to reclaim.18 The process is energy- and time-consuming and takes several weeks to obtain a reusable form of the metal. New processes are required to make this more cost-efficient in order for industry to adopt these methods.

31. Neodymium gradually loses some of its magnetic properties when recycled, making it less effective when reused in a new product. Therefore, alternative materials are required together with more efficient recycling processes.

32. Reduction in the quantities of metals incorporated into products would allow the UK to extend the lifetimes of the imported metals supplies. One example of such an approach is the smaller quantity of platinum deployed in catalytic converters developed by the Mazda Motor Corporation, which required the inputs of chemists, engineers and designers.19

14 Johnson Matthey, Platinum Today website, Platinum 2010 Interim Review, http://www.platinum.matthey.com/publications/pgm-market-reviews/archive/platinum-2010-interim-review/ 15 IBM, http://www-03.ibm.com/financing/us/recovery/large/disposal.html 16 Gold Bulletin, Gold Council, volume 23, p209, http://www.goldbulletin.org/assets/file/goldbulletin/downloads/Hageluken_3_43.pdf 17 Gold Bulletin, Gold Council, volume 43, p150, http://www.goldbulletin.org/assets/file/goldbulletin/downloads/Breach_3_43.pdf 18Geology.com, http://geology.com/articles/indium.shtml 19Chemistry World, October 2007, http://www.rsc.org/chemistryworld/News/2007/October/10100701.asp 33. Metals can be recovered from landfill sites. However, there are issues whether current sources of waste metals within the UK hold enough reclaimable metal to meet technological demand and whether recovery is cost effective. Landfill sites contain many redundant electrical equipment components. These items are important and potential sources of SIMs, including gold, neodymium, lithium etc. Currently there are no cost-effective ways to extract these metals. For example extracting indium from even one brand of television requires several different processes since each set originates from different suppliers and is designed slightly differently. Consistent design features will a key improvement required to enable sustainable and efficient metal recovery in the future. Rather than export most of our waste, as we do presently, government should consider ways in which SIMS are retained within the country for re-processing. This should include investigation as to whether current waste materials within land fill sites could be incinerated to allow recovery of metals from the reduced ash. This could be a potential further inquiry.

34. Additionally, other, less obvious, sources of recoverable metals need to be explored - for example the high levels of platinum present in road dust.20

Are there substitutes for those metals that are in decline in technological products manufactured in the UK? How can these substitutes be more widely applied?

35. In some instances, there is no foreseeable method to replace certain metals with alternative materials. In such instances, use of reduced metal quantities is a short to medium term solution that will assist in reducing metal consumption although it does not eliminate metal dependence. As mentioned elsewhere, product design will prove critical in this regard.

36. While some SIMs are being replaced by alternative technologies, this remains a long-term strategy that will require continued research investment to develop many viable alternatives.

37. Sourcing alternatives for indium is a high priority, as the estimated limit to sources is 4 years. Indium is used in light emitting diodes (LEDs) in televisions; these are gradually being replaced by organic LED versions.21 Samsung for example are producing 3-D TVs using this new technology, though production is based in South Korea.22

38. In the UK, Plastic Logic and Oxford Advanced Surfaces Group Plc – spin-out companies from Cambridge and Oxford Universities, respectively – are developing ‘plastic electronics’ from non-metallic materials for use in display technologies.23,24

39. There is potential to replace the lithium used in batteries with alternative materials such as disodium sulphide. Similarly, it may be possible to replace platinum in solar technologies with graphene (a sheet form of carbon one atom

20 Today's wastes, tomorrow's materials for environmental protection, Hydrometallurgy, vol. 104, issue 3-4, Oct 2010, http://linkinghub.elsevier.com/retrieve/pii/S0304386X10001659 21 Chemical Sciences in Society Summit 2010: sustainable materials, workshop discussions. 22 Which, http://www.which.co.uk/news/2010/01/ces-2010-sony-and-samsung-unveil-3d-oled-tvs-193790/ 23 Plastic Logic, http://www.plasticlogic.com/ereader/plastic-display.php 24 Oxford Advanced Surfaces, http://www.oxfordsurfaces.com/content/press/press.asp thick).25 However, additional research is required before these alternatives become commercially feasible.

40. In the USA, copper-coated graphite compounds are potential future replacements for platinum in solar cells.11 Should this technology prove to be viable, it is attractive because copper and graphite are non-scarce elements.

What opportunities are there to work internationally on the challenge of recovering, recycling and substituting strategically important metals?

41. There is an opportunity for the UK to take the lead in reducing, recovering and recycling strategically important metals. At a national level, the UK’s world-class science base and industries can develop technologies to reduce reliance on imported metals. Globally, we can work with other countries to implement legislative measures that can regulate supplies.

Leading by example 42. The UK has a long established record in world-class research. As such, there is a huge opportunity for the UK to be at the forefront of the development of stewardship strategies for SIMs, alongside innovation in alternative technologies that either utilise more abundant elements or alternative materials.

43. The UK can develop waste management strategies to recycle those metals already in circulation, thereby enabling the country to reduce its dependence on imports on a shorter timescale. Using our strong product design networks, the UK can develop new products that encompass ease of recycling with aesthetic appeal to the consumer. Scientists and engineers will play an important role in harnessing ways to reclaim metals within refuse sites. Collaboration between industry and academia will ensure that new processes are cheap, practical and effective.

44. There is an opportunity for the UK to become world-leaders in material recycling and reuse. Some UK companies are already leading the way. Axion is a company that recycles plastics, from discarded clothes hangers for instance.26 The recovered materials are exported to China (where they were originally sourced) to be re-manufactured into new products for re-export to the UK. This kind of recycling is an example of how a cradle-to-cradle lifecycle approach to product design can provide economic benefits to the companies that adopt it.

International collaboration 45. Global strategies to acquire and regulate the use of strategic elements are urgently required and many countries are now legislating to mitigate the effect of dwindling supplies. The UK could learn from other countries who are already implementing policies to reduce their reliance on imported metals.

46. A report produced for the Japanese government in 200727 lays down four principles for the use of rare metals and regulated elements: reduction, replacement, recycling, and regulation. On the basis of these principles, Japan

25 Highlights in Chemical Science, RSC, October 2010, http://www.rsc.org/Publishing/ChemScience/Volume/2010/10/Mimicking_nature_solar_cells.asp 26 Axion Group, http://www.axionrecycling.com/ 27 Strategic Proposal Catalogue 2004-2010, Centre for Research and Development Strategy, Japan Science and Technology Agency: ‘Element Strategy’, pg. 90, http://crds.jst.go.jp/output/pdf/contents2010.pdf has defined their element strategy as one of the most important priorities for science and technology research.

47. In November 2010, representatives from the US Department of Energy (DOE), national laboratories, industry, and Japanese institutes gathered for a roundtable discussion on strategies with regard to rare earth elements. with an emphasis on those used in clean energy technologies.

48. In December 2010, the US DOE launched its Critical Materials Strategy28 The report examines the likely role of rare earth metals and other materials in clean energy technologies. The DOE describes plans to: • develop its first integrated research agenda addressing critical materials • strengthen its capacity for information-gathering on this topic • work closely with international partners, including Japan and Europe, to reduce vulnerability to supply disruptions and address critical material needs.

The Royal Society of Chemistry

22 December 2010

28 Critical Materials Strategy, US Department of Energy, December 2010, http://www.energy.gov/news/documents/criticalmaterialsstrategy.pdf Appendix One

Metal Group Where Finite Uses3029 Alternatives mined12 Limit / yr1 Platinum29,30 Pt Platinum S Africa, N & S 42 Catalysis31, graphene Metals America pharmaceuticals31,34, surgical implants jewellery, electrolysis, catalytic converters Ruthenium29,30 Rh Platinum S Africa, N & S 42 Electronics, jewellery, Metals America pens, cathodes, radiotherapy32 Rhodium29,30 Rh Platinum S Africa, N & S 42 Catalysis, jewellery, Metals America electronics Osmium29,30 Os Platinum S Africa, N & S 42 Fountain pen nibs, Metals America phonograph needles (early makes), Fingerprint detection, surgical implants Iridium29,30 Ir Platinum S Africa, N & S 42 Deep water pipes, Metals America catalysis, spark plugs, source of gamma radiation33 Palladium29,30 Pd Platinum S Africa, N & S 42 Jewellery, catalysis, Metals America dentistry34, watches, spark plugs, electronics, blood sugar testing35 Lithium29,30 Li Andes in S 45 Batteries, energy storage Disodium America sulphide Indium29,30 In China, USA, 4 Thin layer solar cells, Organic light Canada, glass coatings in emitting Russia TVs, diodes semiconductors, light emitting diodes, medical imaging of antibiotic therapy Gold29,30 Au Transition China, S Africa, 36 Electronics, Nickel/Copper Metal S America, pharmaceuticals36,37, alloys38 Australia jewellery, food, cosmetics Scandium29,30 Sc Rare Earth Asia, Australia, Not Light alloy for aerospace Metal N America estima comonents, additive ted in Mercury-vapour lamps Yttrium29,30 Y Rare Earth Asia, Australia, Not Laser, high-temperature

29 Chemicool, http://www.chemicool.com/elements/platinum.html 30 RSC Visual Elements, http://www.rsc.org/chemsoc/visualelements/index.htm 31 Johnson Matthey, http://www.platinum.matthey.com/ 32 NHS, http://www.library.nhs.uk/Eyes/ViewResource.aspx?resID=240995 33 Journal of Nuclear medicine, vol. 26, no. 11, November 1985, http://jnm.snmjournals.org/cgi/reprint/26/11/1283.pdf 34 Johnson Matthey, http://www.platinum.matthey.com/applications/industrial-applications/dental/ 35 Accu- check strips, Roche, http://www.poc.roche.com/en_US/pdf/Evaluation_Report001.pdf 36 Science Daily, 15 March 2006, http://www.sciencedaily.com/releases/2006/03/060314233840.htm 37 NHS, http://www.nhs.uk/Conditions/Rheumatoid-arthritis/Pages/Treatment.aspx 38 University of Connecticut, http://news.engr.uconn.edu/uconnutc-team-develops-alternative-to-gold-in-electrical- applications.php

Metal N America estima superconductors, ted microwave filters Lanthanum29,30 La Rare Earth Asia, Australia, Not High refractive index Metal N America estima glass, flint, hydrogen ted storage, battery- electrodes, camera lenses, fluid catalytic cracking for oli refining Cerium29,30 Ce Rare Earth Asia, Australia, Not Chemical oxidizing agent, Metal N America estima polishing powder, ted yellow colours in glass and ceramics, catalyst for self- cleaning ovens, fluid catalytic cracking catalyst for oil refineries Praseodymium29, Pr Rare Earth Asia, Australia, Not Rare-earth meagnets, 30 Metal N America estima lasers, core ted materials for carbon arc lighting, colourant in glasses and enamels, additive in didymium glass used in welding goggles Neodymium29,30 Nd Rare Earth Asia, Australia, Not Rare-earth magnets, Metal N America estima lasers, violet colours ted in glass and ceramics, ceramic capacitors Promethium29,30 Pm Rare Earth Asia, Australia, Not Nuclear batteries Metal N America estima ted Samarium29,30 Sm Rare Earth Asia, Australia, Not Rare-earth magnets, Metal N America estima lasers, violet colours ted in glass ceramics, ceramic capacitors Europium29,30 Eu Rare Earth Asia, Australia, Not Red and blue phosphors, Metal N America estima lasers, mercury- ted vapor lamps Gadlinium29,30 Gd Rare Earth Asia, Australia, Not Rare-earth magnets, high Metal N America estima refractive index glass ted or garnets, lasers, x- ray tubes, computer memories, neutron capture Terbium29,30 Tb Rare Earth Asia, Australia, Not Green phosphors, lasers, Metal N America estima fluorescent lamps ted Dysprosium29,30 Dy Rare Earth Asia, Australia, Not Rare-earth magnets, Metal N America estima lasers ted Holmium29,30 Ho Rare Earth Asia, Australia, Not Lasers Metal N America estima ted Erbium29,30 Er Rare Earth Asia, Australia, Not Lasers Metal N America estima ted Thalium29,30 Tm Rare Earth Asia, Australia, Not Portable X-ray machines Metal N America estima ted Ytterbium29,30 Yb Rare Earth Asia, Australia, Not Infrared lasers, chemical Metal North estima reducing agent America ted Lutetium29,30 Lu Rare Earth Asia, Australia, Not PET Scan detectors, high Metal N America estima refractive index glass ted

Appendix 2 WRITTEN EVIDENCE SUBMITTED BY GARETH P HATCH (SIM 18)

INQUIRY ON STRATEGICALLY IMPORTANT METALS

Disclaimer The views expressed in this paper are solely those of the author and do not necessarily represent or reflect the views of Technology Metals Research, LLC or those of any other individual or entity.

About the Author Gareth Hatch is a Founding Principal of Technology Metals Research, LLC. He is interested in helping people to understand the challenges associated with the growing demand for rare-earth elements [REEs] and other critical and strategic materials, and how those challenges affect market sectors throughout the entire technology supply chain. He is currently based in the suburbs of Chicago, Illinois, USA.

For several years Gareth was Director of Technology at Dexter Magnetic Technologies, where he focused on the design & application of innovative magnetic materials, devices and systems, in order to solve real engineering problems. He led a stellar team of engineers who helped customers and clients in the aerospace, defence, medical, data storage, oil & gas, renewables and industrial sectors. He holds five US patents on a variety of magnetic devices.

A two-time graduate of the UK’s University of Birmingham, Gareth has a B.Eng. (Hons) in Materials Science & Technology and a Ph.D. in Metallurgy & Materials, focused on rare-earth permanent-magnet materials. He is a Fellow of the UK’s Institute of Materials, Minerals & Mining, a Fellow of the UK’s Institution of Engineering & Technology, a Chartered Engineer and a Senior Member of the IEEE. Gareth is also a Chartered Scientist and a Chartered Physicist through the UK’s Institute of Physics.

Gareth is the Founding Editor of Terra Magnetica, an Editor at RareMetalBlog and is Newsletter Editor and Chicago Chapter Chair of the IEEE Magnetics Society. He is Founder of the Magnetism & Electromagnetics Interest Group and the Strategic Materials Network, both at Linkedin.com. Gareth is also an Advisor to Energy Scienomic, a non-profit organization focused on best practices and standardization of global energy production data and information.

RARE-EARTH ELEMENTS: SUPPLY AND DEMAND CHALLENGES FOR UK INDUSTRY

INTRODUCTION AND BACKGROUND 1. As recently noted by the House of Commons Science and Technology Select Committee [1], there is growing speculation on the availability of a variety of metals of strategic importance to UK industry. Unfortunately much of this speculation has been driven by frequently inaccurate media coverage of the sector. Nonetheless, there are some distinct challenges that the UK faces when it comes to the procurement of these metals.

2. Rare earths are almost universally viewed as being of strategic importance. Rare-earth elements (REEs) exhibit special electronic, magnetic and optical properties. In common with a number of other strategic metals, REEs are enablers; although generally used in small quantities, components based on REE alloys and compounds can have a profound effect on the ultimate performance of complex engineering systems.

3. The supply and demand challenges associated with REEs have much in common with other strategically important metals. Given the author’s experience with the rare-earth supply chain, the present work focuses primarily on REEs, as it seeks to address the five groups of questions raised by the committee. The answers in many cases are likely to be applicable to other strategic metals too.

RARE-EARTH ELEMENTS: TERMS AND DEFINITIONS 4. The International Union of Pure and Applied Chemistry (IUPAC) defines the rare earths as a collection of 17 elements of the periodic table [2]. The list includes the 15 lanthanoid elements (atomic numbers 57 through to 71), in addition to scandium (Sc) and yttrium (Y). In practice, Sc does not usually occur in the same minerals as the lanthanoids + Y, and thus the rare-earths industry generally omits reference to it. Also, promethium (Pm) does not occur freely in Nature, and thus we are left with the 15 elements shown in Figure 1.

5. The rare-earths industry further differentiates REEs as being either light or heavy rare earths. In general, the first five lanthanoids are referred to as light REEs (LREEs). This leave the remaining lanthanoids + Y as heavy REEs (HREEs) as shown in Figure 1. Note that this subdivision does not quite match the terminology used by many scientists; there is little reason to delve into this discrepancy any further; suffice it to say that it is important to note exactly which elements are being referred to, whenever the terms ‘light’ REEs or ‘heavy’ REEs are being used in any discussion on the subject. HREEs are generally rarer than LREEs, and are thus generally more valuable. Note that within the industry, it is customary to discuss REEs in terms of their oxide equivalents (REOs).

6. REEs are always found together within any given rare-earth deposit, albeit in different proportions from one deposit to another. The minerals containing the REEs have to be extracted and the individual REEs separated from one another. Because they are chemically very similar, this separation process requires intensive chemical processes. Specific processes have to be fine-tuned for each deposit, because of the unique mineral ‘signature’ of each deposit.

RARE-EARTH DEMAND DRIVERS 7. Before addressing specific concerns relating to the supply of REEs, it is important to review the key drivers for the growing demand for REE alloys and compounds.

8. Certain REEs might be used directly in compound form, while others may be incorporated into engineered components via alloying with other elements. Such components are then used within sub- assemblies, which are in turn used to create engineered devices and systems. In simplistic terms, any engineered system can be seem as the sum total of a set of sub-assemblies, consisting of a set of components. The materials used in those components are the foundational basis for the entire engineered system.

9. Table 1 shows the estimated 2010 global demand for REEs. These usages correspond to the production of components or component-level goods. 60% of demand comes from China, with 20% coming from Japan and Korea. Usage in the UK and all other countries with the exception of the USA totals 8%, a relatively small proportion of the global demand.

10. The key applications are for use in permanent magnets (primarily Nd, dysprosium (Dy), praseodymium (Pr) and samarium (Sm)), catalysts (primarily lanthanum (La) and cerium (Ce)), metal alloys (primarily La for battery packs) and polishing (primarily Ce for glass and silicon wafer polishing).

11. The steady increase in demand for REEs is directly correlated to overall GDP growth globally. There has also been increased demand, particularly in developed countries, for energy-efficient appliances and devices that use rare-earth-based components.

12. Going forward, the demand for next-generation wind turbines and hybrid and plugin electric vehicles are the key growth drivers for the specific REEs required for those applications. Table 2 shows forecasted demand for 2015, with significant predicted increases in demand for REEs for use in permanent magnets and metal alloys in particular. Market share by region is very similar, though the overall tonnage is significantly increased to 185,000 t.

13. In terms of specific demand by UK industry, very little REE raw material is presently used to produce components in the UK. It is in the use of semi-finished and finished goods such as permanent magnets and other components, and the devices and systems created from them, that companies in the UK generally interact with the rare-earths supply chain.

Q1: Is there a global shortfall in the supply and availability of rare-earth metals?

14. Until relatively recently, there have been few supply issues for REEs. In the longer term (2-3 years and beyond for LREEs and 4-5 years and beyond for HREE) there should be few problems in sourcing REEs. The issue comes in dealing with certain supply challenges in the interim periods - the next 0-3 years for LREEs and 0-5 years for HREEs.

15. It is widely accepted that at present, over 97% of global rare-earth production originates in China. However, there are numerous rare-earth deposits located outside of China, many of which have active development projects underway. Over a dozen of these projects are at an advanced stage of development (see Table 3). There is thus no shortage of potential projects that will eventually diversify the global supply of REEs. The time to develop such projects can be considerable, however, and there is growing concern about the availability of materials in the short term, and certain specific REEs in particular.

16. In recent years, China has imposed export quotas on rare-earth shipments out of China. Ostensibly these were put in place by the authorities to allow for the shut down of inefficient, polluting mines and to allow for environmental remediation.

17. Up until the second half of 2010, there have been few real challenges associated with the physical supply of rare earths to the rest of the world from China. Figure 2 shows the export quota levels in recent years, along with official demand numbers from the rest of the world (ROW), as well projected actual demand (an estimated 15-30,000 tonnes per annum of REOs are said to be illegally smuggled out of China to the rest of the world in recent years, and so the actual ROW demand metrics in Figure 2 attempt to account for this). It can be seen that up until 2010, the export quotas from China were broadly in line with ROW demand. The dip in 2009 of demand reflects the global recession and its effects on demand for REEs.

18. It should be noted that export quotas are allocated by the Chinese authorities to individual trading companies in China, some of which are foreign-owned. It should also be noted that the quotas to date have been monolithic - there has been no differentiation between specific REEs or REOs within those quotas. Furthermore, the export quotas do NOT apply to semi-finished or finished goods, such as permanent magnets or magnet alloys, produced in China. As present they apply only to the raw material forms of REEs and simple REE-based compounds.

19. In July 2010, the authorities announced a significant reduction in export quotas for the latter half of the year - a maximum of approximately 8,000 t of REOs for export, bringing the total for 2010 to just over 30,000 t. This was a 40% reduction over the prior year and caused considerable consternation in the rare-earth industry.

20. The result of this action were very significant price increases for the export of LREEs (in some cases by 1,000-1,500%). LREEs are historically lower-value materials than HREWs, and because of the quota limits, Chinese traders prefer to sell HREEs if they can, in order to maximise profits. The underlying base price for the LREEs actually remained largely unchanged; the traders imposed significant surcharges on top of those prices, resulting in the overall price increases. If the quota for 2011 is further reduced, then further price increases are likely.

21. One other ongoing challenge of increasing importance is the fact that the ratios of individual REEs required to fulfill global demand for the various applications listed in Tables 1 & 2, generally do not occur in the same ratios naturally in the various rare-earth deposits available for extraction - either in China or elsewhere. This leads to an imbalance in the production of certain REEs compared to others.

22. There is additional pressure on specific REEs, given the demand for them, and in particular for oxides of Nd, and Dy (for permanent magnets), as well as Eu and Tb (for phosphors). Some projections indicate that there demand for these REEs will outstrip supply, by 2015, even if some of the new projects come on-stream soon.

Q2: How vulnerable is the UK to a potential decline or restriction in the supply of rare earths? What should the government be doing to safeguard against this and to ensure supplies are produced ethically?

23. There is relatively little industry in the UK that is directly connected to the rare-earth supply chain at the raw-materials level. Most companies are connected further up the chain, so any vulnerabilities are indirect, though they certainly exist, and are of potential concern.

24. One exception is a company called Less Common Metals (LCM), based in Birkenhead. LCM produces rare-earth-based alloys and compounds. Historically, LCM has taken raw materials produced in China and processed them into semi-finished goods. The company is owned by Great Western Minerals Group, a Canada-based company in the process of developing a formerly producing rare-earth mine in South Africa. The plan is for materials mined and extracted from South Africa, to be refined into metals elsewhere, before being processed into alloys at LCM.

25. Despite the indirect nature of UK industry’s interaction with the rare-earth supply chain, it is still potentially vulnerable to disruption on a couple of fronts.

26. The first is on the geopolitical front. There was much coverage in the media recently about an alleged embargo that China placed on REE shipments to Japan, supposedly in retaliation for the arrest of a Chinese fishing vessel captain. Despite these assertions in the media, there was actually little evidence to suggest that the supply disruption to Japan was as a result of retaliatory actions on the part of the Chinese authorities. One only has to revisit Figure 2 to see that individual trading companies in China likely started running out of their allocated quotas months ago. Given the demand, and potential profits to be made, illegal smuggling also increased, and only a few such shipments needed to be intercepted for the authorities to decide to clamp down and to do more rigorous inspections of all such goods (leading to delays, and certain shipments being prohibited).

27. Regardless of the reality of what happened between Japan and China, there is obviously concern that China could, for whatever reason, decide to unilaterally restrict rare-earth shipments to the UK and elsewhere. Note again, however, that it is likely that the cast majority of goods containing REEs, arrive into the UK in the form of components and sub-assemblies produced in China - not the raw materials themselves. Still, relying on the magnanimity of a single country for such exports is certainly a key potential issue.

28. The second vulnerability results from the geographic ‘bottleneck’ caused by the fact that the vast majority of LREEs produced in China, are done so in the Bayun Obo region, up in Inner Mongolia. It would require just one moderate earthquake in this region to potentially devastate the entire global supply chain for these materials. A similar catastrophe in the SE of the country would have similar effects on the supply of HREEs.

29. Diversification of global supply therefore, makes sense, business-wise. Given the relatively small amount of raw material REE goods used by UK industry, however, it is difficult to see how the UK Government might mitigate against either of the above circumstances. The maintenance of a modest stockpile of raw materials, either unilaterally or in conjunction with European partners, might be one way to solve the issue, particularly to help safeguard the capabilities of companies such as LCM and others.

30. In the long term, the UK government might try to encourage the return of companies and manufacturing entities to the UK, who can produce the components and sub-assemblies that contain REE alloys, in order to safeguard supplies of those parts of the supply chain. it might also consider, either unilaterally or together with European partners, following in the footsteps of Japan and JOGMEC, its government-industry partnership-based resource company that goes out around the world to find and to develop natural resources of strategic importance to Japan and its industrial base. Granted, Japan has a much larger user base when it comes to REEs than the UK and Europe, but such an approach is still worth considering.

Q3: How desirable, easy and cost-effective is it to recover and recycle rare-earth metals from discarded products? How can this be encouraged? Where recycling currently takes place, what arrangements need to be in place to ensure it is done cost-effectively, safely and ethically?

31. Given the significant resources required to extract and to produce REEs, it is absolutely desirable to try to recover these valuable materials from the waste streams of our society. Historically the over- dispersion of many of these metals into low concentrations made it questionable as to whether such recycling could be done cost-effectively, assuming there was a process available to do it.

32. In the case of REEs, it is likely that the recovery of these materials could be made cost-effective, given the right approach. To date, however, there has been little work done to study the economic feasibility of candidate processes that have been studied academically.

33. Once such process, developed at the University of Birmingham, involves the processing of previously used rare-earth permanent magnets, into a powder form of the underlying magnet alloy, which can then be re-used to make new magnets. The concept does not require the processing of the alloy back into the constituent elements, unlike related processes recently developed in Japan.

34. The perennial challenge for such research teams is the ongoing funding of their research. In the interests of full disclosure the author recently co-founded a private US-based company which has as its sole mission, the funding of feasibility studies for promising recovery technologies for REEs and other rare metals, such as the Birmingham project. The UK Government might consider setting up special initiatives to help fund such feasibility studies, and work towards the goal of developing the logistics infrastructure required to get access to the rare metals in question, perhaps part of other 兎nd-of-life・ initiatives for consumer and other products.

Q4: Are there substitutes for rare earths in technological products manufactured in the UK? How can these substitutes be more widely applied?

35. As described above, REEs are present at the foundational materials level in the ‘structural hierarchy’ of engineering products and systems. It is generally far easier to consider substitutions at the system, sub-assembly or component level, than at this materials level, because of the time that it takes to research new materials systems and microstructures. Because REEs are exploited for their unique optical, electronic and magnetic properties, substitutions are even more difficult in their case.

36. That said, there have been significant efforts made, especially in Japan, to reduce the amount of scarce REEs and other strategic metals in components, while maintaining the original performance characteristics [3]. A good example of this is work being done to reduce the amount of the increasingly scarce HREE Dy in permanent magnets, by manipulating the structure of the magnet alloy at the microscopic level during processing, and ‘putting’ the Dy only in certain places within the alloy where it is actually needed.

37. It is important to note the potential unintended consequences of well-meant substitution efforts, such as reduced systemic efficiencies, or costs of production and so on. It is important not to “throw the baby out with the bath water” in the search for overcoming short-term supply difficulties.

Q5: What opportunities are there to work internationally on the challenge of recovering, recycling and substituting rare-earth metals?

38. At present there is relatively little work underway in this area internationally, outside of Japan. The US Department of Energy issued a report in December 2010 calling for the US to get actively involved in such activities [4]; there has been legislation considered in the US Congress designed to encourage such activities, including international cooperation with the European Union and entities within it.

39. It is the author’s experience that there is tremendous enthusiasm in both the private and public sectors in numerous countries, particularly in Europe, but also in North America, Japan and Korea, to see such initiatives succeed. Perhaps by combining such activities under a common framework with related activities, momentum could be achieved. There are certainly European Union initiatives underway to encourage collaboration internationally, on the activities suggested by this question.

40. There are precedents for such frameworks, such as the Concerted European Action on Magnetics, initiated in the mid 1980s to incubate fundamental research into rare-earth-based permanent magnets [5]. Perhaps the UK could take the lead in establishing a similar type of framework, involving not just European but also North American, Australian and Asian partners (including institutions in China as well as Japan and South Korea).

Declaration of Interests 41. Except for the recycling-related company mentioned above, the author owns no shares or stock options in any of the companies noted above, Nor in any junior mining or exploration company operating in the rare-earths sector.

Gareth P Hatch BEng (Hons) PhD CEng FIMMM FIET SMIEEE CSci CPhys MInstP Founding principal Technology Metals Research, LLC

21 December 2010

References 1. House of Commons Science and Technology Select Committee, Committee announce new inquiry into strategically important metals, UK Parliament, Nov 11, 2010, last accessed Dec 17, 2010.

2. N. G. Connelly, T. Damhus, R. M. Hartshorn & A. T. Hutton, ‘Nomenclature of Inorganic Chemistry’, IUPAC - RSC Publishing, Cambridge, 2005.

3. G. P. Hatch, Tackling The Rare Metals Shortage: Can We Learn From The Japanese?・ , Technology Metals Research, Nov 5, 2009, last accessed Dec 17, 2010.

4. D. Bauer, D. Diamond, J. Li, D Sandalow, P. Telleen & B. Wanner, U.S. Department of Energy Critical Materials Strategy, U.S . Department of Energy, December 2010, last accessed 17 Dec, 2010.

5. G. P. Hatch, The Concerted European Action On Magnets: A Model For Facing The Rare Earths Challenge?, Technology Metals Research, Feb 10, 2010, last accessed 30 Oct, 2010.

Written evidence submitted by the Design Council (SIM 19)

1. Executive Summary 1.1 The Design Council welcomes the opportunity to respond to the House of Commons Science and Technology Committee inquiry into strategically important metals.

1.2 The Design Council is the UK’s national strategic body for design and government advisor on design.

1.3 Our response is built on the breadth of our experience and expertise of working with business, universities and the public sector. Our views are drawn from our Design Industry Research 20101 and a strong evidence base from our design support programmes for SMEs2, including technology start ups, and technology transfer offices in leading universities to help develop new products, services and commercialise new technology.3

1.4 Recover, reconstruct and rekindle should be the keywords for a new, more environmentally conscious economic recovery.

1.5 With 80% of the environmental impact of today’s products, services and infrastructures being determined at the design stage4, designers have a critical role to play in tackling these issues more comprehensively, fully integrating a green approach into their standard practice.

1.6 There should be a greater integration of design and design thinking methods with STEM and business curricula at all education levels.

1.7 Government should embed cradle-to-cradle thinking and look at an innovative approach to devising end-of-life strategies as part of its Growth Review, bringing innovation, technology, manufacturing and skills closer together.

1.8 Our response highlights: the value of design to UK plc, how design could help tackle resource and material scarcity through designing for deconstruction, nonpollution and designing to last and how strategic use of design could help changing business models and improving supply chains.

2. Value of design 2.1 The UK has a world leading design industry worth £15bn to the UK economy. An estimated 232,000 designers work in the UK, this is a 29% increase on 2005. The industry is mainly made up SMEs and 93% of design businesses work for clients in the UK.

2.2 The importance of design as a tool for innovation, productivity and economic growth is accepted. Research has consistently shown a link between the use of design and improved business performance across key measures including turnover, profit and market share. Between 1995 and 2004, the share prices of design-conscious companies outperformed other firms by 200%5. For every £100 a design-alert business spends on design, turnover increases by £2256.

2.3 The UK creative industries, including design, are a major and growing contributor to the UK economy. The UK design industry is renowned worldwide and a draw for big business. Multi-nationals

1 http://www.designcouncil.org.uk/our-work/Insight/Research/Design-Industry-Research-2010/ 2 over 2000 companies across different sectors went through the Design Council’s Designing Demand programme to date, for more info visit: http://www.designcouncil.org.uk/our-work/Support/Designing-Demand 3 http://www.designcouncil.org.uk/our-work/Support/Innovate-for-Universities 4 How to do Ecodesign: A guide for environmentally friendly and economically sound design, German Federal Environment Agency (ed), 2000 5 Design Index, Design Council (2004) 6 Value of Design, Design Council (2007)

base their design centres in the UK to take advantage of the skilled design professionals and leading edge design, including Yamaha Music Corporation, Nissan, Samsung, Nokia and Motorola.

2.4 Research indicates £15 billion was spent on UK design in 2009 via in-house design teams and freelancers and consultancies7 and the added value of design to the wider economy is greater than for any other sector in the creative industries8. The UK needs to play to this strength.

2.5 The UK government has made a strong commitment to knowledge driven-economy rooted in new discoveries and with a strong emphasis on green technology. They have ring-fenced the science budget, committed to establishment of new Technology Innovation Centres, and announced a new Green Investment Bank. However, our research and practical experience at the Design Council has shown that design is too often the missing link in turning new discoveries into workable business propositions.

3. Green challenge 3.1 Inevitably, as oil prices keep rising and the rate of oil production enters terminal decline, materials and resources will become ever more expensive, pushing further the drive for more environmental efficiency.

3.2 According to Dr Mike Pitts at the Royal Society of Chemistry, since 1900 the UK has increased its consumption of consumables by 40 times. The mass of raw materials extracted to make them comes from an even bigger mass of minerals (it takes 1.5kg of raw material to make just one toothbrush, and the US landfills 25 000 tonnes of toothbrushes every year), creating a huge amount of CO2 emissions in the process.9

3.3 Dr Pitts talked at Greengaged10 in 2008 about other ’peaks’ in mined materials. He presented a memorable slide of the periodic table - a visual representation of every known element on the planet - showing how, if we continued using and designing without easy (and safe) disassembly and recycling, we would banish a big chunk of these essential building blocks to landfill very soon. Five to ten years’ time, in some instances.

3.4 So there is need for more responsibility in the way we choose materials, and for a wider outlook for new opportunities to turn waste into someone else’s raw material.

4. Designing for deconstruction and nonpollution 4.1 What designers can bring to the party is much more than a reactive approach. Generic principles such as efficiency, nonpollution, whole-life design and dematerialisation, can be used in any area of design. The more creative and more ingenious we are, the quicker and bigger the positive environmental paybacks. However, our design industry is slow on the uptake of designing for deconstruction.

4.2 Mobile phones are case in point. Our wish to upgrade to the next model is fuelled by tantalising ads and seductive designs. Would this be such a problem if we designed the phone so all the materials could be separated out? It becomes an issue when considering how many different elements are built into modern mobile phones. It is not to say that elements like indium or gold will disappear completely, but designing in such a way that we cannot get them out is irresponsible for future needs. In 2005, more than $400m (£255m) worth of metals were locked away in unused mobile phones, according to Pitts.

4.3 Appreciating raw materials is one half of the process – the other is understanding production cycles and reconfiguring them for optimum environmental efficiency. Innovation in sustainable

7 Labour Force Survey, ONS & Design Industry Research, Design Council (March 2010) 8 Creative & Cultural Industries Economic & Demographic footprint research, Creative & Cultural Skills (2008) 9 Thomas, S. Recovery mission: Vision 2011, Design Week, December 2010 10 A sustainability design forum hosted by the Design Council at London Design Festival 2008, http://greengaged.com

technology is happening at such a fast rate that it is hard to keep up, but keep up we must, for new, sustainable technology requires knowledgeable designers.

4.4 Examples abound in the field of packaging. Nick Cliffe from Closed Loop plastics recycling plant reinforces the need to understand what is actually able to be recycled with what can technically be recycled, illustrating that you cannot just substitute one material for another without understanding the consequences.11

4.5 For example, many designers and clients now opt for a bioplastic bag. This is plastic with added degrader in the mix (usually titanium). But this plastic is getting into the recycling stream before the recycling infrastructure is ready, often resulting in contaminated batches.

4.6 Some designers still don’t understand the consequences of decisions that are sometimes purely concerned with aesthetics. Simple things like co-moulding two different plastics in a toothbrush design or laminating a piece of paper can predetermine its painful and slow landfill demise. This will be where new alliances for the design, waste and materials industries can flourish.

4.7 Some industries - such as the automotive sector, with its design of better vehicles - have become much more efficient. And in areas where products are directly accountable for using or emitting pollutants, there have been improvements. Other positive impacts have come from legislation: the waste disposal drive from Europe, through the EU Waste Electrical and Electronic Equipment Directive, and higher landfill taxes have forced alternative thinking on a product’s afterlife.

5. Designing to last 5.1 Companies can strive to build more durable products to ensure they last longer.

5.2 As an example, the furniture company Vitsoe has become a market leader with a product designed to last a lifetime. The 606 Universal Shelving System’s stated aim is to “help people live better with less that lasts longer.” Its highly flexible modularity allows owners to install and extend their shelving easily themselves. For a nominal fee Vitsoe also offers a service dismantling and rebuilding its system for relocation.

Also, designing product components for easy removal and replacement encourages people to repair parts rather than replacing the whole object when it breaks down.

5.3 The Aeron ergonomic chair shows how successful these principles can be. It has 66% recycled parts and 100 per cent of its aluminium parts are recycled, making it about 95% less destructive to materials, energy, water and air. All its plastic parts are labelled with International Standards Organisation (ISO) recycling symbols and the chair is easy to disassemble, with 94% recyclable parts. Repair is simple and the chair has a ten-year life-span – about double that of an ordinary office chair. It has been a worldwide success and has been recognised as a design classic by the Museum of Modern Art in New York.

6. Designing to recycle and remanufacture 6.1 At the moment, when waste is re-used, it is often downgraded. Cars are routinely melted down without separating out useful metals such as copper, meaning these become unusable in the resulting alloy.

6.2 Xerox, as well as saving resource by making multi-functional products that scan, copy, fax and print, also remanufacture their old products. They estimate that this results in their products having up to seven lives. Xerox began remanufacturing operations in the early 1990s and is now a world leader

11 Thomas, S., It’s time to act, Sustainable Design Supplement, Design Week, 2010

in this field.12 Evidence suggests remanufacture can be twice as profitable as manufacture, but few companies currently use it.13

6.3 Another example is a design-led business Remarkable pencils. In 1996 entrepreneur Edward Douglas Miller decided to make pencils from recycled plastic cups. His company Remarkable rethought waste, and developed a new product design, supply chain and manufacturing process. Remarkable collaborated with a specialist university research unit and also with external design agencies to come up with a brand identity that communicated the essence of the company's values. Since its launch Remarkable has sold more than 100m pencils and has achieved listings with numerous high profile retailers. Douglas Miller said: ‘Design was integral to the whole thing.’

7. Changing Business Models and Improving Supply Chains through Strategic Design 7.1 In the long term the green economy will see the UK develop new industry sectors, in which product and service design will be crucial. In a knowledge based economy, the UK will also need to develop whole new business models, supply chains and ways of working, and here the use of strategic design methodologies will be vital.

7.2 Over the last three years the Design Council has used its roster of world-class Design Associates to work with 1,800 CEOs and their Boards to strengthen management awareness of design as a strategic tool. On average every £1 spent delivers £10 of economic value recorded in profits, sales and jobs as Gross Value Added (or GVA).

7.3 One recent example is a young company that has invented a mouldable silicon called Sugru that can be used to repair household goods. With help from their Design Associate, the MD has gone from a standing-start to attract investment and her product has just been named by TIME magazine as one of the best inventions of 2010.

7.4 A radical re-design was undertaken by the car manufacturer Riversimple, who undertook to transform its business model not just its product, production process or supply chain. Riversimple designed a new car through ‘open source’ and they are going to lease this rather than sell it. This has moved Riversimple from manufacturing into service provision, making them an exemplar manu- service company.

7.5 Industry has utilized design skills to improve the sustainability of the whole supply chain. In an effort to reduce the impacts of cars on the environment and society, Toyota has created an ‘Eco- Vehicle Assessment Systems’ (Eco-VAS). Eco-VAS is a design tool, which Toyota’s engineers use to measure vehicle impacts through their ‘life cycle’ - during their design and production, distribution, use and disposal.

8. Appendix

8.1 Definitions of Design Ingenious Britain’s definition (2010): “Design is not simply aesthetics; it’s the rigorous process that links new technologies to business – creating things that work properly.” The Cox Review (2005): “Design is what links creativity and innovation. It shapes ideas to become practical and attractive propositions for users or customers. Design may be described as creativity deployed to a specific end.” Design as a driver of user-centered generation (2009), the EC Commission’s working document: “Design for user-centred innovation is the activity of conceiving and developing a plan for a new or significantly improved product, service or system that ensures the best interface with user needs, aspirations and abilities, and that allows for aspects of economic, social and environmental sustainability to be taken into account.”

12 Remanufacturing and Product Design, Caspar Gray, 2006 http://www.cfsd.org.uk/CfSD/Remanufacturing%20and%20Product%20Design.pdf 13 Caspar Gray interview with Rolf Steinhilper, 2006

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We would be happy to provide further information on any of the items above and/or other areas of the Design Council work.

Design Council

20 January 2011 Written evidence submitted by The Minor Metals Trade Association (SIM 20)

INTRODUCTION The Minor Metals Trade Association (MMTA) was established in 1973 and is the leading international business organisation promoting the minor metals, ferro-alloys and rare earth elements industry as a whole. Today the MMTA is the world’s largest industry body dedicated to these strategically important metals.

The MMTA is dedicated to enhancing membership value and promoting the use of and trade in the metals its members are involved in. At the heart of the MMTA are its Members: producers, consumers, traders, warehouses & forwarders, samplers & assayers and financial, information and legal services, all of whom have an important part to play in the smooth running of the minor metal industry. We have 150 member companies in 30 countries and our industry has a collective annual worth of more than 10 billion dollars.

1. Is there a global shortfall in the supply and availability of strategically important metals essential to the production of advanced technology in the UK?

Those strategically important metals that have historically been called ‘minor’ metals are reaching maturity; industrially, economically and politically. The UK is one of the world’s leaders of advanced technologies that consume these elements.

Strategically important metals (minor metals) are often by-products of base metals (such as copper, aluminium and zinc) and therefore their production is not as responsive to changes in price which is the normal way for market conditions to reflect supply and demand of commodities.

In Europe at present, whilst on the one hand the EU are looking to promote strategic raw materials in REACH they are simultaneously creating de facto import tariffs which are destroying the industry for strategic raw materials in Europe. REACH [Registration, Evaluation, Authorisation and Restriction of Chemical substances] legislation adds bureaucratic costs to every strategically important metal produced or imported into Europe in quantities of over one tonne per year. REACH, unintentionally, has been a highly destructive regulation and it is not even fully implemented yet.

2. How vulnerable is the UK to a potential decline or restriction in the supply of strategically important metals? What should the Government be doing to safeguard against this and to ensure supplies are produced ethically?

Barring force majeure it seems unlikely that production of these metals will decline on a global scale given overall growth in mining and mining investment of recent years. There are a small number of metals whose use is being phased out, such as mercury and cadmium, as they can be highly toxic in uncontrolled environments.

Restrictions for political reasons are matters for the UK government to ease through diplomacy. Particular attention should be given to those elements with a high Herfindahl Hirshman Index (HHI), for example gallium, germanium and antimony.

3. How desirable, easy and cost-effective is it to recover and recycle metals from discarded products? How can this be encouraged? Where recycling currently takes place, what arrangements need to be in place to ensure it is done cost-effectively, safely and ethically?

It is highly desirable to obtain the maximum possible benefit from the potential to recycle minor metals. Secondary production of minor metals from recycling (‘urban mining’) is a major growth area for MMTA members, despite the fact that many minor metals are consumed in dissipative uses and cannot be recovered.

Recycling could be assisted through streamlining WEEE regulations and orientating them to be supportive of the industry, especially keeping in mind the REACH regulations which cover the finished goods.

4. Are there substitutes for those metals that are in decline in technological products manufactured in the UK? How can these substitutes be more widely applied?

Many minor metals are employed for their elemental properties (for example rhenium allows jet engines to burn at higher temperatures) which are very difficult to find in substitutes. There are some applications where you’d be hard-pressed to find substitutes, for example certain uses of cobalt where there are particular characteristics that, to some degree, are irreplaceable without sacrificing performance qualities of the end product. On the other hand, the picture is constantly changing with new technological advances and whilst cobalt’s participation in the mobile power business at one stage was viewed as irreplaceable, today there are alternatives.

When considering the use of substitutes it would be negligent not to include due diligence analysis of whether those substitute components have similar sourcing and ethical problems to the materials they replace.

5. What opportunities are there to work internationally on the challenge of recovering, recycling and substituting strategically important metals?

International standards on the movement and disposal of recycling feedstock would help create a level playing field for European and UK industry. Attention should be given to alleviating the unintended negative impact that REACH legislation is having on UK industry. This inquiry is a step in the right direction for the UK government, both in terms of raising its own awareness and in building bridges with industry. However, there is still a long way to go if the UK wants to become the global leader in the secondary production of minor metals. 26 January 2011

Supplementary evidence from Minor Metals Trade Association (MMTA) (SIM 20a)

Q. What legislation is it that means you must pay £70k for a letter of acceptance to import Titanium?

The EU Chemical Directive (dubbed REACH - Registration, Evaluation and Authorisation of Chemicals) is a pernicious law that came into existence over the last few years.

It is a cradle to gave directive governing the import into the EU of all substances (with a very few strange exceptions, such as oil, coal and uranium - powerbase too big perhaps?). Pure elements, compounds, alloys have been swept into this law.

In my own case, as a small British family company, founded in 1953, with net worth £2 mln, the cost of full registration of all the elements that we have hitherto been occupied with would cost as much as the net worth of our company.

The way the law works is that for certain elements/substances which are thought not to require the later stages of evaluation and authorisation, a lead registrant must undertake, as per a consortia, to carry out certain tests on that element - mutagenicity, aquatic toxicity, carcinogenicity etc…in the example I have given of Titanium, there is a consortium of interested parties (consumers, producers etc) who will have come together to institute these tests.

These tests run into hundreds of thousands of pounds and the consortia recoups its money from others, like ourselves, who later wish to trade the metal but are not so strongly funded as to be in the consortia. In our case, we then obtain the right to trade the element via what is called a 'Letter of Access'. This price is set at a figure which relates to the overall cost of the registration, evaluation or otherwise of that element, divided proportionately by the numbers of those who wish to have access. We just asked for the cost of this LOA and it was estimated at £70,000.

I gave Titanium as an example as it is a common element needed in wide areas of UK and European industry. We trade over 20 different substances per year.

The effect of these punitive costs, apart from the reduction of the market and tendency to create monopolies (because the number of small firms like ours will be reduced) is to deter use of the metal and free availability of it in the market place, driving up costs in UK and Europe and making us (yet again) less competitive with China and other parts of the world who do not have the same standards.

All would be fine if any of us believed that the EU Chemical Directive would serve the purpose to which it was intended - i.e. protect EU Citizens lives from the inadvertent contact with harmful effects of substances.

In practice the law is just a pernicious and draconian tax, with lawyers, accountants and laboratories earning very large sums to the detriment of innovation in Europe.

When I said that I felt that this law heralded a dark age in Europe, I meant what I said. It has been the main driver in the last 5-10 years deterring investment in manufacturing and scientific use of substances in Europe.

Anything at all that could be done to mitigate or roll back this law would be in the best interests of the UK.

There is much more to be said here - about, for example, the way testing is carried out on animals quite unnecessarily because the tests themelves on some elements are 4th form science - but the law also dictates that previous knowledge on elements and substances may not be used and only new tests according to good lab practice as determined also by EU should be used.

Let me give you just one example - in the case of Rhenium, its toxicity was tested on rats in 1934, nine years after this element was first discovered and separated. This information was deemed invalid and new costly tests now have to be carried out. Translate this across to the millions (truly millions) of substances and you can see why they are building tower-blocks in Brussels to house the bureaucrats needed to implement this law.

I was one of those who represented our industry in Strasboug at the time the law was in process and no one wanted to hear our case and this law went through on a show of hands.

I have written this in haste at the start of my trading day. But it is very kind of you and your committee to be asking the right questions!

Anthony Lipmann

17 February 2011

Written evidence submitted by Anthony Lipmann, Managing Director, Lipmann Walton and Co Ltd and former Chairman, Minor Metals Trade Association (SIM 20b)

Re: Oral Evidence: Strategically Important Metals, 16 February 2011

I attach a small number of corrections to my oral evidence, which I have marked by hand in the attached hard copy.

Question73

In the heat of the moment I quoted an incorrect figure for the cost of a letter of access for the permission to import Titanium into Europe under EU Chemical Directive (Reach) legislation. The law works per substance and the cost of these letters of access vary according to a) the original cost of compliance and testing of the substance divided by the number purchasing the information b) the tonnage band in which you as the importer fall. In the above instance, and I attach evidence from Titanium Metal Consortium, our company would fall into the band of < 1000 mt which means our letter of access would cost €40,000 (Euros) and not £70,000 as I mentioned in evidence. I apologise for this error but hope that it still makes the point that, translated across numerous substances or metals, the fees are punitive. [I repeated my error under Q107]

Question 81

As I referred to JP Morgan by name, I thought best to attach an article dated 4.12.10 from The Daily Telegraph1 which refers to the matter in question. The point I was making was that at the MMTA we have rules to prevent any trading entity to also own MMTA approved warehouses as this could lead to a conflict of interest. The LME rules, which allow very large member companies, who are involved in trades on the exchange for their own account, to own LME-approved warehouses, is a conflict of interest - and is manipulative. The context of my comments was that the cause of over-priced metals is, in many instances, unrelated to any shortage in nature or production, but rather poor legislation and perverted systems.

Question 103

Under Charles Swindon’s evidence Hansard has recorded the word ‘bans’ which should be ‘bands’ - which refers to the tonnage bands which apply to the relative force of the EU Chemical Directive when applied to companies who import metals and substances into Europe. For example some metals under the EU Chemical Directive are not regulated under a band of 1 mt, and the costs of registration and letters of access alter according to whether the tonnage imported per year is > 1000 mt, < 1000 mt , < 100 mt, < 1 mt. In our case, even though we are unlikely to import as much as 100 mt of Titanium per year, we must still pay for a letter of access that applies to < 1000 mt. (see email 29.11.2010 timed 02.24 from Titanium Metal Consortia attached).2

Anthony Lipmann Managing Director

1 “JP Morgan grabs £1bn of copper reserves”, The Daily Telegraph, 4 December 2010 http://www.telegraph.co.uk/finance/newsbysector/industry/8180304/JP-Morgan-revealed-as-mystery-trader- that-bought-1bn-worth-of-copper-on-LME.html# 2 Not printed here

Lipmann Walton and Co Ltd 2 March 2011

Written evidence submitted by Chatham House (SIM 21)

1) Is there a global shortfall of in the supply and availability of strategically important metals essential to the production of advanced technology in the UK?

Much of the answer to this and following questions depends on time‐horizon (short‐ term, mid‐term, long‐term); assessments of what constitutes a strategic metal (for military applications or for broader industrial development, e.g. low carbon technologies); and global trends in economic growth and technological development, as well as developments in global politics and openness of trade.

The potential difficulties arising in the short‐term, medium‐term and long‐term are qualitatively different. In the short‐term the question is principally one of security of supply, stocks, price and possible restrictions on exports on the part of a major exporter, which becomes acute in a situation where there is insufficient diversification of suppliers. In the medium‐term the principal question is one of whether sufficient investments will take place to support supply, and whether these will be sufficiently diversified. Short‐term resource scarcity (e.g. REMs) may not be permanent if other sources are brought on‐line – but this takes time (10‐15 years at least). There is also the question of investment in potential substitutes, alternative technologies/processes and the construction of political and other alliances to achieve a reasonable confidence that the market power of any single producer has been reduced to a reasonable level. In the long‐term, genuine issues of physical scarcity apply, and the key objective becomes substitutes/processes should the problem be one of actual scarcity and, above all, the maintenance of the principle of open markets on the other, should the problem be more related to concentration of supply.

On a global scale there is no short‐term geological scarcity of metals that might be termed strategically important. Over the longer‐term, in recognition of natural global resource consumption patterns that are not sustainable, there are broader challenges relating to geological scarcity that come into play for different metals over radically different time horizons.

However, as EU and US agencies have identified in recent reports, and as Japan has directly experienced, there is a fundamental generic problem that arises from market concentration of production or processing of particular minerals. This risks politicisation, or the perception of politicisation.

The exemplar here is the apparent Chinese restriction of exports of Rare Earth Minerals (of which China is responsible for 97% of exports) to Japan. However, it is unclear whether this was a political decision in the midst of an interstate disagreement, or whether it simply reflected a lack of supply for Chinese manufacturers, or whether it is part of a broader long‐term strategy to persuade manufacturing companies to move their operations to China in order to avoid any supply interruption risk. The answer may be a combination of all three. The bigger issue may not be China deliberately using market dominance as a political tool in other areas, but simply the shift of China up the

manufacturing value chain with the consequent reduction of minerals available for export.

As with Russia’s supply interruptions of natural gas to Ukraine, it may be hard to determine a single strand of intentionality – whether genuinely geopolitical or simply commercial – in such cases. And while this matters in the short‐term it may not matter in the longer‐term. Supplier countries may ultimately lose out from supply interruptions, however motivated, if their actions are perceived to justify diversification of suppliers, or renewed investments elsewhere, or enhanced recovery and recycling programmes.

2) How vulnerable is the UK to a potential decline or restriction in the supply of strategically­important metals? What should the Government be doing to safeguard against this and to ensure supplies are produced ethically?

Britain is no more directly exposed to a potential decline or restriction in strategically important metals than other advanced economies. Indeed it may be marginally less exposed in the sense that it has a smaller advanced manufacturing sector than Germany or Japan – though this may change in the future if an economic strategy of developing low‐carbon technologies and industries is successful. Most strategic metals are imported into the United Kingdom embedded in components or finished products.

The enmeshment of global supply chains and production creates both a strength and weakness. The strength is that Britain is unlikely ever to be alone in terms of being exposed to a shutdown in the supply of strategically important metals. A politically driven shutdown would tend to involve a large number of consumer countries. The weakness of global supply and production chains, from a British perspective, is that it may be difficult to reliably identify vulnerabilities – particularly where it is not the mineral itself which is used by British manufacturing, but a mineral embodied in a component manufactured elsewhere.

On a political level, Britain would do well to build awareness and alliances within the European Union context, help craft legislation to encourage better resource use and recycling (at home and in the EU) and support diversification of supplies of minerals, particularly from reliable market‐based economies (US, Canada, Australia, Greenland) with neither political incentive nor likely economic incentive to restrict supply. Monitoring of natural resource dependencies at the European level would be useful, as would coordinated stockpiling. Britain may want to be active in establishing firmer global protocols on trade in minerals and natural resources, including those deemed strategic/sensitive. The UK/EU should develop scenarios to better understand the second and third‐order consequences of supply shutdowns, for whatever reason.

But a political/policy response should be complemented with facilitation of investment in materials’ innovation, support for recycling, and scientific research into possible substitutes. Britain’s long‐term economic future – and its relationship to many resource‐exporting countries – is linked to it scientific and technological capacities.

3) How desirable, easy and cost­effective is it to recover and recycle metals from discarded products? How can this be encouraged? Where recycling currently takes place what arrangements need to be in place to ensure that it is done cost­ effectively, safely and ethically?

The desirability of recovery and recycling depends on the metals, the costs (both economic and environmental) of recovery and recycling, the perceived criticality of the metal, and its perceived scarcity.

Some recycling and recovery may happen in the UK, but it may be equally or more important to build recycling and recovery in at the EU level, creating broader EU regulations and incentives. The Japanese approach is far ahead of the EU in this area.

4) Are there substitutes for those metals that are in decline in technological products manufactured in the UK? How can these substitutes be more widely applied?

Metals used for specific purposes are generally used because they are either the best metal to use (at that price), or because their qualities are hard to replicate or indeed unique. In some contexts substitution may be fairly easy, or may result in only minor losses in performance, which may in turn be compensated for by shifts in product design. In advanced contexts where performance has to be maximised there may be no substitutes. Research is key, not only as a means of improving UK resilience but also as a means of capturing potential economic opportunities arising from materials’ scarcity.

5) What opportunities are there to work internationally on the challenge of recovering, recycling and substituting strategically important metals?

The exchange of information on critical materials within the context of multi‐lateral organisations (NATO, EU) would appear central. Establishing broader trade protocols for natural resources offers another multi‐lateral approach, particularly through the WTO. Knowledge‐sharing in recycling techniques and regulations could prove useful.

The scale of the EU economy offers the opportunity to create a substantial market for recovered or recycled materials. At the higher end of advanced manufactured products, where it is quality and technology rather than price that affects the competitiveness of specific products it seems unlikely that additional regulation would have a strong negative impact on European competitiveness, but this would have to be substantiated by specific impact research.

Charles Emmerson Senior Fellow Chatham House

10 February 2011

Written evidence submitted by the Royal Institution of Chartered Surveyors (RICS) (SIM 22)

The Royal Institution of Chartered Surveyors (RICS) is the leading organisation of its kind in the world for professionals in property, construction, land and related environmental issues. As an independent and chartered organisation, RICS regulates and maintains the professional standards of over 91,000 qualified members (FRICS, MRICS and AssocRICS) and over 50,000 trainee and student members. It regulates and promotes the work of these property professionals throughout 146 countries and is governed by a Royal Charter approved by Parliament which requires it to act in the public interest.

RICS is grateful to the Committee for agreeing to consider its written evidence at this late stage. Given the time constraints, the evidence set out below is brief, but RICS would be happy to expand.

RICS maintains that while Rare Earth Elements are being discarded from obsolete technologies virgin material should not be harvested. RICS supports a comprehensive recycling programme to meet demand and safeguard the future of renewable energy.

Key Points:

• Many of the technologies involved in the green schemes encouraged by Government depend on rare earth metals • Rare earth metals may become more difficult to obtain as the country that dominates the market, China, is introducing a policy of restricting production and exports via a system of tariffs and quotas • Scarcity of resources is one problem, the association of mining with environmental degradation is another limiting factor • Saving the planet through alternative green economies and technologies calls for more access to rare earth metals which in turn could mean more damage to the landscape, more environmental degradation and more loss of wildlife habitats • Evidence from the UN suggests that recycling rare earth metals is twice as energy efficient as extracting metals from virgin ores (and in some circumstances ten times more efficient). It may also go some way to keep metal prices down and generate new employment • Abundant quantities of rare earth metals exist ‘above ground’ in the form of obsolete consumer technology, with an estimated 30 million computers and laptops containing these metals currently lying unused in the UK • RICS maintains that there is an opportunity to harvest rare earth metals present in the Waste Electrical and Electronic Equipment Directive (WEEE). All items under the Directive could be assessed for the presence of these metals and where present should be recovered and returned to the production process. This would require stricter enforcement of the Directive • Efficient recovery and re-use of rare earth metals needs to be promoted particularly as the metals are used as a foundation material of most renewable energy technologies.

Royal Institution of Chartered Surveyors

28 February 2011