A Nevada mining company claims to have discovered the highest-quality deposit of rare-earth elements in the nation at the far south end of the Bitterroot National Forest.
U.S. Critical Materials Corp. bills its Sheep Creek holdings as "one of the highest-grade light rare earth projects in the U.S.," containing "at least 12 of the critical risk elements as defined by the U.S. Geological Survey." Key elements at the site are neodymium and praseodymium, according to the company. Both elements have a wide variety of uses, sometimes together, including in electric vehicles and in making exceptionally strong, tiny magnets inside electronics.
Sheep Creek is about 13 miles south of Painted Rocks State Park and about 36 miles south of Darby, immediately north of the Montana-Idaho border. The company holds mining rights on 223 claims around Sheep Creek. The claims total more than 4,500 acres, or about 7 square miles, of U.S. Forest Service land, according to the company. The creek drains north into the West Fork Bitterroot River.
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The deposit also contains lanthanum, cerium, europium, gallium, niobium, yttrium, scandium, dysprosium, strontium and gadolinium, according to the company. The elements are often found in conjunction with thorium, a radioactive element. U.S. Critical Materials states that there's not enough thorium at Sheep Creek to require permitting from the U.S. Nuclear Regulatory Commission.
"The high-grade rare-earth indications together with the low thorium readings are a unique combination," James Hedrick, the company's president, said in a statement. "I believe that U.S. Critical Materials Corp. has the potential to be a top U.S. rare-earth producer."
The company’s exploration so far has been conducted under a 2022 exploratory permit from the U.S. Forest Service. Ed Cowle, director of U.S. Critical Materials Corp, said in an interview Wednesday that he hopes a project on the site would be operational in four to five years. A mine at the site could be open-pit, underground or a combination of both, he said, adding that the company hadn’t yet made that determination. Ore would be processed nearby, he said.
The company's origins stretch back about 20 years to prior ventures between Cowle and CEO Geoffrey Williams. The pair originally staked thorium claims around the West and found rare-earth elements alongside thorium deposits. But “things went bad with rare earth” in the U.S. around 2013, Cowle said, when "China flooded the market, the prices crashed and we basically got out of it."
With growing demand for rare-earth elements and a push from the U.S. government to produce renewable energy and electric vehicles using domestic materials, they revisited their rare-earth claims and determined Sheep Creek was the most promising. They founded U.S. Critical Materials two years ago to hold the claims, and amassed more claims.
"We just got as many claims as we could so we would not have competition at the heart of the property,” Cowle said. That heart features multiple historic adits – tunnels into a hillside – that extend 400 feet and reach a depth of 125 feet below the surface. Miners opened two of them in October. Inside, they found carbonatite formations holding rare-earth elements. Sample testing showed unusually high percentages of rare-earth elements and unusually low amounts of thorium, he said.
Rare earth mining typically involves excavation of ore-bearing earth followed by chemical leaching in on-site ponds, or by pumping leaching chemicals through pipes directly into the ore beds.
"Both methods produce mountains of toxic waste, with high risk of environmental and health hazards," according to a Harvard International Review report. "For every ton of rare earth produced, the mining process yields 13kg of dust, 9,600-12,000 cubic meters of waste gas, 75 cubic meters of wastewater, and one ton of radioactive residue. This stems from the fact that rare earth element ores have metals that, when mixed with leaching pond chemicals, contaminate air, water, and soil."
Cowle acknowledged there are environmental concerns surrounding mining, particularly for rare-earth metals. He highlighted the Sheep Creek deposit’s lack of thorium as one reason an operation there could be less harmful than other rare-earth mines.
"I think we’re far enough from the river, I think we’re far enough from people,” he said. “Montana is mining-friendly, and I think they’re going to see rare earths mined as environmentally friendly as they can be. There’s always going to be opposition. People can come from California, from New York, from any place, to oppose it.”
But, he added: "There’s a lot of government necessity” for the elements at Sheep Creek, and government support for extracting domestic deposits of the elements. And, he stressed, "We’re just so convinced, especially Jim Hedrick … he is just convinced that this is the leading deposit in the United States, actually North America.”
In a Jan. 31 news release, the company stated that the average 9% total rare-earth oxide composition of the Sheep Creek deposit far exceeds the percentage of rare-earth elements found anywhere else in the U.S.
"We have confirmed that Sheep Creek is the highest-grade rare-earth deposit in the United States, with a multibillion-dollar resource value," Hedrick stated in the release. The company stated that the elements found at the site are "needed for the world’s evolution toward electrification and a 'green economy.'"
U.S. Critical Materials holds its mining claims with a sister company, U.S. Rare Elements Corp. U.S. Critical Materials was registered in Nevada on April 20, 2021, according to the Nevada Secretary of State. U.S. Rare Elements was registered in Nevada on July 26, 2022. Hedrick, a former rare-earth commodity specialist for the U.S. Geological Survey, is listed as president of both companies. Geoffrey Williams is the CEO and principal investor in U.S. Critical Materials, according to the company's website.
The website describes U.S. Critical Materials as being based in Salt Lake City, Utah. But the company isn't registered to do business in the state; it is based in Nevada. U.S. Rare Elements is registered in Utah as an out-of-state corporation based in Nevada. U.S. Critical Materials states that a third company, U.S. Critical Metals, is a minority partner. U.S. Critical Metals is not registered in Utah or Nevada, according to each state's secretary of state.
Cowle said that "80% of corporations in the country are (registered in) either Nevada or Delaware. It’s formed in Nevada and we follow Nevada corporate law. We have our physical operations in Montana and we have our offices in Salt Lake City. We’re Salt Lake-based and we’re on the ground in Montana, and we’re about to spend a lot more money in Montana this spring and summer.”
It is too early to speculate how many people a future mine might employ at full production, he said, or for how long a mine could be in production. But, he noted, at least 10 to 15 people will be employed this summer between drilling, mapping and staking.
"We will be submitting a plan of operation shortly for drilling this year,” he said. "We have Montana politicians and public servants saying they’ll be able to help us with the Forest Service. But the Forest Service's job is to make sure things are done right, make sure the land stays as pristine as possible. We’ve had a very good relationship so far, but I can’t predict the future.
“They’re not looking to stand in someone’s way, but they want to see it done right. And we will cooperate 200% with the Forest Service to make sure our goals and objectives are the same.”
Dan Pliley, the West Fork District ranger for the Bitterroot National Forest, was not available for comment on the project. Tod McKay, the forest's public affairs officer, did not return a voicemail seeking comment Wednesday.