We’re talking about Northern Minerals (NTU), which has just released its definitive feasibility study on the Browns project, in Western Australia close to the Northern Territory border.

The valuation reflects the decline of investor confidence since the rare earths bubble of 2011. The good news is that the tide seems to be turning, that at least some of the demand destruction that took place in 2011-12 (when buyers, mainly Japanese, baulked at the absurd prices being demanded) is now being recovered.

The market remains opaque, but some reports have it that there have been good gains in some of the heavy rare earths (always the most valuable ones), with terbium having climbed nearly 50 per cent since November and dysprosium more than 20 per cent. European prices have also gained of late.

It seems, too, that China has resumed stockpiling rare earths, especially the heavies, and despite the World Trade Organisation, Beijing remains able to regulate the quantities being exported.

For more than a decade, the mantra of the rare earths trade was about reducing what was almost total global dependence upon China. But China still dominates, and many of the non-China players have woven strong connections with partners from that country. While these companies will mostly be able to determine their own supply agreements, there seems little doubt they are operating within the Chinese rare earths industry orbit, and China wants to remain the dominant player. Even the largest non-China player (and producer), Molycorp in the US, has a market cap of just $US208m ($266m). Second place is Lynas Corp (LYC) at $175m.

Northern Minerals seems to be emerging as a lead player, mainly due to the composition of its deposit. While the mines operated by Molycorp and Lynas are dominated by the less valuable rare earths elements — especially cerium, which is in little danger of being in shortage in the near future — NTU’s deposit is an exception, with a large preponderance of the heavy elements.

The big selling point is the 8.79 per cent content being made up by dysprosium, used in magnets for electric vehicles, wind turbines and electronics. More than half the deposit consists of yttrium which, while not nearly as valuable, is linked to the vital LED lighting and optical fibre industries.

NTU’s main shareholder is the company 45 per cent owned by executive chairman Conglin Yue, who has ties with important Chinese companies. Now Shanghai-based Jien Mining is coming on board with a $49.5m investment.

For all the problems and lack of interest in the rare-earth sector, the key players are making real progress.

Greenland Minerals & Energy (GGG) is nearly finished its feasibility study on the Kvanefjeld rare earths and uranium deposit in Greenland. Again, with the China connection: the company has a deal with Hong Kong-based Long State Investment, with a group of Asian investors having agreed to take up new shares to the value of $20m. But even with its 1 billion tonne resource, and with the focus on the more sought-after elements such as neodymium, praseodymium, europium, dysprosium, ¬yttrium and terbium, GGG is reckoned by the market to be worth only $39.5m.

Next most valuable is Hastings Rare Metals (HAS) at $28m. It is drilling away in Western Australia chasing the magnet materials neodymium and dysprosium, a market that is growing by 10 per cent a year. The largest shareholder is Singapore businessman and executive chairman Charles Lew.

At $24.3m is Arafura Resources (ARU) with Nolans in the NT. The value of its basket of rare earths shows the blows the sector has faced. In 2011, its basket was worth $US153.58 a kilogram; in 2014 that same basket was worth $US29.47/kg. This company is 25 per cent owned by East China Geological and now is also teaming up with Shanghai’s Shing Kang NingMining.

Worth $26m is Peak Resources (PEK) with its Ngualla project in Tanzania, highlighting its magnet materials praseodymium and neodymium, but now also stockpiling cerium. It expects to be producing by 2018.

If rare earth prices do maintain their fightback, it might signal the sector has reached a more sustainable level. By the way, we haven’t included Alkane Resources (ALK)because, although it is making progress with its Dubbo rare-earth projects, its success as a profitable goldminer muddies the valuation picture. For the record, it is capped at $153m.

Gippsland hopeful

FOR years, the eyelids tended to droop when an announcement lobbed fromGippsland (GIP). Considering that the company announced its acquisition of the Abu Dabbab project in Egypt on October 3, 2001, investor (and this writer’s) interest expired some time ago, and it’s nearly two years since the shares saw 1c (they closed Friday at 0.3c).

GIP had a good story — tantalum, tin and feldspar — but it was one seemingly without a happy ending. The latest hurdle was a poor reaction to a development plan that involved spending $US140m.

Instead, the junior has now decided on a more modest start, a spend of just $US7m that will see first year production of 92,000 pounds of tantalum and 260 ¬tonnes of tin. Under a conditional deal, an Egyptian businessman operating through his Taiwan-based company will come up with the readies.

Then, in the second year, the plan is to invest another $US28m to lift output to 400,000 pounds and 960 tonnes respectively, along with 1 million tonnes of ceramic grade feldspar a year over a 25-year mine life. The Egyptian businessman will gain 50 per cent of the project.

But two further pieces of good news for GIP: last week it successfully closed a rights issue, raising $1.04m and also, if all goes according to plan, production is to begin early next year.

Moreover, London’s Capital Economics is holding its nerve on tin and still expecting $US23,250 a tonne by the end of the year (against Friday’s close of $US18,100/tonne), saying that mine output in China, Peru and Indonesia will fall and it will be into next year before new projects in Brazil, Australia and Morocco held fill the gap.