Nebraskans near Niobium find consider economic benefits of mining

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April 18, 2011 - 7:00pm

Sitting all by itself on the tarmac at the Beatrice, Nebraska airport, the blue and white Cessna Grand Caravan rocked back and forth in the 30 mile an hour winds. Inside was electronic equipment so sophisticated, special permits were needed from the Department of Defense to use it on this mission. The two person flight crew waited. Again. The two Canadians had been hired to fly over a 10 square mile patch of rolling farmland in southeast Nebraska. When done, the magnetic and gravitational fields they measured will provide a new, detailed map of the mineral deposits below. It can't happen now. Software problems followed by bad flying weather made their job nearly impossible for the last five days.


Click on the image above to see a Google map of the area.

The plane equipped with magnetic and gravitational field sensors sits on the runway in Beatrice, Nebraska. (Photo: Bill Kelly/NET News)

High quality Niobium is currently mined only in China, Brazil and Canada. (Photo courtesy KIMreport.com )

There were a lot of people waiting for them to finish their work. A company executive in Vancouver, British Columbia hoped to have the results of their survey three days earlier. So did a bunch of farmers in Nebraska. Everyone wants to know the size of the Niobium deposits that have been sitting under the topsoil here for tens of thousands of years.

The Niobium and other rare earth elements were discovered here in the 1970's. The mining coming that found it elected not to dig it up. Now those minerals are in demand. Niobium is used to make light-weight steel super hard. It's used in jet fighters and electronic components and hardware used by body piercers. Currently all of it is mined in China, Brazil and Canada. The American defense industry believes it's important to have its own supply. They may have found it under the farms outside of the town of Elk Creek, Nebraska, population 116.

Fortunately for everyone, that high-tech laden small plane, made it up a few days later to finish analyzing the minerals below.

"I don't know what's underneath us now," says Harlan Beethe. He's own his tract of farmland for 17 years, but his family's had land here for over a century. It appears that most of the Niobium deposits are to the east of his land, but the surveyors are taking another close look since "this section here hasn't been explored very much.







Niobium is the talk of Elk Creek, Nebraska

It may have been "out of the blue" in his words, but Beethe and the neighbors were not entirely surprised when a couple of representatives from a company in Canada knocked on the front door last year. "They just came in one day and were looking for a release on the ground." They were representatives of Quantum Rare Earth out of Vancouver. The price offered was fairly low, according to Beethe and others. No one signed up immediately and negotiations have ended up providing most with deals that they are satisfied will adequately reimburse them first for the rights to explore and, if the surveys show the deposits are underneath their land, pay for the right to take the Niobium away.

"There were a lot of sleepless nights believe me," said Peter Dickie, the CEO of Quantum. His quick and quiet efforts lined up exclusive rights to the minerals ahead of several competitors. "We were in a race with other entities," Dickie told NET News. "We have spoken with a couple of very, very substantial entities since we announced the project and I can't quite say the language they used on the phone, since it's not for a family audience, but they were jealous that we had jumped on it."

The prospect for a Niobium mine being dug, quite literally, in their back yards brought dozens of people to a meeting at the volunteer fire department in Elk Creek on a blustery day in March. In a room full of Carhartt coveralls and seed corn caps, Peter Dickie looked just a bit out of place in his European loafers. He was surrounded by a small group of farmers asking once question after another "Is it possible that there is a larger area that hasn't been explored?" We have to wait for the survey, Dickie patiently explained.

He was much more encouraging when he spoke everyone on hand . "I hope we can prove up a project that can provide a major economic shot in the arm to this part of the state and the state in general," he told the group, which responded with an enthusiastic round of applause.

Later, sitting in his rental car with a reporter, Dickie was more cautious about the prospects for anyone person in and around the area being explored. "To be perfectly honest with you some people will feel disappointed in the end," he said. " It's a matter of luck in some cases."

Since it's not just one seamless area of the Niobium and other elements, there are some who will benefit, but "if their property happens to be half a mile away outside of the ore body, whatever funds they have received to date to allow us to explore it, that will be the end of it."

If Quantum finds the deposit is big enough and of high enough quality to go after and if they find the investors to underwrite the development, a mine would be a substantial boost for a rocky economy in this corner of the state. "It's a big boom. It's huge," says Doug Goracke, the director of Economic Development projects for Tecumseh, Nebraska. His town is about 10 miles north of Elk Creek, but he says the entire county could benefit. "We know Elk Creek, Nebraska doesn't have housing. They don't have some of the services that we have." Goracke and the business leaders in Tecumseh are already talking about what they could do to meet the demand.

Hopes for a windfall are tempered by this area's past experience with big promises of jobs and development. First, there's the memory of Molycorp, the Niobium prospectors who came and went in the 80's. More recently is Tecumseh's experience getting the big new state prison. The community lobbied hard and beat out a number of other Nebraska cities to become the correctional centers home. Now that it's built, it did help out the area economy, but it failed to bring the big benefits for Tecumseh itself. In an environment of high expectations, Quantum's CEO Peter Dickie knows if this project doesn't through "it will be tough and unfortunately, this community went through it once before."

None the less, everyone in the area wants to know what the geologists will say when they complete the latest round of surveys.

All this is why the results of the survey underway now are so important to southeast Nebraska. "This survey will tell a lot," according to Goracke."If that is very encouraging I anticipate conversations about roads and bridges and things like that will take off rather quickly."

There are other delays that could delay providing all the answers everyone hopes to hear. The latest round of test drilling was supposed to have begun a couple of weeks ago. No word yet on when it gets underway.

Meanwhile, with spring finally here, Harlan Beethe is preparing his farm machinery for planting. This spring in Johnson County, the talk seems to be evenly divided between what's in the soil and the minerals buried 500 feet below it. When you ask Beethe what he knows about Niobium, he just laughs and adds "not much. I just know what I've been told and that's not much."

If things work out the way he hopes, Harlan Beethe and a lot of other Johnson County residents are going to become experts in Rare Earth Elements.

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