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Jack Lifton

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  • A Reality Check for Wind Power Investors [View article]

    In the stream of comments to your articles I have discovered the universal error of those who disagree with your facts and logic. Most of your detractors do not believe that our society requires wealth creation to balance the flood of symbolic paper obligations (currency) that can be printed on demand.

    They seem to believe that the failings of their pet technologies to be economically realistic will be corrected by simply being economically unrealistic. Infinite capital will be expended to achieve eco-religious goals.

    The invention of coined money in Anatolia around 2700 years ago has, since that time, been consistently mistaken for the creation of wealth by people who don't understand that money is a human "invention" designed to make long distance trade smoother. Money is an idea, represented by paper and metals. The idea is one of future obligation to honor debts both in services and in kind. As we waste this facility for trade so must we reap a future where we can make no new promises to repay until we have balanced our books.

    Every "penny" wasted on uneconomic alternate energy is a future less bright for our children who will be called upon to repay our debts by lowering their standards of living unless they have learned once more to create wealth.

    I have begun to pity those who blindly follow the braying "leaders" of our time whose ignorance of economics is even greater than those they lead.

    Thus endeth the sermon
    Apr 7 09:15 AM | 12 Likes Like |Link to Comment
  • EV Dreams And Industrial Metal Nightmares [View article]

    You can't be right, because you're saying that to save the environment for the 99% we would first have to produce all of the world's accessible fossil fuels in order to produce the critical metals to produce and utilize the specific critical metals for alternate energy production and use. Fortunately for the eco-elite probably we'd only be able to produce enough of the metals by using so much fossil fuel that the prices of oil, coal and gas rise for everyone thus having all of us, the 99.9%, pay for the Eco-bling.

    You seem to be saying this, but I must be wrong, because that would mean that our wise elites are economic illiterates with no knowledge of resource production limitations or energy economics.
    May 6 09:32 AM | 11 Likes Like |Link to Comment
  • Rare Earth Elements' New Trend [View article]
    Does anyone understand how difficult it would be for the two largest solvent exchange rare earth separation plants ever constructed; one in Malaysia, apparently of 11,000 tons yearly flow through capacity, and one in California, apparently larger than that, to be built charged with solvents, tested and put into full production in less than 2-3 years? Apparently not.

    This author seems to confuse rare earth ore concentrates containing the equivalent of, say, 10,000 tons of rare earth oxides "equivalent" with 10,000 tons of separated commercially pure "oxides."

    Mechanically concentrated rare earth ores can either be stockpiled, or sold to China, until the capacity exists to separate them outside of China. Molycorp admits that its total separation capacity today, if the old Mountain pass plant is still running, is, with Silmet, some 6,000 tons in all.

    The question to ask is WHEN will Molycorp and/or Lynas have operating new solvent exchange capacity to produce 99.99% lanthanum oxide and cerium oxide and 99.5% neodymium oxide, not didymium.

    Until they know the date that their new capacity will come on line and be fully operational all either company can do is mechanically concentrate ore, and in Molycorp's case, extract the rare earth values from the concentrate to the capacity of their existing separation facilities.
    Aug 27 05:59 PM | 11 Likes Like |Link to Comment
  • Molycorp Looks Too Good to Pass Up [View article]
    I wish this author and many others on SeekingAlpha would learn the definition of new "production" in mining. In the case of rare earth mineral mining it means mining, mechanically concentrating, and chemically extracting the desired metal values into a chemical solution. I have seen no announcement from Molycorp that it has done the first two of those steps since its predecessor in interest last did that in the late 1990s or very early 2000s.

    My understanding, and personal observation in 2009, is that Molycorp is chemically extracting metal values from mechanically produced ore concentrates last created in 2002 at the latest.

    I also understand that Molycorp is running material through the re-activated original separation plant, which the new owners bought, as part of the mine, in 2007-8.

    Please point me to an announcement that Molycorp is newly mining and concentrating ore and that this ore is being chemically extracted and fed into the separation plant. You may then speak of "production."

    Until then the company is working through previously concentrated material of indeterminate age.It is interesting to note that this previously concentrated material was of so little value in 2002 that the freight to get it to China was apparently so high that it was uneconomical for the Chinese to buy it from California. This means that in or before 2002 it was possible to mine and mechanically concentrate rare earth mineral in Bayan Obo cheaper than to send ore concentrates to Bayan Obo from California even though American mining, especially of the open pit type as here, is the most productive and least labor intensive in the world.. Is it still the case in 2011 that Chinese overhead is lower?
    May 23 02:43 PM | 11 Likes Like |Link to Comment
  • White House Report: GM Volt Is Not Ready for Prime Time [View article]

    Once again you have hit the nail on the head. Li-ion battery technology is not today economical, and no one can say that lithium-ion technology is the final step, or even a good step, at this point, in the devlopment of a practical economcal storage battery. This has nothing to do with either the price of lithium or its availability yet these two factors are repeatedly invoked as market drivers. As you have said and proved above the politicians have conributed mightily to the creation of fantasy battery standards that are on their face suicidal to any hope of the future development of a practical lithium-ion battery.

    As I keep saying, myself, accelerated testing as a standard for batteries is nuts. Battery electrochemistry and materials engineering is as much an art form today as a science. The most reliable way to meet a ten year warranty standard for a battery is to test it in real time for ten years! This means that even if the perfect technology were "discovered" today, we would not know it for ten more years! The costs of betting on any one technology to meet this standard for any company are astronomical. You would be betting the company on such a test, and you wouldn't know if you were going to have a failure until the entire 10 years had passed. Batteries are dynamic systems. They change over time. They are being addressed by politicians as if they were static systems, which don't change over time. What doesn't seem to ever change is the use of hype to inflate dreams until they burst.

    Apr 24 09:09 AM | 11 Likes Like |Link to Comment
  • The Current U.S. Economic Scenario: Where We're Headed [View article]
    In this morning's Wall Street Journal an author points to the tendency of government political appointees to fail ever upward in their career paths. I use to think that most government failures were due to ignorance by "leaders" and lack of specific expertise in their subordinates. I have come to believe now that this ignorance is mostly do to an overall lack of intelligence by a power-greed driven group that has taken over the national government. Hollywood on the Potomac is all smoke and mirrors and its moral decay is palpable.
    Nov 12 09:29 AM | 10 Likes Like |Link to Comment
  • Understanding Manufacturing Economics For Grid-Scale Energy Storage [View article]

    As an MIT professor of mathematics once said "All innovation comes from the depths of the human mind and then we figure out how to get a machine to do it."
    This is a first-class example of ingenuity finding a solution. Its actually the realization of the "smart grid" with the caveat that it must make a profit from the first day, so that it must, by that necessity, be limited in scope. At the risk of insulting some of the existing 1% (whose ranks we all dearly want to join) I would like to say that all of the politicians nonsense about a massive smart grid built upon a trillion dollar network that doesn't exist are put to shame by this venture.

    Now if only someone could explain the economics of life to a president who asked Steve Jobs "when can these (computer assembly) jobs come back to the USA (from Apple)?" The answer was "Never."
    Jan 24 09:06 AM | 10 Likes Like |Link to Comment
  • Thoughts on the Low Pricing of Rare Earths in China's Domestic Market [View article]
    I will comment on one point:

    When I was last at Mountain Pass in June, 2009, there was just one employee remaining, a very senior engineering one, who had been there continuously for 28 years. He was in charge of the re-start of the separation plant, which, between 2007 and June 2009 had been successfully ramped up to produce two tons a day of didymium, a trade name for a mixture of 80% neodymium and 20% praseodymium, in oxide form. Additionally the plant was producing four tons a day of lanthanum oxide. I saw supersacks each containing 500 kg of such products being filled and I saw some warehoused stocks.

    I did not see nor did I ask about cerium production. I was told that in June, 2010, the separation plant would have advanced to the recovery of samarium. No mention was made of any other rare earth element, although an engineer pointed out to me that any europium in the ore would normally come out with the samarium and would then be separated by further small scale laboratory size operations.

    I observed a newly lined residue "pond" and a Butler-building type of warehouse holding a large quantity of previously beneficiated (mechanically concentrated) ore that I was told was then or had been recently 22,000 metric tons of 70% concentrate.

    I observed no excavating or large transportation equipment on site. The conveyor was newly painted but did not seem to have been running for some time.

    The personnel were friendly, hard working, organized and competent.

    We did not discuss at any time during that visit any environmental issues or timelines for resuming operation. There was no plan at that time, or at least no plan was being discussed, to do an IPO. As I recall it was mentioned that a target date for an IPO of 2012 seemed realistic.

    I recall being asked for my views on the marketing of the products.

    I also recall that the open pit mine had water pooled at the bottom which was being sent by pumps to an evaporator releasing a plume of white steam into an otherwise empty desert sky.

    I don't know how many former Molycorp employees have returned or been brought back as mineworkers, separation plant workers, and supervisors. I do know that Molycorp has brought back some former skilled workers, engineers, and scientists.

    To me the unfortunate aspect of the publicity blitz about this operation is that it has been made to look like restarting a mine is like starting a car that has been laid up on blocks for a long time. In fact it is more like trying to start a car that no one present has ever seen run and to understand that there may be improvements in the equipment and/or the operating procedures that will now have to be incorporated so that they will have to be tested before the car can be taken out for a spin. Additionally there may be some new rules about the environment and safety that have to be addressed.

    With the best intentions and the greatest skills available all of this takes time as well as money.

    If I fault Molycorp management it is for its enthusiasm with regard to the ease of tackling all of the problems involved in a re-start while simultaneously announcing an increase in planned production to an all time (world) record for a single mine.
    Mar 12 10:10 AM | 10 Likes Like |Link to Comment
  • Plug-In Vehicles: The First Great Fraud of the New Millennium [View article]

    I once (actually) heard (on a tube type radio in the early 1950s)Bertrand Russell say that he had lived so long (He was nearly 90 at the time) that his philosophical opinions and "observations" had been accepted during his own lifetime. I hope that you attain to his age and lucidity at that age, because it may be the only way to vindicate your prescient analysis of what you so rightly describe as one of the great "frauds" of our time.

    In fact, the overarching fraud is that consumption (demand) begets supply. This could only be true in a world of infinite resources, in which world so many of your auditors and interlocutors seem to reside. The ancients called it cloud cu-cu land. I call it the world of non-Aristotelian logic.

    The profligate waste of resources party may be over, and, if so, I fear the hangover as the reality of material limits pushes politicians and financiers into greater and more destructive methods of stealing from the future to ensure their own, and only their own, present.

    You're right on the money, John. Keep up the good work.

    Mar 16 09:43 AM | 10 Likes Like |Link to Comment
  • Don't Believe the Biofuels Brainwash [View article]
    Mr. Fessler,

    I follow your work on SA, because it always makes sense. I note that you say, with regard to the expiration of a biofuels' subsidy that is upcoming, "However, some members of Congress are trying to reinstate it. One can only hope that saner heads will prevail."

    Even contemplating such a renewal at this point is not just insanity it is also evidence of a pervasive corruption of the political process by money and a collapse of any minimum standard of intelligence and reasoning ability formerly required to qualify for service in the national legislature.

    Biofuels are garbage, literally and figuratively.
    Mar 7 10:20 AM | 10 Likes Like |Link to Comment
  • Fundamental Differences Between Energy Storage and Other Sectors [View article]

    I sincerely feel your pain. As you are in energy storage I am also a "booster" of natural resource conservation in my work as a natural resources market fundamentals and end uses consultant. I have been called a "strange" environmentalist by The Atlantic Monthly, but, as you are in energy storage, I am a true champion of rational progress within our economic limitations. What I cannot abide in the hype and short term thinking that wastes our limited resources of capital along with our irreplaceable intellectual capital chasing financial gain for the moment without measuring the long term costs and liabilities incurred by all us of that chase.

    To a future of the rational economic uses of natural resources to create the best life that as many of us can enjoy as possible,
    Jan 31 08:37 AM | 10 Likes Like |Link to Comment
  • Why Rare Earth Prices Are Poised To Rebound And Who Stands To Benefit [View article]

    I think you are correct in identifying the key issues.

    Essentially all of the world's rare earth permanent magnets are made in China and Japan. The Chinese rare earth industry believes it will NEVER have to import neodymium, praseodymium, or samarium. The Japanese, on the other hand, know they will ALWAYS have to import all of the rare earth elements they use. Lynas' ore is much richer in neodymium/praseodymium than Molycorp ore. This means that Lynas can produce LESS TREEs and get MORE Nd and Pr per unit of finished material. Lynas' production target could meet more than 50% of Japan's domestic demand for Nd and Pr. Molycorp could provide the rest, but there are two problems facing both Molycorp and Lynas.
    1. Molycorp has significant refining and manufacturing operations in the PRC. These operations are constrained to operate under Chinese environmental, legal, and import/export rules, and
    2. Japan is well advanced in developing its own rare earth supply chains in Southeast Asia, India, Africa, and Canada. Any Japanese successes will have a negative impact on both Molycorp and Lynas.
    Articles about the REEs markets that ignore the global picture, as almost all SA articles do should not be anyone's sole reason for investing in the REE space.

    Dec 9 09:47 AM | 9 Likes Like |Link to Comment
  • It's Time To Kill The Electric Car, Drive A Stake Through Its Heart And Burn The Corpse [View article]

    An outstanding essay. Definitive and certainly among your best on this very important topic, if not the best ever written by anyone on this topic. The World Energy Council certainly made a good choice.

    It boggles the mind to think that the problem with natural resources will be the ability of the current population of the western world to hold on to its per capita usage even as the number of people who want to be on that level doubles or triples. I don't see how it will be possible, and I don't see how to avoid a decline in the American standard of living as the global rate of the production of all metals fails to keep up with the rate of growth of Asian GDPs.

    Aug 25 01:34 PM | 9 Likes Like |Link to Comment
  • Molycorp Looks Too Good to Pass Up [View article]

    Be aware that Silmet is just one of several companies in Europe that have the skills to separate and refine rare earth ore concentrates into metals. Rhodia of France for example has separation and refining facilities in France that are shut down today for economic reasons-it is cheaper to obtain and process feedstock at Rhodia's Chinese facilities than in France SO FAR! There is also Treibacher in Austria, the modern company built upon the work of Auer von Welsbach the man who invented the first commercial use for a "rare earth" material. I believe that Treibacher has been in buisness for more than a century. There is also Vakuumschmeltz in Germany; this was formerly a Siemens company. It was bought out a few years ago by the employees and continues to supply Siemens with rare earth products. Finally there is Great Western's subsidiary, Less Common Metals, which today produces magnet alloys, and will by 2015 be, in my opinion Europe's largest producer of magnet alloys.

    There are many rare earth mining ventures in the non-Chinese world, and some of them will go into production.

    The key limiting factors for that production will be refining capacity and metal alloy fabricating capacity.

    The largest separation plant for rare earths so far constructed has a yearly capacity of 10,000 tons. I don't believe that Molycorp's existing capacity is that alrge, and to build separation and refining facilities for 40-50,000 tons/year of REEs is a monumental undertaking never before done anywhere. Ob top of that Molycorp's 50,000 tons will include some 8,500 tons of neodymium, which is sufficient to produce some 29,000 tons of neodymium-iron-boron magnets albeit without any dysprosium. This is nearly one-third of today's rare earth permanent magnet market. These are both very tall orders to be accomplished in the company's published timeline.

    I wish them luck.
    May 23 04:17 PM | 9 Likes Like |Link to Comment
  • Wind Power Investors Get Another Reality Check [View article]

    I'm glad you said that. I attended a workshop on critical metals in Washington, DC, last week and the PhD participants were all over themselves reinforcing their own economic bullshit. I then realized that all of these academics and think-tank pundits feed from the same trough, and that since none of them knows from where the food comes they fear to anger the masters of the slop supply.

    Their arguments are now of the shoe size of the angels on the head of a pin variety. They wildly miss the key points.
    Apr 10 10:24 AM | 9 Likes Like |Link to Comment