Wikipedia

MP Materials

MP Materials Corp. is an American rare-earth materials company headquartered in Las Vegas, Nevada. MP Materials owns and operates the Mountain Pass mine, the only operating rare earth mine and processing facility in the United States.[10] The rare earth materials industry is dominated by China, which produces 60% of the world's rare earth elements and processes 90% of these materials, including imports from other countries.[11] MP Materials focuses its production on Neodymium-Praseodymium (NdPr), a rare earth material used in high-strength permanent magnets that power the traction motors found in electric vehicles, robotics, wind turbines, drones and other advanced motion technologies.[12] MP Materials is listed on the New York Stock Exchange under the ticker symbol "MP". As of December 2021, JHL Capital Group, QVT Financial and CEO James Litinsky were the company's three largest shareholders, with about 7.7% of the company owned by Shenghe Resources, a Chinese company partly owned by the country's Ministry of Natural Resources.[13]

MP Materials Corp.
Company typePublic
Industry
Founded2017; 7 years ago (2017)
Founders
  • James Litinsky
  • Michael Rosenthal
HeadquartersLas Vegas, Nevada, U.S.
Area served
Worldwide
Key people
James Litinsky
(Executive Chairman & CEO)
Michael Rosenthal
(COO)
ProductsRare earth concentrates,[1] metals,[2] and neodymium magnets[3]
Production output
38,500 tonnes[4] (2020)
OwnerJHL Capital Group, QVT Financial LP, James Litinsky, Shenghe Resources[5]
Number of employees
681[6] (2024[7])
Websitempmaterials.com Edit this at Wikidata
Footnotes / references
[8][9]
Mountain Pass mine, aerial view

History

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In 2015, Molycorp, the previous owners of the Mountain Pass mine, filed for bankruptcy. At the time, it was the only U.S. producer of rare earth elements.[14] While in bankruptcy, Secure Natural Resources (SNR), a company owned by Molycorp's creditors, including JHL Capital Group, gained control of the mine's mineral rights.[15] In June 2017, the Mountain Pass mine was purchased at auction for $20.5 million by a new entity called MP Mine Operations LLC (MPMO).[16] MPMO was a consortium formed principally by JHL Capital Group, a Chicago-based investment firm led by James Litinsky, along with QVT Financial LP and Shenghe Resources.[17] Shenghe Resources held a minority, non-voting interest.[18] At the time, Mountain Pass was in a state of "care and maintenance" and had only eight employees according to Litinsky.[19]

Following the asset acquisitions and formation of the entities that became MP Materials, the company restarted operations at Mountain Pass. On July 15, 2020, the company announced a reverse takeover whereby MPMO and SNR would be merged with Fortress Value Acquisition Corporation to become a public company under the name MP Materials Corp. The transaction, which closed on November 17, 2020, raised $545 million.[20] On November 18, 2020, MP Materials began trading on the New York Stock Exchange under the symbol "MP".

In December 2021, MP Materials signed a long-term agreement with General Motors to provide neodymium-iron-boron magnets for use in GM's electric vehicle motors.[21] As part of the contract, MP Materials also agreed to provide alloy and finished magnets to GM for its electric vehicles[22] and to open a new factory located in Fort Worth, Texas to produce the magnets.[23]

As of December 2021, JHL Capital Group, QVT Financial, and CEO James Litinsky were the company's three largest shareholders, and about 7.7% of the company was owned by Shenghe Resources.[24][25][26][27][28] Apart from institutions, other investors own 18%.[25]

MP Materials and Australia's Lynas held a confidential discussion regarding a potential merger which fell through on February 5, 2024.[29] Lynas is the second largest rare earth material company outside of China.

As of 2024, CEO James Litinsky was the company's largest shareholder.[30] Other large shareholders include Vanguard, Shenghe Resources, BlackRock and Hancock Prospecting.[30]

In April 2024, Hancock Prospecting, an Australian mining firm owned by Gina Rinehart, disclosed a 5.3% stake in MP Materials, comprising 8.8 million shares, and a 5.8% stake in Lynas.[31][32]

Mountain Pass mine

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Mountain Pass mine
Main article: Mountain Pass mine

Discovered in 1949 in San Bernardino County, California, Mountain Pass mine consists of a bastnäsite ore-body with significant concentrations of rare earth elements.[33] The mine once supplied most of the world's rare earth elements.[34] Mountain Pass is the only operational rare earth mining and processing facility in the United States.[10] The expected Mountain Pass mine life is approximately 24 years.[35]

MP Materials produced 28,000 tonnes of rare-earth oxide equivalent from Mountain Pass in 2019, and 38,500 tonnes in 2020, or more than 15% of global production.[4] As of late 2020, Shenghe Resources was the sole purchaser of MP Material's rare earth concentrate.[36][37]

As of 2023, MP Materials had a three-stage plan for scaling its operations:[38]

  • Stage I: Production of rare earth concentrate
  • Stage II: Production of separated and refined rare earths
  • Stage III: Production of rare earth metals, alloys, and permanent magnets

As of 2023, stages II and III were underway and the company had begun production of refined rare earths.[39][40] MP Materials signed a supply chain agreement with Japanese trading house Sumitomo Corporation in 2023.[41]

U.S. government contracts

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In July 2020, the United States Department of Defense issued a preliminary contract to MP Materials intended to restore domestic heavy rare earth production and separation capabilities to the United States.[42][43] In November 2020, the United States Department of Defense awarded MP Materials $9.6 million as part of a government effort to increase domestic production of rare earth materials.[44][45]

On September 30, 2020, President Donald Trump issued an executive order targeting China's dominance of rare earth materials. In the executive order, he expressed concern for the heavy reliance of the US on China for 80 percent of rare earth materials. He reiterated the importance of producing and refining rare earth in the US and discussed various tariffs and government grants to rare earth material companies such as MP Materials.[46][47][48]

In 2021, MP Materials received $3 million in funding from the United States Department of Energy to design and study the feasibility of a system to produce rare earth oxides and metals from coal by-products in collaboration with the University of Kentucky.[17][49]

In February 2022, U.S. President Joe Biden announced at a press conference that the United States Department of Defense was investing $35 million into MP Materials as part of an effort to spur domestic rare earth production in the United States.[50][51] Biden said that this move was designed to reduce America's reliance on rare earth minerals imported from other countries.[52][53] The Biden administration said the federal funding is earmarked to assist the company to develop a new commercial facility for “heavy” rare earth mineral processing.[51]

On May 24, 2024, the Biden Administration announced a 25 percent tariff on rare earth magnets from China, set to take effect in 2026. This marks the first time that critical minerals, including rare earth magnets, have been specifically included in the tariffs.[54] Following the tariffs MP Materials put out a statement listing the tariffs. After the announcement, CEO James Litinsky attended an event with Biden at the White House.[55]

See also

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References

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  1. ^ Khan, Yusuf (April 25, 2023). "The U.S. Wants a Rare-Earths Supply Chain. Here's Why It Won't Come Easily". The Wall Street Journal. Archived from the original on April 14, 2024. Retrieved April 14, 2024.
  2. ^ Seligman, Lara (December 14, 2022). "China Dominates the Rare Earths Market. This U.S. Mine Is Trying to Change That". Politico. Archived from the original on December 14, 2022. Retrieved May 10, 2024.
  3. ^ Cardona, Megan (December 10, 2021). "MP Materials magnet manufacturing facility to bring over 100 jobs to North Texas". Fort Worth Star-Telegram. Retrieved May 21, 2024.
  4. ^ a b Zhou, Jackie (May 9, 2021). "US seeks to challenge China on rare-earth elements, key ingredients in Biden's energy plan". Fox Business. Retrieved July 12, 2021.
  5. ^ "Could The MP Materials Corp. (NYSE:MP) Ownership Structure Tell Us Something Useful?". Simply Wall Street. Retrieved August 20, 2021.
  6. ^ "MP Materials Corp". Yahoo! Finance. Retrieved May 21, 2024.
  7. ^ Burke, Taylor (January 15, 2024). "Cortez Masto looking to strengthen domestic green energy, rare-earth elements supply chain dominated by China". KOLO 8 (ABC). Archived from the original on April 14, 2024. Retrieved April 14, 2024.
  8. ^ "MP Materials Corp 2020 Form 8-K Quarterly Report". U.S. Securities and Exchange Commission. Archived from the original on November 23, 2020. Retrieved January 31, 2021.
  9. ^ "MP Materials Corp 2020 Q3 Summary" (Press release). U.S. Securities and Exchange Commission. Archived from the original on February 4, 2021. Retrieved January 31, 2021.
  10. ^ a b "The Californian Rare Earths Mine Caught Between Trump and China". Bloomberg News. September 27, 2018. Archived from the original on February 4, 2021. Retrieved January 31, 2021.
  11. ^ Treadgold, Tim. "Rinehart's New Attack On China's Rare Earth Dominance". Forbes. Retrieved June 18, 2024.
  12. ^ "MP Materials CEO says rare magnets supplier is a 'picks-and-shovels play' for EV market". CNBC. December 16, 2020. Archived from the original on February 6, 2021. Retrieved January 31, 2021.
  13. ^ Bradsher, Keith (October 26, 2024). "China Tightens Its Hold on Minerals Needed to Make Computer Chips". The New York Times. Retrieved October 28, 2024.
  14. ^ Miller, John W.; Zheng, Anjie (June 25, 2015). "Molycorp Files for Bankruptcy Protection". Wall Street Journal. Retrieved July 12, 2021.
  15. ^ Peg Brickley (February 1, 2017). "California's Mountain Pass Mine to be Auctioned in Bankruptcy". The Wall Street Journal. ISSN 0099-9660. Wikidata Q114387203. Retrieved October 3, 2022.
  16. ^ Peg Brickley (June 23, 2017). "Mountain Pass Mine Approved for Sale to JHL, QVT, Shenghe". The Wall Street Journal. ISSN 0099-9660. Wikidata Q114387011. Retrieved October 3, 2022.
  17. ^ a b Hudson, Sabrina (May 29, 2021). "Mine near Las Vegas produces much of world's rare earth materials". Las Vegas Review Journal. Retrieved July 12, 2021.
  18. ^ Topf, Andrew (June 16, 2017). "Mountain Pass sells for $20.5 million". Mining.com. Retrieved July 13, 2021.
  19. ^ "James Litinsky CEO of MP Materials on the Company's NYSE Debut". TD Ameritrade Network. November 18, 2020.
  20. ^ Gupta, Ruchi (November 19, 2020). "Is MP Materials Stock a Good Investment?". Market Realist. Retrieved August 9, 2021.
  21. ^ Root, Al (December 9, 2021). "GM Keeps Building Up Its EV Supply Chain. Here's the Latest Deal". Barrons. Retrieved January 26, 2022.
  22. ^ Stankiewicz, Kevin (December 9, 2021). "MP Materials CEO says GM partnership key to building EV supply chain in U.S." CNBC. Retrieved January 26, 2022.
  23. ^ "GM reaches supply deals for electric vehicle motor magnets". AP. December 9, 2021. Retrieved January 26, 2022.
  24. ^ "MP MATERIALS CORP. (MP)". MarketScreener. Retrieved July 18, 2022.
  25. ^ a b "MP Materials Corp. (MP)". Market Screener. Annecy, France: Surperperformance. Retrieved February 28, 2021.
  26. ^ Xie, John (December 31, 2020). "California Mine Becomes Key Part of Push to Revive US Rare Earths Processing". Voice of America. Archived from the original on December 31, 2020. Retrieved December 31, 2020.
  27. ^ Hui, Mary (February 5, 2021). "The US is taking steps towards breaking China's rare earths monopoly". Quartz. Archived from the original on February 10, 2021. Retrieved February 13, 2021.
  28. ^ "Shenghe Resources Holding Co. Ltd: Shareholders Board Members Managers and Company Profile". MarketScreener. Retrieved February 14, 2021.
  29. ^ Kalinic, Stjepan. "MP Materials, Lynas Rare Earths Merger Falls Through - Lynas Rare Earths (OTC:LYSCF), MP Materials (NYSE:MP)". Benzinga. Retrieved June 18, 2024.
  30. ^ a b "MP Materials Corp". CNBC. Retrieved May 21, 2024.
  31. ^ "Australian magnate Rinehart takes stake in US miner MP Materials".
  32. ^ "Gina Rinehart's Hancock buys a big chunk of Lynas stock". The Nightly. April 16, 2024. Retrieved September 15, 2024.
  33. ^ "Rare Earth Elements—Critical Resources for High Technology". US Geological Survey. May 17, 2005. Archived from the original on January 25, 2021. Retrieved January 31, 2021.
  34. ^ "The collapse of American rare earth mining — and lessons learned". Defense News. November 12, 2019.
  35. ^ "MP Materials Corp 2020 SEC Form S1". U.S. Securities and Exchange Commission. Archived from the original on February 4, 2021. Retrieved January 31, 2021.
  36. ^ Hui, Mary (February 19, 2021). "A Chinese rare earths giant is building international alliances worldwide". Quartz. Retrieved July 13, 2021.
  37. ^ "MP Materials Corp Form S-1 Registration Statement". Security and Exchange Commission. December 9, 2020. p. 9. Retrieved August 12, 2021.
  38. ^ "Rare earth mining may be key to our renewable energy future. But at what cost?". January 11, 2023. Retrieved September 15, 2024.
  39. ^ "MP Materials Reports First Quarter 2024 Results".
  40. ^ "MP Materials profit beats, starts some rare earths refining".
  41. ^ Nikkei Staff Writers (February 21, 2023). "Sumitomo to bypass China in EV rare-earth supply chains". Nikkei Asia. Archived from the original on January 31, 2024. Retrieved April 26, 2024.
  42. ^ Scheyder, Ernest (July 22, 2020). "Pentagon resumes rare earths funding program after review". Reuters. Retrieved March 16, 2021.
  43. ^ "MP Materials Corp 2020 Q3 Investor Q&A". U.S. Securities and Exchange Commission. Archived from the original on February 4, 2021. Retrieved January 31, 2021.
  44. ^ "U.S. rare earths miner MP Materials profit surges in first results post listing". Reuters. November 23, 2020. Retrieved July 13, 2021.
  45. ^ "China May Ban Rare Earth Tech Exports on Security Concerns". Bloomberg News. February 19, 2021. Retrieved July 13, 2021.
  46. ^ Gould, Joe; Mehta, Aaron (October 1, 2020). "Trump executive order targets rare earths minerals and China". Defense News. Retrieved June 18, 2024.
  47. ^ "Executive Order on Addressing the Threat to the Domestic Supply Chain from Reliance on Critical Minerals from Foreign Adversaries – The White House". trumpwhitehouse.archives.gov. Retrieved June 18, 2024.
  48. ^ "Trump issues fresh rare earth mining executive order".
  49. ^ "DOE awards #3M to MP Materials for project to extract rare earths from fossil fuel waste streams". Green Car Congress. May 17, 2021. Retrieved July 12, 2021.
  50. ^ Scheyder, Ernest; Holland, Steve (February 22, 2022). "Biden voices support for new U.S. mines, if they don't repeat past sins". Reuters. Retrieved March 1, 2022.
  51. ^ a b Ronayne, Kathleen (February 22, 2022). "Biden wants to cut into China's electric battery dominance". AP. Retrieved February 23, 2022.
  52. ^ Gangitano, Alex (February 22, 2022). "Biden says mineral supply chain actions will help end foreign reliance". The Hill. Retrieved February 23, 2022.
  53. ^ Coppola, Gabrielle (February 26, 2022). "Biden Bets on U.S. Battery Independence". Bloomberg. Retrieved March 1, 2022.
  54. ^ Su, Annie (May 15, 2024). "US to impose 25% import tariffs on Chinese rare earth magnets in 2026". Fastmarkets. Retrieved June 18, 2024.
  55. ^ Hendrich, Brian (May 15, 2024). "MP Materials, Australia, China: Reaction to the New U.S. Import Tariffs - rawmaterials.net". Retrieved June 18, 2024.
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