The Philippine government expects to start by the first quarter this year the identification of mining tenements that could be developed into rare earth exploration sites amid an extended halt on China’s production of the metals, the Mines and Geoscience Bureau (MGB) said on Wednesday.

In an interview, MGB Director Leo Jasareno said that they have conducted initial inspections in several areas that could be developed into mining sites dedicated to rare earth elements (REE)—a major component of electronic equipment and mobile phones.

“In fact, we have already found potential areas to explore and these areas are also close to copper-gold mines. Notably, Palawan and Nueva Vizcaya are the best places to start,” Jasareno said.

The MGB earlier said that it would be spending some P20 million for the program. The Philippines is pushing for exploration projects for the development of its REE deposits following China’s decision to cap exports to the global market.

The push for the exploration of the country’s REE deposits was held back for almost a year after the experts from the China Geological Survey, a Chinese government-owned entity, did not arrive in the country for the planned joint exploration program.

Jasareno said that they have yet to hear a reply from Beijing, saying that they have constantly “reminded” their Chinese counterparts on the project.

“So far, we have received no words from them,” he said.

China, which controls about 97 percent of global rare-earth supply, has been reducing its export quotas to secure greater control over prices.

The Asian economic powerhouse also said that it would further tighten its control over REE production by expanding its export-quota system and imposing higher taxes. Chinese firms found violating export quotas would be sanctioned and slapped with a high penalty.

Prices going down
But despite the cap on REE production, prices of the metals continued to go down over the past several months, forcing China’s largest rare earth producers to extend halt in production for another month.

In December 2012, Baotou Steel Rare-Earth said that it would suspend output at some plants for another month, extending a halt started in late October to try and stem falling prices.

Based on reports, the price of praseodymium-neodymium oxide, a rare earths compound used for ceramics and magnetic materials, has slid to around $48,000 per ton, less than one fourth the level at the highest point in 2011.

The company implemented a similar month-long production halt in October 2011, but failed to reverse the downtrend in global and domestic prices of rare earths.

REE are also dubbed as the “metals of the future” and “strategic minerals,” because of their uses in the development of weapons guidance systems and other space age technologies.

Although REE are relatively abundant in the earth’s crust, they are rarely concentrated into mineable ore deposits. The principal concentrations of rare earth elements are associated with uncommon varieties of igneous rocks, namely alkaline rocks and carbonatites.

Potentially useful concentrations of REE-bearing minerals are also found in placer deposits, residual deposits formed from deep weathering of igneous rocks, pegmatites, iron-oxide copper-gold deposits, and marine phosphates.