* Great Western shrs up 9.3 pct at C$0.235
* To buy 100 pct of rare earth output at S. African mine
TORONTO Aug 10 Shares in Great Western
Minerals Group GWG.V rose more than 9 percent on Tuesday
after the junior Canadian minerals explorer said it has signed
an agreement to purchase 100 percent of the rare earth metals
production at a mine in South Africa.
The Steenkampslraal mine, a former thorium mine owned by
Rare Earth Extraction Co, contains 30,000 tonnes of total rare
earth oxide at a concentration of 17 percent, Great Western
Rare earth metals are used in hundreds of technologies,
from cellphones to batteries for hybrid cars.
The 10-year agreement is conditional on Great Western
completing a feasibility study by end of year, and providing
financing. Financing may be a loan, an equity investment or any
combination the two companies agree on, Great Western said.
"The agreement propels our company toward becoming the
first fully integrated rare earths producer outside China,"
Great Western Chief Executive Jim Engdahl said in a press
China currently produces about 90 percent of the world's
rare earth metals. Last month, Chinese media reported the
government planned to fix monthly prices and impose export
controls, prompting long-term supply concerns.
Great Western shares were up 9.3 percent at C$0.235 in
afternoon trade on the TSX Venture Exchange after peaking at
C$0.24 soon after the deal was announced.
(Reporting by Julie Gordon; editing by Peter Galloway)