At the centre of it sits the technology that was going to turn Bokan's rock into an oxides. It involved a company called IntelliMet.
The Believers
Ucore’s attempt to commercially mine rare earth elements (REEs) and separate them into individual oxides is a convoluted story. But it is the story of the West trying to break China’s grip on rare earths. If you missed the first part, you can read it here.
To summarize: Ucore went public in 2006 and became a junior uranium explorer the same year. When the uranium price collapsed in 2008, it turned to rare earths, and it built a financial structure that worked.
In 2011, the rare earth market had the best year it has ever had. Prices were at records, and money was chasing anything with “rare earth” in the name. Ucore sold no new shares that year. Eighteen months later, its auditor wrote that the company might not last. This is the story of what they did instead.
The Wrong Metals
For the first two years, they drilled for uranium. The assays came back with anomalous rare earth values. The best results came from the Lost Pond property in Newfoundland, which returned 4.47% over 5.64 meters total rare earth oxide (TREO). But Lost Pond was a uranium property and rare earths were not what Ucore was looking for.
They stayed with uranium until the price crashed. The REEs they had passed had, by then, run up in price far enough to become the main asset.
So the strategy was restated. The fiscal 2009 filings describe a junior exploration company in search of economically viable “rare earth element (‘REE’) and uranium properties”. The corporate name change to Ucore Rare Metals followed in 2010.
What redirected them was this: in 2009 they re-examined the drill intersections from the 2008 drilling at Bokan and documented highly anomalous rare earth values in several of them. At the same time, rare earth prices were spiking to levels never seen before. Those two facts together pushed Ucore to redirect the program.
So how much rare earth did they think was in Bokan Mountain?
When Ucore finally put a number to Bokan, 39% of the contained TREO was heavy. A deposit with that split is worth far more per tonne than its grade alone would suggest, and it is that ratio, not the grade, that became Bokan’s principal selling point.
The First Number
The first official measure of Bokan came in April 2011. At a 0.4% cut-off, offered in the report as “an example”, it held 5.275 million tonnes at 0.645% total rare earth oxide. Low grade, and all of it inferred, the weakest of the three confidence classes. The one thing that made it interesting was the split they had announced earlier: about 40% of the contained oxide was heavy rare earth.
Mining reports in Canada are written to National Instrument 43-101, a disclosure rule set by the Canadian Securities Administrators, and its confidence classes exist to tell an investor about the mine. Inferred is the weakest of the three: enough sampling to believe the mineralisation continues, not enough to count on it.
Living on Warrants
To upgrade the resource from Inferred into Indicated or enough drilling to reclassify most of the Dotson Zone down to 250 meters, they needed around C$7.8 million. But they didn’t have the cash at the moment. How did they finance it?
Raising money for a company like this means selling new shares to investors for cash (they have no revenue, so this is how they live). In 2011 they sold none. So where did 2011’s money come from?
Warrants
A warrant is a coupon Ucore handed out with the 2010 shares: it lets the holder buy one more share later at a fixed lower price. A warrant is only worth using when the real stock price is above that fixed price. In 2011, the rare-earth boom pushed Ucore’s stock up well above the warrants, so holders “exercised” them. That’s where the $4.2 million came from.
And they still burned cash. Even with that $4.2M coming in, cash fell from $9.3 million to $268,000. They spent more than came in (drilling, consultants, investor tours) and parked most of it in short-term deposits. Counting both, total liquidity went from $11.6 million to $7.55 million.
Why does it matter?
2011 was the single best year the rare-earth market has ever had. Prices were at all-time highs. Money followed anything with “rare earth” in the name. A company on a real path would use that once-in-a-lifetime moment to raise a big pile of new money on great terms. Ucore raised nothing new. Why?
Washington’s List
Part of the answer came from Washington. In December 2011, the Department of Energy published its Critical Materials Strategy, and Ucore is in it. Listed last of twelve rare earth companies, at a market value of $71 million, against Molycorp’s $3.08 billion.
The same document explains why:
Even with prices at historic highs for most rare earth elements, some pure play rare earth projects may be less attractive to investors due to the lack of valuable byproducts.
Nobody Had Agreed to Buy Anything
The new technical report was published in January 2013. It contains a section headed Market Studies and Contracts, which exists to report what market work had been done and which buyers had committed. It opens:
There were no market studies conducted and no contracts reached between Ucore and refiners at the time that this PEA was completed.
The basis for assuming the oxides could be sold is the sentence that follows it:
Due to inceasing demand in the US and diminishing supplies from China, it is expected that the final REO products will be sold within the US.
The typo is theirs.
Bokan Mountain · 2013 Preliminary Economic Assessment
Where the tonnes are, and where the money is
Every rare earth element Bokan would produce, ranked by how much of the money it brings in. For each one, the blue dot is its share of everything the mine would dig up, measured by weight. The orange dot is its share of the revenue. When the two dots sit far apart, that element is worth far more, or far less, than its tonnage suggests.
Dysprosium is 4% of the rock and 30% of the money. Cerium is the mirror image: a third of everything mined, a tenth of what is earned. And yttrium, which makes up nearly two thirds of Bokan’s celebrated “heavy” rare earths, earns less than its weight. It is classed as heavy by chemistry, not by price.
Heavy elements (europium through lutetium, plus yttrium, per the report’s own definition) are set in stronger type; lights are lighter. Production from Section 22.1.1, Table 22.2; prices from Table 22.1, being three-year trailing averages of China FOB prices, October 2009 to October 2012. Thulium was assigned no price (“a trivial price is assumed ($0)”). Revenue is gross in-situ basket value over the eleven-year mine life, about US$2,548 million, before payability and per-element recovery differences. Source: Ucore Rare Metals Inc., Preliminary Economic Assessment on the Bokan Mountain Rare Earth Element Project, Tetra Tech, effective 10 January 2013.
Table view
| Element | Class | Production (kg) | Price (US$/kg) | Weight share | Revenue share |
|---|---|---|---|---|---|
| Dysprosium | Heavy | 889,121 | 845.80 | 4.42% | 29.51% |
| Yttrium | Heavy | 4,782,634 | 80.41 | 23.79% | 15.09% |
| Neodymium | Light | 2,940,686 | 126.70 | 14.63% | 14.62% |
| Cerium | Light | 6,096,947 | 47.21 | 30.33% | 11.29% |
| Terbium | Heavy | 133,350 | 1,520.83 | 0.66% | 7.96% |
| Europium | Heavy | 75,537 | 1,834.94 | 0.38% | 5.44% |
| Lanthanum | Light | 2,009,622 | 48.69 | 10.00% | 3.84% |
| Praseodymium | Light | 758,162 | 113.10 | 3.77% | 3.36% |
| Gadolinium | Heavy | 778,320 | 81.70 | 3.87% | 2.50% |
| Samarium | Light | 771,549 | 57.74 | 3.84% | 1.75% |
| Erbium | Heavy | 388,222 | 88.20 | 1.93% | 1.34% |
| Holmium | Heavy | 149,377 | 211.39 | 0.74% | 1.24% |
| Ytterbium | Heavy | 256,441 | 102.79 | 1.28% | 1.03% |
| Lutetium | Heavy | 25,126 | 1,036.40 | 0.12% | 1.02% |
| Thulium | Heavy | 48,958 | 0.00 | 0.24% | 0.00% |
The Trinity
The 2011 technical report classified the entire deposit as inferred, the weakest class there is, and explained what that means: “Inferred Mineral Resources have a high degree of uncertainty as to their existence… It cannot be assumed that all or any part of an Inferred Resource will ever be upgraded to a higher category.”
That is a fact but companies are run by people with hope and courage.
So take the second piece, from the engineers. The 2013 Preliminary Economic Assessment reads:
A PEA should not be considered a prefeasibility or feasibility study, as the economics and technical viability of the Project have not been demonstrated at this time. The PEA is preliminary in nature and includes Inferred Mineral Resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves. Furthermore, there is no certainty that the conclusions or results as reported in the PEA will be realized. Mineral resources that are not mineral reserves do not have demonstrated economic viability.
Two sections later, Market Studies and Contracts opens by confirming that no market study was conducted and no contract with a refiner existed. Ucore commissioned that report and paid for it.
The third piece is the auditor’s. On 29 April 2013 KPMG attached an Emphasis of Matter to the 2012 statements:
Without modifying our opinion, we draw attention to note 2 in the consolidated financial statements which indicates that Ucore Rare Metals Inc. experienced losses in 2012 and 2011, has no significant sources of revenue and does not have sufficient capital to fund its operations beyond December 31, 2013. These conditions, along with other matters set forth in note 2 in the consolidated financial statements, indicate the existence of material uncertainties that cast significant doubt about Ucore Rare Metals Inc’s ability to continue as a going concern.
To sum up the geologists said the rock may not be there. The engineers said the project’s economics have not been demonstrated. The auditor said the company may not last the year. What is the next step? To became an entirely new company.
America Is Not Coming. Yet
On Friday 28 September 2012,the Defense Logistics Agency (DLA) signed purchase order SP800012M0021 with Landmark Alaska L.P., Ucore’s operating subsidiary in Ketchikan. It was worth $150,000. The description reads “Bokan Mountain Resource Assessment,“ filed under Other Scientific and Technical Consulting Services. The Pentagon was buying a report.
On Monday, Ucore announced it. The announcement described the Department of Defense’s “investment“ in the Bokan deposit, a relationship that “adds a great deal of credibility.” Eight weeks later came the $577 million valuation of Bokan from Ucore. The contract is 0.026% of it. In their press release:
The United States does not yet have the capability to produce three of the heavy rare earths that occur naturally and in abundance in Bokan Mountain,” said Jim McKenzie, President and CEO of Ucore. “The Department of Defense’s investment in the Bokan deposit and Ucore’s proprietary SPE technology represents a significant step toward recapturing the rare earths technological lead surrendered to China decades ago. What’s more, the DOD relationship adds a great deal of credibility to Ucore’s domestic supply chain development, representing one of the largest purchasing capabilities amongst prospective customers worldwide.
Every one of those statements is defensible on its own but the pictures they make might not be true.
Put the facts side by side the way an investor would have in the autumn of 2012.
China had cut its export quotas and Washington was hunting for domestic supply.
The Department of Defense had signed a contract with the company’s subsidiary.
Ucore called it an investment, said it added a great deal of credibility, and described itself as well-funded.
Eight weeks later a US$577 million valuation estimated.
In that order, at that moment, the facts might point one way: America has chosen this deposit, the strategic need guarantees a buyer, and the company is funded to build. Every one of those statements is defensible on its own.
Is there any evidence that investors actually adopted that view?
Four weeks later, North of 60 Mining News ran the story under the headline “Pentagon gets footing at Bokan Mountain,” describing a company supported by the might of the U.S. Department of Defense.
And a weaker evidence but still relevant is the market around the same days:
The market moved the next morning. On 2 October the shares jumped sharply on the heaviest volume of the period, ran higher for two more days, and then peaked.
At the centre of it sits the technology that was going to turn Bokan’s rock into an oxides. It involved a company called IntelliMet.
Who the hell is IntelliMet?
References
Bentzen, E. H., III, Ghaffari, H., Galbraith, L., Hammen, R. F., Robinson, R. J., Abdel Hafez, S., & Annavarapu, S. (2013, January 10). Preliminary economic assessment on the Bokan Mountain rare earth element project, near Ketchikan, Alaska (Report No. 1196000100-REP-R0001-02). Tetra Tech. SEDAR. [R16]
British Geological Survey. (2011, November). Rare earth elements [Mineral profile]. Natural Environment Research Council. [R30]
Lasley, S. (2012, October 28). Pentagon gets footing at Bokan Mountain. North of 60 Mining News. https://www.miningnewsnorth.com/story/2012/10/28/news/pentagon-gets-footing-at-bokan-mountain/2636.html [R33]
Robinson, R. J., & Power, M. A. (2011, April 21). [Technical report and mineral resource estimate, Bokan Mountain property, Alaska]. Aurora Geosciences Ltd. SEDAR. [R28]
Robinson, R. J., & Schulze, C. (2026, April 9). S-K 1300 summary report and NI 43-101 technical report on the Bokan Mountain property, southeast Alaska, USA. Aurora Geosciences (Alaska) Ltd. SEDAR+. [R17]
TradingView. (n.d.). Ucore Rare Metals Inc. (TSXV: UCU) [Price chart]. Retrieved July 27, 2026, from https://www.tradingview.com/chart/Nzkv4dK9/?symbol=TSXV%3AUCU [R34]
Ucore Rare Metals Inc. (2011a, May 6). Management’s discussion and analysis for the year ended December 31, 2010. SEDAR.
Ucore Rare Metals Inc. (2011b, June 30). Management’s discussion and analysis for the three months ended March 31, 2011. SEDAR.
Ucore Rare Metals Inc. (2012a). Consolidated financial statements for the years ended December 31, 2011 and 2010 (audited by KPMG LLP). SEDAR.
Ucore Rare Metals Inc. (2012b, June 26). Management’s discussion and analysis for the year ended December 31, 2011. SEDAR. [R1]
Ucore Rare Metals Inc. (2012c, October 1). U.S. Department of Defense contracts with Ucore for metallurgical and SPE studies [Press release]. SEDAR. [R32]
Ucore Rare Metals Inc. (2012d, November 29). Management’s discussion and analysis for the three and nine months ended September 30, 2012. SEDAR.
Ucore Rare Metals Inc. (2013a). Consolidated financial statements for the years ended December 31, 2012 and 2011 (audited by KPMG LLP). SEDAR.
Ucore Rare Metals Inc. (2013b, April 29). Management’s discussion and analysis for the year ended December 31, 2012. SEDAR. [R2]
Ucore Rare Metals Inc. (2014, April 7). Management’s discussion and analysis for the year ended December 31, 2013. SEDAR. [R3]
Ucore Uranium Inc. (2010, April 30). Management’s discussion and analysis for the year ended December 31, 2009. SEDAR.
U.S. Department of Defense, Defense Logistics Agency. (2012, September 28). Award SP800012M0021 to Landmark Alaska Limited Partnership [Federal contract record]. USAspending.gov. Retrieved July 26, 2026, from https://www.usaspending.gov/search?hash=ca54dcde1e2cf4edb7860a7febb7c81f [R31]
U.S. Department of Energy. (2011, December). Critical materials strategy. [R29]
