Special Report The Mining Coup of the Century How to Make Breakthrough Profits on the Little Rare Earth Miner By Jeff Opdyke, Investment Director Senior Editor, The Sovereign Society The Sovereign Society 98 S.E. 6th Avenue, Suite 2 Delray Beach, FL 33483 USA USA Toll Free Tel: (888) 358-8125 Contact: http://sovereignsociety.com/contact-us Website: www.sovereignsociety.com Copyright © 2010 by The Sovereign Society. All international and domestic rights reserved. No part of this publication may be reproduced in any form, printed or electronic, without prior written permission from the publisher, The Sovereign Society. Notice: This publication is designed to provide accurate and authoritative information in regard to the subject matter covered. It is sold and distributed with the understanding that the authors, publisher and sellers are not engaged in rendering legal, accounting or other professional advice or service. If legal or other expert assistance is required, the services of a competent professional advisor should be sought. The information and recommendations contained in this brochure have been compiled from sources considered reliable. Employees, officers, and directors of The Sovereign Society do not receive fees or commissions for any recommendations of services or products in this brochure. Investment and other recommendations carry inherent risks. As no investment recommendation can be guaranteed, the Society takes no responsibility for any loss or inconvenience if one chooses to accept them. Any information or statements contained in this publication are not to be considered by the reader as personalized investment advice. The authors and any agents of The Sovereign Society are not licensed under U.S. or other securities laws to address particular investment situations and nothing herein should be deemed as personalized investment advice. 2 How to Make Breakthrough Profits on the Little Rare Earth Miner… This isn’t just the “mining coup of the century.” This is a $58 billion mining coup of the century. In fact, this is a mining coup of the century that could hand you as much as 1,443% gains by January 31st. Buy just $5,000 worth of stock in the powerhouse I’m about to reveal in this research report and by January 31st you could have $77,150. With $10,000, you could have $154,300. With $50,000, you could soon be adding “millionaire” to your title. All thanks to one mining company… And the biggest discovery of the world’s scarcest and most politically charged metals in 83 years. Let’s take a look… 3 Hidden on the Edge of No Man’s Land Lies 4.9 Million Tons of Treasure Greenland has spent the last 281 years trapped in a political and economic time warp. Its vast mineral wealth has stayed locked away under the rule of an ancient European monarchy. But in 2010, its population of 57,000 fishermen took a giant leap towards winning back their independence. The leap: Regaining full rights to their mineral wealth, and enacting a new law to attract miners. Now, the likes of Rio Tinto and Alcoa — and many of their brethren, big and small — are sweeping in and transforming this economic backwater into the planet’s last great mineral frontier. Only Greenland Minerals and Energy (ASX: GGG) got there first. And it’s just made a $58 billion rare earth metals discovery… Rare earth metals are those weird-sounding elements you find near the bottom of the periodic table. They’re also elements that our modern civilization has become entirely addicted to. In fact, without them, we couldn’t make batteries, Blackberries, electric cars, computer chips, computer monitors, Prius’s, rockets, jet engines, flat screen TVs, cell phones, photo cells, lasers or iPods… Wind turbines rely on the rare earth metal, neodymium. You need 656 pounds of neodymium to generate just one megawatt of power. This year alone, we installed 40,000 megawatts of wind power worldwide, swallowing over 8,820 tons of neodymium (46% of global production). But that’s nothing compared to what’s coming. Green energy initiatives demand that another 200,000 megawatts of wind power be brought online by 2014. This scenario will require an extra 44,100 tons of neodymium. 4 And by 2030, wind farms will need 507,150 tons of the stuff. We only produced 19,000 last year — 26 times less than what we’ll need just for wind turbines. We’ll also need thousands of tons more to make all the computer hard drives, electric motors and hydroelectricity the world will need. The thin-film solar panels we use today rely on the rarest earth element of them all: tellurium. This metal is quickly becoming one of the key elements keeping solar energy pioneers like FirstSolar shining. Thing is, we only produce a little over 100 tons of this metal each year. We need about 10 times that amount to meet immediate future demand! Gallium is another darling of the mineral world that makes the solar industry shimmer, but we only produced 78 tons of this metal in 2009. Commercial solar applications will demand that we refine 1,600 metric tons of gallium to power just 15 million homes. That’s a 2,162% increase over last year’s production levels. And the ever-popular Prius uses a nickel-metal hydride battery based on the rare earth metal, lanthanum. This is the same type of rechargeable battery that’s in your video camera, electric toothbrush and every cell phone. Unlike your BlackBerry, the Prius needs up to 33 pounds of lanthanum per battery. Today, Toyota has one million more Prius’s slated for construction — and this next million will need 33 million pounds of lanthanum to run. That’s just the demand from one company! Yet supply shocks are already occurring in these metals. And the situation is only going to get worse… In fact, the lack of rare earth metals is one of the biggest concerns right now for many tech giants — including Apple, United Technologies, General Dynamics, GE, IBM, Cisco, Samsung, Sony, Microsoft, Panasonic, Hitachi and Siemens. And the problems are even greater for the fast emerging new green technology and alternative energy industries. That’s why the money you could make in these metals will be breathtaking. Metal Neodymium Tellurium Gallium Lanthanum Praseodymium Scandium Yttrium 17 Rare Earth Metals and How We Use Them Uses Rare-earth magnets, lasers, ceramic capacitors Thin-film solar panels Commercial solar applications Rechargeable batteries, high refractive index glass, flint, hydrogen storage, camera lenses, fluid catalytic cracking catalyst for oil refineries Rare-earth magnets, lasers, flint Aluminum-scandium alloy High-temperature superconductors 5 Cerium Promethium Samarium Europium Gadolinium Terbium Dysprosium Holmium Erbium Thulium Ytterbium Lutetium Chemical oxidizing agent, polishing powder, catalyst for self-cleaning ovens, fluid catalytic cracking catalyst for oil refineries Nuclear batteries Rare-earth magnets, lasers, neutron capture, masers Red and blue phosphors, lasers, mercury-vapor lamps Rare-earth magnets, high refractive index glass or garnets, lasers, x-ray tubes, computer memories, neutron capture Green phosphors, lasers, fluorescent lamps Rare-earth magnets, lasers Lasers Lasers, vanadium steel Portable X-ray machines Infrared lasers, chemical reducing agent PET Scan detectors, high refractive index glass Global Demand for Rare Earth Metals, 2008 to 2012 Up 1,443% in 52 Weeks… Supply shocks have already occurred in many of these metals in just the last decade, causing price spikes as high as 325%, 461% and 1,433% in as little as 52 weeks! For example, one of the biggest investment stories last year was in the rare earth metal tantalum. Tantalum is one of the most important metals used in capacitors, which is a fundamental component to many of the electronics we use today. It’s found in cell phones, iPods, computers, jet engines, pace makers, artificial hips and digital cameras… Yet, last year the world produced absolutely no tantalum — not one gram — causing tantalum’s price to almost triple in a matter of months! 6 Another supply crunch happened as far back as 2000, when Sony launched the PlayStation 2. But to build the millions of units required, Sony needed a helluva lot of tantalum. This caused the price to spike from $49 a pound to $275 a pound in less than a year (a 461% increase!). And just in the last year supply shocks in the rare earth metal praseodymium (which is used in energy-efficient light bulbs) caused its price to spike 1,443%! These metals played major roles in some of the most important stories that unfolded over the last decade. They also provided some of the greatest (yet most little-known) investment opportunities. But if you think you missed out on them, don’t worry. They pale in comparison to what’s coming. Even if the world went into depression, these metals would still do well. The day for rare earth metals has arrived. Greenland Minerals & Energy: A Mining Hero to the World Greenland Minerals & Energy is a relatively new company created by a few old mining legends. Its founders and directors have been around for decades and have launched several extremely successful mining companies already, including Paladin Energy, whose stock price (under their management) has leapt as much as 9,500% in less than four years thanks to a successful uranium project in Namibia. Now they’re on the brink of repeating their successes in Greenland. The real coup de temps? The discovery of 4.9 million tons of rare earth metals at the Kvanefjeld deposit in the Ilimaussaq Intrusive Complex on the southwest tip of Greenland. This is probably the biggest rare earth metal deposit in the world. There’s enough in this one single mine to provide global industry with about 25% of the rare earth metal it needs for 23 years! The deposit is exposed at the surface along a series of undulating bluffs on a broad peninsula that’s surrounded by deep water fjords. This truly is a staggering discovery — one for the geopolitical, industrial and economic history books! The Greenlanders love it. The environmentalists should love it. Global industry desperately needs it. The only group NOT happy about this… is the Chinese. 7 Thwarting the Bully Could Hand You Multiple Profits AND “stick-it-to-‘em” Satisfaction China is blessed with the world’s richest deposits of rare earth metals. Realizing early on the economic (and political) value such an inheritance offered them, they set about establishing themselves as the global leaders in the production of these metals. They now boast a clutch of the biggest, most powerful, most profitable, cash-rich rare earth metal corporations on the planet today. In fact, they have managed to steal a staggering 97% share of the global market place, creating a mineral monopoly… one that’s powerful enough to hold the world to ransom. You see, global demand for these metals is escalating. But Chinese exports are shrinking dramatically. In 2012, China may implement a complete embargo on the export of a number of these strategic metals… Until the $58 billion discovery in Greenland, this Chinese choke hold could have caused violent disruptions in the industrial marketplace. Thankfully, Greenland Minerals & Energy has saved the world that fate. As Business News recently said about the Kvanfjeld project: “[It] could rival the world’s largest rare earth mines in China.” 4.91 Million Tons of Rare Earth Metals and a Proven Management Team Makes This a Winner Right now, Greenland Minerals & Energy is focusing on the exploration and development of uranium and rare earth metals mining operations in the Kvanefjeld deposit within the Ilimaussaq intrusive complex. It conducted a successful field study in 2008, confirming that the area has the following resources: • 283 million pounds uranium oxide (U3O8) • 4.91 million tons of rare metals • 2.21 million tons of sodium fluoride (NaF) This makes this area the second largest rare earth resource in the world, next to China’s Baiyenebo Deposit. The Kvanefjeld Project alone has a net present value of $2.18 billion and a calculated free cash flow of $8.9 billion over the 23-year mine life. 8 The stock is only listed right now on the Australian stock market. But that’s about to change. The company is getting all its cards in order, ready to launch on the big North American and European exchanges. And it hopes to do it at the beginning of 2011. Once the stock lists, the news will be out. And its stock price should go ballistic. That’s why they’ve gathered together a prestigious board of directors. For example, Lars Emil Johansen, the former Prime Minister of Greenland, now sits as Chairman of the company’s main subsidiary! Johansen is considered a national hero by his people, as he was a pivotal figure in winning back the country’s independence, and winning back its full mineral rights. He’s also been given a string of prestigious national and international awards for his achievements and service to his country. Not only that, Michael Hutchinson, the director of the London Metal Exchange — the largest commodity and futures trading platform in the world — is a director. He holds one of the most important (and connected!) positions in the global metals trading game. Get in Now While Shares Are Cheap You have a short window of opportunity to get in on this stock — while it’s still dirt cheap and virtually unknown. But with all these historic events converging, and with the stock expected to hit its first big exchange in January, you don’t have much time. How high could this company’s share price go? As I said a moment ago, the founders have already launched mining companies whose share prices have soared as much as 9,500% in the past. We think they’re on the path to do it again with Greenland Minerals & Energy! IMPORTANT NOTE: This is an aggressive stock play. Do not invest money you can’t afford to lose. Don’t delay… news of this rare earth metals miner is getting out there. The Dow Jones Newswire reported on it just the other day, causing the company’s share price to rise from 36 cents to 64 cents in a single day… a 75% increase! So much momentum is gathering about this one little stock right now. That’s why I’m calling this The Mining Coup of the Century. Fast-acting investors who enjoy the thrill of an aggressive trade clearly stand to make a fortune. Of course, there is tremendous upside with this company, but there is also a degree of risk involved with a small-cap stock of this nature (the market capitalization is only A$224 million). Only invest money you can afford to lose. Action to Take for Aggressive Investors: Buy Greenland Minerals & Energy (ASX: GGG) at market. 9
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