Completion of EUR 2.2 million first round financing/IPO planned in 2012
Heidelberg. Deutsche Rohstoff AG (Heidelberg) has established the “Seltenerden Storkwitz AG”, a new company in order to promote the development of the rare earth deposit Storkwitz in the license area Delitzsch/Saxony/Germany. The deposit is the only known rare earth elements (REE) deposit in Central Europe. REE are mainly found in high- and environmental technology. Historic exploration results state that the deposit in Saxony accounts for approximately 38,000 tons of rare earths and 8,000 tons of niobium. First round financing provided EUR 2.2 million and was conducted exclusively with investors from Germany. The initial target will be to transform the historical resource into an internationally accepted standard (JORC) and to significantly increase the deposit subsequently. With 63% Deutsche Rohstoff AG (DRAG) holds the majority of the Chemnitz-based Seltenerden Storkwitz AG. For the year 2012, an IPO is planned in Germany. Currently, the licence is being transferred from Deutsche Rohstoff AG to Seltenerden Storkwitz AG.
Dr. Titus Gebel, Chairman and CEO of Deutsche Rohstoff AG: “The only known rare earth deposit in Central Europe can now be developed further. Since GDR times, geologists agree that this deposit could still grow to depth. Seltenerden Storkwitz AG has access to the best experts and was able to win Bernhard Giessel, an experienced industrial manager, as CEO.”
Bernhard Giessel, chairman of the new company, said: “Not least because of the support of the increasing commodity policy of the Federal Government, actions of German companies gather pace, such as the planned “Alliance for securing raw materials”. We are convinced that the deposit will also be of interest for German industry.”
Chance discovery during GDR times
The Storkwitz deposit has been discovered during uranium exploration activities in the 1970s. The completely unexpected discovery was a sensation at that time, as comparable rare earth deposits were never discovered in Germany before. Out of 29 drill holes in the area the ore body was defined by five holes. The deposit includes light REE, such as Cerium, Lanthanum, Praseodymium and Neodymium, but also heavy rare earths such as Europium and Yttrium.
In spring 2012, a drilling program will begin in order to transform the deposit into an internationally accepted resource according to the Australian JORC standard. Subsequently, the extension of the deposit at depth shall be examined further in particular. Historical exploration work lead to the assumption that the deposit has significant further potential. The discoverer, the German-Soviet uranium company Wismut, estimated the potential amount of REE up to 136,000 tons in 1975.
Rare earth elements: one of the most critical raw materials
The 17 elements of the rare earths are used primarily in technologically sophisticated products. In particular, high-tech industries and also solar- and windpower depend on several of these elements. Approximately 97% of the world production of rare earths comes from China, but China controls the export of these metals and has been cutting export several times over the past years. Accordingly, the prices for REE have increased severely in this period.
Both the Federal Government of Germany and the EU Commission classify REE as a strategically important metals whose supply is endangered. Also within the German industry, the supply of the rare earth is viewed as critical.
Heidelberg, 10 January 2012