President and CEO Mark Saxon and Co-Founder of Tasman Metals at the New Orleans Investment Conference

Tasman is an international mix as a Canadian mineral exploration and development company that was formed by two Australians and is focused exclusively on Scandinavia.

President and CEO Mark Saxon formed Tasman Metals with business partner and fellow Director Michael Hudson. After an education in Australia at Melbourne University, Mark spent ten years working for a large Australian zinc producer before branching out, looking for other opportunities and founding Tasman Metals.

Purely Rare Earth

“It’s our first anniversary quite soon,” says Mark. “We’re a purely rare earth company and all activities are in Scandinavia, which is an area where there is a long history of rare earths. It’s a really good place to be exploring because many rare earths were first discovered in Europe.

“Our focus on rare earths in that region gives us the opportunity to provide rare earth metals for the European market. The European Union has the same demand for rare earth metals as the US or Japan which are obviously seeing issues with security of supply. The EU has those same issues. Because Tasman was one of the first companies on the scene in rare earth metals, we managed to secure essentially every project within the Scandinavian region. And so we are the only company operating in mainland Europe in rare earth metals.”

When Tasman Metals first came to Scandinavia, it acquired numerous properties across the region. The two leading areas in Sweden are the Bastnas project, in a region with historic rare earth elements and gold mineralization, and the Norra Karr property in the south of the country. This latter project is the company’s main focus and is a property where Mark thinks the company “got very lucky”.

He describes it: “Norra Karr is a peralkaline intrusion, which is about one kilometer long by 300 meters wide. Our property never had drill holes before so we’ve never had the long legacy of information that some of our competitors have with their projects. Our drilling program in winter and spring was the very first drilling on that site. We drilled 26 holes for about 3,500 meters. We don’t have a resource on that property, yet, however one will be published in the middle to the end of November 2010. Our 26 holes were drilled from surface to about 100 meters vertical depth. We intercepted mineralization on every single hole.

“Typically, we’re seeing grades of 100 meters at 0.6 to 0.7 total rare earths, of which 50% is heavy rare earths. The really striking thing for that is the heavy rare earths; and I believe that we have one of the highest proportion heavy rare earth projects in the world.”

Early Stage

With the project still at a relatively early stage, it’s too soon to say how it will be mined. However, Mark believes he knows enough about the property to speculate with a degree of confidence: “It’s 150 meters wide at surface and 600 meters long. It goes down to 100 meters and is open depth. With that kind of geology, it looks sensible as an open pittable project.”

This method of mining offers the prospect of low cost extraction, especially given that Sweden is renowned for its well-developed infrastructure. “We have roads to the drill site, we have power and we have water,” comments Mark. “There are local villages where the drillers stay in a guest house. We don’t have to build a camp; we don’t use helicopters or floatplanes, so the costs are very low in that regard.”

Other advantages are that Sweden has a long history of mining and is known as a mining-friendly country. As a result, there is a transparent and predictable permitting process. It is also a stable and democratic country that offers good, long-term prospects.

Tasman Metals has some 50 million shares, which stood at 60 cents at the time of the last financing. The price is now around $1.50, which is a good move up. This is partly due to the company having a good run but also, says Mark, because the macro picture for rare earth metals is extremely good.

Supply Shortage

Around 95% of rare earth element supply is currently from China but recent developments in the region have shown the folly of placing too much reliance there. Mark explains: “With the conflict between the Chinese and the Japanese with regards to border disputes, the withholding of rare earth supply came into play. That’s obviously been good for the sector and shown that there’s potential for the Chinese government to use rare earth as a political tool. If the rest of the world wants to have a secure and long-term rare earth business then they really need to have an alternative supply.”

The next milestone for the Norra Karr project is its 43-101 resource calculations with the expectation that the resource will be inferred. After that, metallurgical work will begin, the results from that will follow and then a winter drilling program is planned.

Anyone thinking of investing in Tasman Metals can be encouraged by the macro picture for rare earth metals, which Mark describes as “tremendous”. This is largely due to the strategic importance of the metals coupled with the current shortage of supply. Mark believes the macro economics are especially advantageous for Tasman Metals: “We have a project of real significance, the most significant one in Europe. We have a real opportunity to fill the gap within the European Union and supply the metals for that market.

“The company is still at an early stage, we’re a much lower market capitalization than some of our competitors but we’re moving up as we gain knowledge. We’re generating lots of good news about this project all the time. We’re also working on our other projects as well across the Scandinavian region. We have money in the bank, we have the properties and we have the people to work on them.”

Expert Observation

Mickey Fulp states “Tasman Metals is the only rare earth element junior explorer of significance in Europe, specifically Scandinavia. You know how I like emerging market countries and the “first-in” concept for exploration success (Mercenary Musing, May 18, 2009).” A Monday Morning Musing from Mickey the Mercenary GeologistContact@MercenaryGeologist.com May 31, 2010

For more information:

http://www.tasmanmetals.com

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