First, China provided rare earth elements very cheaply to everybody in the world by

their cheap labor, lack of enforceable environmental regulations, and their appreciate currency.

Essentially consolidate, control the rare earth market.

And then they said, "Well, now all of you are coming to our door to buy our rare earths.

We don't want to sell the raw material anymore.

Our manufacturers can buy it cheaper than your manufacturers."

They impose a huge export tax on rare earth elements.

So, one had a choice to accept a huge tax and increase in the price of the product or

relocate factory into mainland China and buy rare earth elements on the local market without

tax.

It's a strategy.

It's working pretty well.

Manufacturers which use rare earth elements in their products relocated their manufacturing

base inside China.

The jobs in manufacturing transferred from the United States and western Europe into

the Chinese mainland.

They've moved all the way up the value chain and are actually able to leverage their position

into capturing other countries IP.

If Toyota really wants to build a million battery packs, in the end, if they don't find

a solution to the heavy rare earth problem, they'll be building them inside China.

We just created $150 million bureaucracy to hand IP and technology and environmental science

to the Chinese government.

Older folks like me will recall a day when earphones didn't look like that.

The whole trick has been the invention of a little magnet based on neodymium, neodymium-iron-boron

magnets.

Extremely powerful magnets, and they use a rare earth mineral called neodymium.

So naturally, global demand for neodymium has gone pow!

And because neodymium-iron-boron magnets are so powerful one of the places they find application

is in the generators that sit on top of windmills.

Because if you're going to put a generator on a windmill, on this really, really high

stalk, you want it to be as lightweight as possible.

Currently it's all being mined in China.

Now why am I talking about neodymium?

Well, because thorium is always found with heavy rare earth elements.

If you remember your periodic table, the lanthanides that column above the actinides, those are

all the rare earths.

Thorium policy in all western nations undermines the successful development of a domestic rare

earth market.

All of the rare earths that most western mining companies are willing to process are what

they call bastnasites or carbonatites.

They typically select these rare earths not because of the high ratios of rare earths

but simply the absence of thorium.

So consequently the only operating rare earth mine that just opened up this year, produces

essentially the lighter half of the lanthanide scale and in fact does have some monazites,

which are a thorium rare earth enriched mineralization, which they dispose of.

The most common form of heavies in terms of total aggregate would be monazite or phosphate

types.

So what happens all across America, Canada, and South America, there are beautiful monazite

deposits that have heavy rare earths which could be very commercial except for the thorium

content.

Mountain Pass was originally closed, according to CEO Mark Smith, because of the EPA and

the state of California and some thorium that came out of a ruptured tailings pipe.

So the thorium represents this unknown and unlimited liability to rare earth production,

so it plays into the hands of China.

Let me tell you how this stuff was discovered.

There was a guy named Glenn Seaborg who worked at Berkeley Labs in California in 1942.

Coming off discovering plutonium he thought, "I wonder if we can hit thorium with a neutron

and turn it into something."

You got to remember, fission had been discovered three years earlier, so they were still in

the very beginnings.

So he got this grad student.

You know, everybody who's been a grad student knows what it's like when a professor says,

"All right.

I want you to go into the nuclear lab and turn on the neutron bombardment system and

expose this sample of radioactive material and find out what happens."

"Yep, I've done it, sir.

I have made something new.

Thorium did absorb the neutron.

It became uranium-233."

"Poor little grad student!

I want you to go back.

Now I want you to hit it with a neutron and see if it will fission.

Because I think it'll fission.

I think it'll fission just like uranium-235.

Figure out how many neutrons came off when it fissioned.

Because if that number is below 2, we really don't have a story here.

If this number...

you come back, and say it's like 1.5, then, meh.

Interesting fact goes in the back of the book.

But if that number's above 2, then that is a big deal."

Goes back, comes back.

"Sir, the number is 2.5."

Seaborg looks at his grad student.

This is December 1942, and he said, "You've just made a $50 quadrillion discovery."

Grad student was like "Uhh!"

Seaborg was absolutely right.

He knew how abundant thorium was in the crust of the Earth.

And he realized that through this process, if you had some uranium-233, you could catalyze

the burning of thorium indefinitely.

Why do we care?

Here's why we care...

here we go...

Because every kilogram of fissile material will produce as much energy as 13,000 barrels

of oil.

Nuclear fission is a million times more energy-dense than a chemical reaction.

Civilization has changed over advancements in technology a whole lot more modest than

this.

So what we need to be able to do is let another entity take that thorium, develop uses and

markets, including energy.

The Air Force said, "The navy has built their nuclear submarines but the Air Force wants

to build a nuclear powered bomber."

Weinberg was a practical man and he said, "Huh.

That the purpose was unattainable if not foolish was not so important."

"A high temperature reactor could be useful for other purposes even if it never propelled

an airplane."

He knew that to make the nuclear airplane work, they couldn't use water cooled reactors.

They couldn't use high pressure reactors.

They couldn't use complicated solid fuel reactors.

They had to have something that was so slick, that was so safe, that was so simple, that

operated at low pressure-high temperature, and had all the features you wanted in it.

They didn't even know what it was.

If this program, this nuclear airplane program had not been established, the molten salt

reactor would have never been invented, because it is simply too radical, too different, too

completely out of the ball field of everything else for it to be arrived at through an evolutionary

development.

It had to be forced into existence by requirements that were so difficult to achieve, and then

nuclear airplane was that.

Here's this amazing work that was done, you know, before I was even born.

This is laws of physics stuff.

I didn't invent it, all I do promote it.

Maybe I'll never see it happen in my life, but somebody will do it.

China's doing LFTR, even as we speak.

I found that ago a few months ago.

Where are they getting the blueprints?

Or are they developing them?

Well, I mean they've probably got a whole bunch of stuff from the PDFs on my website.

It's been in the public domain for an awful long time.

I just made it a little easier to get, you know?

This was about 10 years ago.

I got in the car, I lived in Alabama and I was able to go up to Oak Ridge then talk to

some of the people there.

And I said "Hey, I've heard that you guys long time ago did this really, really cool

thing.

What's going on?" and they're like "Yeah, long time ago we did a really, really cool

thing and everybody that did it is retired or dead now."

I'm like "Oh, well, that's not good.

What can we do?"

and they said "Well, they wrote a lot of papers and they wrote a lot of reports."

I said "Oh, OK.

Can I get them?"

"Oh yeah" then they took me to this file cabinet and it was like full of stuff.

Talked to some of my friends and told them "Hey, this would be great for a space reactor.

We ought to throw some money at these guys and get all the stuff documented."

and they said "Yeah, that sounds like a pretty good idea."

So, we got a little bit of money up to Oak Ridge, about $10,000, and they went and PDF'd

- not everything but most of it, about two-thirds of it.

So, I had this stack of CD's and I thought "Oh!"

Send a copy to the Secretary of Energy, send a copy to the Director of National Labs, send

it all out to these different places just sure they were going to get CDs from a random

person and put them in their computer and study them extensively - all five Gigabytes

of them - and come to the same conclusion I had and change national policy.

I mean, of course, right?

If we do not get this message out to everyone, then nothing's going to change.

In early 2010 EFT bloggers noticed that all these guys who were signing up from Shanghai,

Beijing and they started asking questions about this and that.

They went to Oak Ridge.

They took them around the lab and showed them everything.

And it's funny going to Oak Ridge because they're all about the info and the nano and

the bio and you want to go, "What about the nuclear?"

They never talk about that part, you know?

Well, they get to the end of the trip and the Chinese official's name was Dr. Jiang

Mianheng... interesting about Dr. Jiang Mianheng, his father was Jiang Zemin, who used to be

the premier of China.

So, this is not a poorly-placed guy in Chinese society.

Trained in the United States in Pennsylvania.

PhD in Electrical Engineer from Drexel University; very, very bright guy.

They were under a non-disclosure agreement between our DOE and the Chinese government.

They were unable to say to the rest of the thorium community in the USA and Canada that

they were visited by a top Chinese delegation.

So they get to the end of the meeting and I'm told by Oak Ridge people "You know we

had this great trip.

Have you learned what you wanted to learn?" and they go "We're actually here to learn

about the molten salt reactor.

see, we're going to build one - we've already got a site picked out - and we're going to

have it built by 2020 and we're here to learn everything we can about it."

And the Oak Ridge we were like "Huh..."

The Chinese, who apparently have had a more far-sighted approach to thorium for quite

some time than we have, have been stockpiling it for years, as they mine for rare earths,

since 99% of the rare earths that we use, including those magnets?

Well, when those got mined, there was probably some thorium that came up with it that's probably

sitting in some barrels over in China right now, waiting for Dr. Jhang to finish his experiments

with thorium molten salt reactors and to start putting them to use.

China has committed the equivalent of a billion dollars US, which, by the way, is roughly

the calculations that John and I and others have come up with for the cost of actually

developing your first units.

So, going all the way through I.P. to fully constructed operational units.

This is the most important thing that's going to happen in the next 24 months, and whoever

gets that is essentially going to control the destiny and the roll out of energy for

the foreseeable future.

We believe that the United States should be leading that, I can assure you the plan includes

every single partner that we can bring into this worldwide, our friends in Canada, our

friends in Brazil, our friends in Europe.

If developed outside the United States, the NRC is facing absolutely very real problems

in terms of credibility.

You can't have the world move on without you with what, for all practical and measurable

purposes, is a safer form of energy.

Why are we sustaining an energy system that was the byproduct of the Cold War?

I think, if we can all just kind of go back in time, I'll bet you that all of Europe felt

like America was today's China.

What we did to the Europeans coming out of the first World War, and the second World

War, buying up all the globe's resources, becoming the industrial producer of everything.

It felt very similar.

But, remember, we were about 130 million people back then.

They're 1.3 billion!

They need it.

They need the power, they need to be able to realize the promise of thorium.

But, I'd also like to see us succeed, you know?

We were working on this stuff a long time ago, we made great progress on it.

We set it down in 1974 for kind of dumb reasons, and I think it's high time that we picked

that thread back up again.

We can be competitive with China on making patents on things that weren't thought of

in the 50's and 60's.

But, if we wait, Americans, Canadians, and Brazilians will be buying LFTR and molten

salt technology from China and paying them the royalties.

We buy a lot of things from China already.

It's not as if we're not buying enough things from China.

We are definitely keeping them busy.

So let's -you know- let's... go develop thorium.

Almost every known way to extract rare earths from their mineral concentrates means that

thorium just literally drops out like a rock and you have it.

So while you're meeting the world's rare earth demands, the thorium is free.

So it's going to be the most valuable commodity in the world with almost no value.

Enough people now, thanks to the Internet, are learning about the potential of LFTR and

thorium, and they're asking hard questions.

Mr. President, you often say there are no silver bullets to our energy problems.

Why is the federal government not accelerating research into fluid fuel molten salt reactors

that run on thorium?

Liquid fluoride thorium reactors, this is the kind...

You're already above my pay grade so...

I'll explain it to you because this is the kind of idea Washington needs to know about.

Pretty soon in 10 years we're going to buying these things from them if we don't start making

them right now.

The AEC report given to John F. Kennedy at his request in 1962, addresses directly the

fears that they had, and it specifically outlines what we should have done.

And we have not done it.

We can do the thorium breeder reactor which Weinberg and the Ornell team worked on for

20 years and perfected and operated for four years in the 1960's.

That reactor is exactly what China now has a billion dollars to develop using our plans,

all our research, everything that we did as an American research institution 49 years

ago.

Even if Washington does operate slowly, 49 years does sound to be a little excessive.

If we don't do it, it will still be happening.

It will just be happening in a place like China rather than the United States.

We will be seeing LFTRs being built in the future, make no mistake.

Let's say, for example, you've got a single rare earth refinery creating about 20,000

tons of heavy rare earths a year.

On current consumption, that's about 130 percent of domestic consumption for rare earths.

That automatically undermines China's advantage.

Now, there's two places on the planet Earth where you have a guaranteed supply of heavy

rare earths.

What can your country leverage that into?

This is the fulcrum you need to get back into the world economy as a manufacturer, value

added producer.

On another note, you would produce enough thorium, which would historically have been

dumped in the tailings lakes, to provide power to the entire western hemisphere, and I've

been told in every single presentation that's an understatement.

If we can convince our government to step up to the responsibility of dealing with the

rare earth issue, which means dealing with the thorium issue, put ourselves on the path

for a new era in new US economic growth, and a path towards total energy independence.