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South Korea’s state-owned commodities developer held talks in North Korea last year about a possible North-South project to develop North Korea’s rare-earth deposits, an official at the company said Monday.
The talks took place in November as part of a second round of discussions over a graphite development project in the North that Korea Resources Corp., or Kores, invested in about a decade ago. That project has been stalled since 2010.
Jointly developing rare earth mines is a possibility “but the precondition is always this: an improvement in the North and South Korea relationship,” said the Kores official. For now the potential project is on hold, he said. The official declined to be named.
During the November visit, Kores received samples of North Korean rare earths. Kores analyzed the samples, some of which turned out to be “good,” the official said.
North Korea makes occasional claims to have large deposits of rare earths, a potential source of hard currency for the impoverished nation. There are no reliable data on North Korea’s rare earth deposits.
China controls about 95% of the world’s rare-earth production. Rare-earth minerals are used in products ranging from consumer electronics to batteries to defense systems.
Kores invested 6.25 billion won ($5.5 million) in 2003 to jointly develop a graphite mine in North Korea. The project has capacity to produce as much as 3,000 tons of graphite annually and the deal allows Kores to take half of the annual produce for 20 years, according to the official. So far, Kores has collected 850 tons of graphite.
Economic ties between North and South Korea remain almost completely suspended following two attacks on South Korea in 2010 by the North that killed 50 people.
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