MOUNTAIN PASS >> The hope of restarting what was the only rare earth mining and processing plant in the Western Hemisphere — located in San Bernardino County — received a large boost Wednesday when a first bidder surfaced in the bankruptcy process.
ERP Strategic Minerals LLC, has been selected as the first bidder by the Chapter 11 trustee for Molycorp Minerals LLC.
The Mountain Pass mine, located in north San Bernardino County, about 50 miles south of Las Vegas, once employed about 500 before shutting down in summer 2015.
The shutdown happened just four years after a redesigned and re-engineered state-of-the-art processing facility, costing some $1.7 billion, became fully operational.
A decline in rare earth mineral pricing was a major factor in the decision to suspend production, officials said at the time.
If ERP is successful in purchasing the Mountain Pass mine through the Chapter 11 bankruptcy sale process, it will work with San Bernardino County and others to restart the mine, the company said in a statement.
In bankruptcy parlance, the first bidder is known as the “stalking horse bidder.”
“We are today (Wednesday) pleased to note the stalking horse bid submitted by ERP Strategic Minerals for the Mountain Pass mine,” said David Wert, San Bernardino County spokesman.
The opening bid post held by ERP Strategic Minerals, which is part of the ERP Group of Companies, in Natural Bridge, Virginia, “does not mean we are a winner,” said Mike Luther, spokesman.
“At this junction, we believe there are other interested parties,” he said.
Joining ERP Strategic Minerals in its effort to purchase the Mountain Pass Mine from bankruptcy court is Pala Investment Ltd., a Swiss-based company focused on mining and metals, and Peak Resources Ltd., an Australian firm, which has been pursuing development of a rare earth mine in Tanzania.
Luther anticipates that if this group is successful in acquiring the rare earth assets, it will seek large industrial investors.
Rare earth minerals like those found in the Mountain Pass area are used in the hybrid and electric car industry, for Department of Defense uses and in consumer electronics.
“This mine is a natural treasure for our nation,” Luther said.
The bankruptcy is proceeding in U.S. Bankruptcy Court for the District of Delaware.
June 2 is the deadline for submitting bids and an auction is expected to occur June 6. The anticipated closing date is June 27, according to the trustee’s sale motion.
The ERP Group has completed seven transactions through insolvency proceedings in the last two years and has expected 2017 revenues of more than $2 billion.
