Sheep Creek rare earths project in Montana hosts 13 US critical metals

With the transition to electric vehicles charged with low-carbon energy shining a spotlight on America's need for secure and reliable supplies of critical minerals, the Sheep Creek project in southwestern Montana has emerged as a potential high-grade domestic source of nine rare earths and four other metals that have been deemed critical to the United States.

High-grade rare earths were found at Sheep Creek during niobium exploration in the early 1960s. At that time, however, there were no uses for this enigmatic group of elements that are now critical to modern technologies.

Because this property along the Montana-Idaho border has largely flown under the radar until the recent acquisition by U.S. Critical Materials Corp., very little modern exploration has been carried out to understand the full scope of mineralization in the more than 50 rare earths enriched carbonatites that have been found outcropping across the 4,500-acre property.

This dearth of modern geological information, however, is about to come to an end.

In July, Vancouver, British Columbia-based US Critical Metals Corp. entered into an agreement to earn up to a 75% joint venture interest in Sheep Creek and Lemhi Pass, a rare earths project in southeastern Idaho, by paying U.S. Critical Materials US$500,000 in cash and investing US$9.5 million in exploration and other activities to advance the Montana project over the next five years.

"The investment by U.S. Critical Metals gives U.S. Critical Materials the financial strength to aggressively pursue the development of the Sheep Creek, Montana property," said U.S. Critical Materials President James Hedrick.

13 US critical minerals

The limited modern exploration carried out so far at Sheep Creek has turned up 13 of the 50 minerals and metals that have been deemed critical to the United States. This includes nine rare earth elements, gallium, niobium, scandium, and yttrium.

Sampling carried out by U.S. Critical Materials indicates the potential that this Montana property could host some of the highest rare earth grades in the U.S.

Samples collected so far have contained as much as 18% total rare earth elements. What is particularly intriguing is the high percentage of neodymium and praseodymium, a pair of rare earths that are used in the powerful magnets that go into EV motors, wind turbine generators, and a wide range of other high-tech and household goods. Samples with as much as 2.4% combined neodymium and praseodymium have been collected from the Sheep Creek carbonatites.

Another surprising advantage of the Sheep Creek rare earth mineralization is the unusually low levels of thorium, a radioactive element often associated with rare earths deposits that require special permitting and disposal protocols in the U.S. if levels exceed 500 parts per million.

The levels of thorium at Sheep Creek have been found to be 200 ppm, which is significantly below the permitting threshold established by the Nuclear Regulatory Commission.

"The high-grade rare-earth indications together with the low thorium readings are a unique combination," said Hedrick.

While the low thorium levels make permitting both exploration and potential future production easier, it makes exploration a little harder.

Typically, exploration companies can use sensors to detect the radiation given off by this element to detect the mineralization underground. The low thorium levels at Sheep Creek mean that geologists must depend on more traditional geological techniques to know the most likely locations to trace the outcropping critical minerals exploration underground.

National interests

The high grades of rare earths and other critical minerals, coupled with the low grades of thorium, have attracted the attention of the US Army Research Lab, which is funding Montana Technological University's ongoing research being led by Sarah Risedorf at Sheep Creek.

"The US Army Research Lab sponsoring Sarah and her team is a significant indication of the critical need for the rare earths currently being targeted at Sheep Creek," Hedrick and U.S. Critical Metals CEO Darren Collins penned in a joint statement.

Risedorf recently presented findings from the Sheep Creek rare earth project, which included the collection of 40 bulk samples gathered from outcropping carbonatites, at the Society of Economic Geologists' 2022 conference in Denver, Colorado.

"Sheep Creek contains elements essential for both civilian and military applications and we extend our thanks to Sarah for investing her time and expertise in showcasing our Sheep Creek Rare Earth Project in Montana," Hedrick and Collins added.

US Critical Materials' discovery has also attracted the interest of geologists at both the state and federal levels.

With funding from the U.S. Army Research Lab, Montana Tech is collaborating with the U.S. Geological Survey, Montana Bureau of Mines and Geology, Idaho Geologic Survey, and US Critical Materials on a comprehensive investigation of Sheep Creek mineralogy.

USGS and Montana Tech are also undertaking detailed mapping of the Sheep Creek district and conducting stream sediment surveys.

Critical Metals exploration

In the midst of the flurry of activity by Montana Tech, Montana Bureau of Mines and Geology, Idaho Geologic Survey, and USGS, US Critical Metals is ramping up its first round of exploration at Sheep Creek.

To earn up to 75% joint venture interest in Sheep Creek, along with the Lemhi Pass rare earths project just across the border in Idaho, US Critical Metals has agreed to invest as much as US$10 million over three phases.

"This partnership positions U.S. Critical Metals with increased exposure to commodities essential to U.S. security of supply and national security interests," said Collins.

To earn an initial 25%, US Critical Metals paid U.S. Critical Materials US$300,000 and has agreed to invest an initial US$1.5 million in exploration over the first 16 months.

This initial round of exploration, which is currently being ramped up at Sheep Creek, will include geologic mapping, sampling, and analysis to identify targets for drilling that is expected to begin early next year.

Following this initial phase of exploration, US Critical Metals has the option to increase its stake to 50% by paying US$200,000 in cash and investing an additional US$3 million into exploration over the next 40 months.

U.S. Critical Materials Corp.

A carbonatite sample collected from Sheep Creek with bands of allanite rare earth mineralization.

This second phase of exploration is expected to primarily involve further drilling to begin outlining critical minerals deposits at Sheep Creek.

To earn a 75% interest in Sheep Creek and Lemhi Pass, US Critical Metals would fund an additional US$5 million for a third phase of exploration and other work toward advancing development at the Montana and Idaho rare earths projects over 64 months.

If the mineralization found on the surface is any indication, this extensive exploration and early development work would position Sheep Creek as a significant domestic source of 13 elements critical to the national security and economic well-being of the U.S.

"I believe that U.S. Critical Materials has the potential to be a top U.S. rare-earth producer," Hedrick said.