Elk Creek Niobium Project Moves Forward

April 9, 2014, 6:30 a.m. ·

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The village of Elk Creek in southeast Nebraska is small, home to just 100 people. However, these residents could soon see a relatively large influx of people and money, as plans to develop a nearby niobium deposit move forward.

A 70-acre field south of Elk Creek is drawing lots of attention.

Birds and other wildlife comb over the ground, searching for remnants of last year’s harvest.

The "hot spot" of the Elk Creek niobium deposit is in a field behind this farmhouse. Located so close to Highway 50, former State Senator Tony Fulton said the existing infrastructure is promising in regards to a potential niobium mine being constructed. (Photo by Ryan Robertson, NET News).

This image is from 2011, when Niocorp drilled several holes in and around the "hot spot." Mining deposits are graded on three categories: measured, indicated, and inferred. Part of Niocorp's plan moving forward is to increase the amount of niobium in the measured and indicated categories, a process Niocorp's President Peter Dickie called "proving up." (Photo by Bill Kelly, NET News).

From the cab of his pickup, Scotty Gottula explains birds aren’t the only ones looking for buried treasure under the soil. A Canadian mining company has been doing some digging of its own.

“They’ve poked holes all over. This right here is the hot spot of the whole area,” Gottula said, “They’ve poked like two holes going across this field. Another hole just into the trees. Another couple of holes up on the hill. This is the concentrated area right down in here.”

The holes were poked as part of an effort to develop a mining operation in the area--or under it to be more specific. The mine will harvest a relatively unknown material called niobium.

Gottula admitted he didn’t know much about the element, other than it’s important.

“All I know is they use it to harden metal, you know for airplanes. The same as you read in every story. None of it is really produced in the United States,” Gottula said, and he is right.

Niobium is used to make steel stronger and more light-weight. It’s used in everything from nose-rings to skyscrapers to bridges to jet engines.

85 percent of the world’s niobium comes from a private company in Brazil. The U.S. currently imports 100 percent of its niobium needs.

Peter Dickie is the director and president of Niocorp, the Canadian based company with rights to the Elk Creek deposit.

At a time when other mining companies are going bankrupt, Niocorp recently raised $5.5 million through private capital investment.

“The indications and the numbers that we’ve been able to produce internally are sufficiently positive to very much encourage us to move this project forward,” Dickie said, choosing his words carefully.

Niocorp will need to develop a partnership with a larger mining company to construct the mine and harvest the deposit, which makes the capital raised all that more important.

This image of crystallized niobium shows the element before it's used in making steel. Niobium is added during steel manufacturing to make the final product stronger and lighter. Experts say the benefits of stronger, lighter steel could have far reaching impacts in industries like automobile manufacturing and construction. (Image courtesy of Rio Grande Blog).

The money will fund a feasibility study to determine exactly how much niobium is underground, and how best to get it.

“And that’s along the lines of geo-technical knowledge, hydrological knowledge, so we can adequately plan for location of facilities such as a mine shaft and also allows us to plan and adequately deal with other issues such as ground water and any surface impact, that sort of thing,” Dickie said.

Dickie added he’s optimistic the Elk Creek mine will be operational by late 2016, and employ around 150-250 miners. He emphasized these workers will be locally-sourced as much as possible.

While the talk of an economic windfall blowing into town is exciting, it’s something Elk Creek and Johnson County residents have heard before.

Since the 1980’s, there’s been plenty of interest in their niobium deposit and how much money it could bring to the area.

But those who’ve lived in the area long enough know, just like back then, if demand for niobium goes away so does the mine.

Still, the fact Niocorp raised enough money to move ahead has Scotty Gottula and his neighbors eager to know what happens next.

Conversations in Johnson County about the project often draw comparisons between Elk Creek and North Dakota, where thousands have flocked as part of the oil-fracking boom going on there while other industries struggle to keep up.

Gottula, who is also the chairman of the Johnson County Commission, said one of his major concerns is making sure the county is ready for a boom of its own.

Scotty Gottula (left) talks with a neighbor about the potential niobium mine and its impact on the area. Gottula said many in Johnson County choose to live there because of the "way of life it offers." He said a niobium mine could attract hundreds of job seekers to the area, and would increase the county's tax base. (Photo by Ryan Robertson, NET News).

“So that we have the right zoning in place to not hinder the operation. And what kind of infrastructure does it take to get it in, get it out? How do they ship it out? Does it go out on rail? Does it go out on trucks? And I don’t know if they’re to that stage yet that they know,” Gottula said.

Most of the answers he’s looking for hinge on the outcome of Niocorp’s feasibility study. But former State Senator Tony Fulton, who now sits on Niocorp’s board of advisors, said folks like Gottula just need to keep being patient.

“A question I’ll get a lot is, ‘Well, they say there’s infrastructure in place, you’re from the area. Is there really?’ Yeah. You go to Google maps, it’s right there. There’s a railroad spur less than a mile away, the highway runs right by it. Just folks of Elk Creek, sit tight,” Fulton said.

Both Fulton and Dickie acknowledge the plans to develop the Elk Creek deposit have gone slower than they’d liked, mainly because capital investments all but disappeared during the recession.

Dickie said while he’s confident the project will now start to pick up steam, he was quick to note Niocorp won’t rush this process.

“We don’t try to over-promise to anybody. We certainly stick to a strong corporate philosophy that if it takes a little bit longer time and a little bit more money to do it the right way, that’s the way we’ll go,” Dickie said.

His message of “doing it right” isn’t lost on Gottula, who said he will continue to approach the possibility of a mine near Elk Creek…conservatively.

“Nobody is doing cart wheels because they raised another $5.5 million,” Gottula said. “They’ll just go punch some more holes, and we’ll see what happens.”