Lynas shares jumped sharply after it lifted resource estimates today and said it could become the world’s No 2 producer of rare earths.

A 19.4 per cent lift in the resource estimate for its Mount Weld project in Western Australia was announced today, and Lynas said it now expected to deliver 1.4 million metric tons of rare earth oxides when production starts next year.

The forecast production level would make Lynas the biggest producer of rare earths outside of China.

Rare earths are used in electronics and hybrid-car technologies, and 90 per cent of the world’s resources of the metals are now found in China.

Shares in Lynas jumped 7 per cent today, adding 8 cents to $1.15 after a high of $1.18. The benchmark S&P/ASX 200 index was higher by 0.3 per cent at the same time.

Lynas said it had divided the Mount Weld resource into two deposits, with the newly-designated Duncan deposit to the north, east and south of the main Central Lanthanide Deposit seeing a threefold increase of ore to 7.62m tons.

That resource contains 4.8 per cent rare earth oxides, giving a total of 366,000 tons of oxides in the deposit.

Mining resources indicate quantities of ore in the ground, and are a preliminary estimate before reserves, which show the quantity of ore that is economically recoverable.

(Source: TheAustralian.com.au)