Congressman Faleomavaega announced today that the Foreign Affairs Subcommittee on Asia and the Pacific conducted a hearing on “China’s Monopoly on rare earths and its implications for U.S. Foreign and Security Policy.” Witnesses included Mark A. Smith, President and CEO of Molycorp Inc.; Robert Strahs, Vice President and General Manager of Arnold Magnetic Technologies; John Gaylen, President of Danfoss North America; and Ms. Christine Parthemore, Fellow for the Center for a New American Security.

“Last week, the Resources Subcommittee on Energy and Mineral Resources held a hearing on H.R. 2803 which I introduced for purposes of conducting an assessment of the seabed area around the U.S. continental shelf including areas that are contiguous to and within the 200 miles economic exclusive zones (EEZ) of the United States territories and possessions, for nonfuel minerals, which are known to include an abundant supply of rare earth elements (REEs),” Faleomavaega said.

“While it is unfortunate that Samoa News published a letter entitled “Stick to a Clear and Consistent Message” signed by an anonymous person named ‘A Constituent’ that suggested that H.R. 2803 is ‘a cheap publicity stunt,’ and this was done only after a rare earths conference was held in Fiji in June of this year, the truth of the matter is H.R. 2803 is built upon similar legislation I introduced in 2009 (HR 2834) and again in 2010 (H.R. 4792).

“My proposal would require the U.S. Department of the Interior’s Bureau of Ocean Energy Management, Regulation and Enforcement (BOEMRE), in consultation with other appropriate agencies, to conduct an assessment of the seabed area around the U.S. continental shelf including areas that are contiguous to and within the 200 miles economic exclusive zones (EEZ) of the United States territories and possessions, for nonfuel minerals. It will cover seabed areas around American Samoa, the Commonwealth of the Northern Mariana Islands, Guam, Puerto Rico, the Virgin Islands, Midway Islands, the Federated States of Micronesia, Palau, Marshall Islands, Wake Island, Johnston Atoll, Baker, Howland, and Jarvis Islands, Kingman Reef, Navassa Island, Serranilla Bank, Bajo Nuevo Bank, and Palmyra Atoll.”

“Contrary to the claim made by ‘A Constituent’ that there is no connection to the U.S. continental shelf, the intent of H.R. 2803 is to include both the shallow and deep bed of the United States.  In addition, the bill gives great deference to our environmental concerns and the need to protect our natural resources.”

“While some may wonder what this bill has to do with American Samoa, research shows that there is considerable economic potential for seabed mining in the Pacific Region.  Past studies have revealed rich deposits of nonfuel minerals within the Exclusive Economic Zone (EEZ) of the Cook Islands and both Samoas.  Manganese nodules, typically rich in manganese and iron oxides, are known to also occur in the EEZs' of Fiji, Tonga, Tuvalu and Kiribati according to information provided by the Secretariat of the Pacific Community's Applied Geoscience and Technology Division (SOPAC). Indeed, the recent SOPAC workshop held in Suva, Fiji underscored the potential for seabed mining industry in the Pacific Island region.”

“Concerned by these developments and also knowing of the potential for the U.S. and its territories, I introduced H.R. 2803, for purposes of assessing how we might be able to recover nonfuel minerals from the shallow and deep bed of the United States since these deposits are known to include an abundant supply of rare earth minerals.”

“And while the United States was once self-reliant in domestically produced REEs, over the past 15 years, 100% of our rare earths are now imported, mostly from China.  This is cause for great concern. Our reliance on the import of these nonfuel minerals could pose significant risk to our nation, especially given our current economic condition.  Any disruption in the world supply of these valuable minerals could have significant consequences on the costs of many goods and services, with reverberations that are sure to be felt across America including here in the Territory,” Faleomavaega warned.

“Data from the United States Geological Service (USGS) estimated that in 2010, the added value to Gross Domestic Product by major industries that consume processed nonfuel mineral materials, including rare earths, was $2.1 trillion (14%) of the total U.S. Gross Domestic Product (GDP) ($14.6 trillion) – a considerable portion of our nation’s economy.”

“As it was then, the current bill, H.R. 2803, focuses attention on nonfuel minerals including rare earths.  Why do rare earth elements, or REEs, matter?  Like I said at today’s hearing, they matter because these elements are used in military systems we count on to protect us – like antimissile defense and space-based satellite and communication systems.  REEs are used to power clean energy.  They are used in medical devices, jet fighter engines, the automotive industry, color television and flat panel displays like cell phones, portable DVDs, laptops, etc.”

“The bottom line is that the U.S. is way behind on the technological capability needed to harvest and make use of these nonfuel minerals including rare earths.  Countries like China, India, and Russia, have taken over the lead in the exploration and research of nonfuel minerals.  I believe the bill, H.R. 2803, is an important first step in what should be a comprehensive effort to ensure that the U.S. reengages and reasserts itself as a leader in domestically producing these valuable minerals,” Faleomavaega concluded.