The U.S. Has a Plan to Counter China’s Dominance in Rare Earth Elements. The Curious Thing Is Where It Will Be Implemented: In a Toxic Pit of Contaminated Water

The trade war initiated by the U.S. has exposed some of Washington’s weaknesses in supply chains crucial to many strategic sectors. Specifically, China dominates the production of minerals and rare earth elements essential to these industries. Against this backdrop, it recently appeared that the U.S. had financed mines in Brazil for years. However, when it came time to reap the rewards, it found that the mines’ contents had already been sold to China.

That may be why the latest discovery could tip the balance.

From toxic pit to treasure. According to The New York Times, the Berkeley Pit in Butte, Montana, appears to be an environmental disaster at first glance: an abandoned mining crater filled with more than 50 billion gallons of highly acidic and toxic water from acid mine drainage. However, beneath its contaminated surface lies an unexpected resource—a mineral cocktail that could transform this ecological threat into a mine of rare earth elements. These elements are essential for producing electric vehicles and guided missiles.

Due to recent advances in extraction methods, U.S. scientists and companies are exploring ways to harness this liquid waste to obtain neodymium, praseodymium, zinc, cobalt, nickel, and other key minerals. With each F-35 requiring around 880 pounds of rare earths—and with growing geopolitical pressure to reduce dependence on China—interest in exploiting these previously useless resources has skyrocketed.

Water is the new gold mine. “Water is the ore body of the 21st century,” Peter Fiske, director of the National Alliance for Water Innovation, said. Until recently, this view was considered marginal. But it’s gaining ground rapidly as methods for recovering minerals dissolved in industrial wastewater, brines from desalination plants, and mine drainage are developed.

Universities in Indiana, Texas, and West Virginia have developed biomimetic membranes, ion exchangers, and solvent filtration techniques to separate rare earth elements from liquid waste. For example, researcher Paul Ziemkiewicz’s team has successfully converted acid sludge into rare earth concentrates through progressive extraction, a process already used in West Virginia coal mines and now being tested in Butte. The Berkeley Pit’s volume and mineral concentration could produce up to 40 tons of rare earth concentrates annually.

The geopolitics of acid drainage. This kind of liquid mining renaissance isn’t happening in a vacuum. In a global context where China controls most of the rare earth supply—and can manipulate prices or restrict exports in response to sanctions or trade disputes—discovering viable domestic sources has become a national security priority for the U.S.

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The Times reported that the Department of Defense has funded much of the research in Butte. A $75 million investment is expected to build a processing plant to purify the extracted metals and increase production. Washington has also identified countries such as Greenland and Ukraine as regions with key mineral reserves. Plans are also moving forward to extract minerals from the seabed, even in international waters.

Recycling and sovereignty. Rare earth elements are a group of 17 metals, divided into heavy and light categories. Curiously, they’re not scarce—the problem lies in their geological dispersion and complex extraction. This makes them strategic resources, and China an expert in the field. The pollution generated by acid mine drainage, which has affected thousands of miles of rivers in the U.S., also presents an opportunity.

How? These waters oxidize and solubilize minerals such as zinc and copper, allowing recovery with the right technology. The current approach also prioritizes clean, sustainable solutions. For example, “nanosponges”—molecular sponges that capture specific metals—and renewable energy-powered electrolysis are being developed to produce magnesium from desalinated brines. According to The Times, these initiatives are backed by startups such as Magrathea Metals and Lilac Solutions.

These new technologies extract resources with less environmental impact and greater efficiency, eliminating the need for open-pit mining.

Berkeley Pit as a symbol. The story of the pit—from toxic pit to potential mine of the future—perfectly symbolizes the transformation of the extractive industry in a world that demands more minerals but tolerates less environmental destruction.

For decades, the metals dissolved in its waters posed a threat. Today, they represent a promise. If the model developed in Butte is replicated at other contaminated sites in the U.S., it could supply a significant portion of the country’s needs, including the 1,400 tons of minerals required for defense each year.

In addition, global demand for rare earth elements is projected to increase by up to 600% in the coming decades, and it’s clear this promise is becoming increasingly strategic. Ironically, yesterday’s liquid waste points to today’s strategic wealth.

Image | James St. John

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