Venezuela has long been known for its immense oil riches. While that may be the case, it could have huge potential in rare earth elements. These 17 metallic elements, like cerium, dysprosium, neodymium, and samarium, are critical to the U.S. economy. They are vital for all sectors from defense to technology. The United States is taking a fresh look at how much we rely on imported critical minerals. At the same time, unverified deposits in Venezuela have been testing waters, especially in light of continued trade hostilities between the US and China.
The conditions for rare earths have changed drastically in recent years. In 2024, China was responsible for more than 90% of global rare earth refining. This unchallenged hegemony has led to national security and economic concerns among US lawmakers. In response, the United States is accelerating efforts to industrialize its own rare earth mining and refining capabilities. These advocacy projects still sometimes face real and sometimes massive backlogs and timelines, often taking many years or decades before completion.
Venezuela’s Rare Earth Elements
Venezuela’s estimated reserves of rare earths are not fully explored or proven. The country has enormous mineral wealth, including coltan and bauxite. At the same time, these resources are becoming increasingly valuable commodities in the global market. In his time, President Hugo Chávez worked hard to assert the value of Venezuela’s natural bounty. Since a huge reserve was supposedly found in 2009, he called coltan “blue gold.”
In response, Nicolás Maduro’s government created the Orinoco Mining Arc in 2016 to spur exploration and production of valuable minerals. This initiative is meant to help woo foreign investment and stimulate domestic extraction of several critical minerals, rare earths among them. Companies face huge reputational and legal risks while undertaking mining activities in Venezuela. Security threats and the need for continuous assurances further hamstring their efforts.
“There is an awareness within the administration that even beyond oil, there’s wider natural resource value in the country.” – Reed Blakemore
Even with this knowledge, the extraction and commercialization of these resources pose unique and challenging issues.
The Importance of Rare Earths
Rare earth elements are more commonly referred to as critical minerals, owing to their essential and irreplaceable function in high-tech and defense-related applications. The US Geological Survey has identified 14 of these elements as critical to national security. As industries increasingly depend on advanced technologies that require rare earths, the stakes rise for countries seeking reliable access to these materials.
Despite the name, “rare earths” is a misnomer. Indeed, the elements are relatively prevalent in the Earth’s crust. Their extraction and processing involve skills and facilities that many of these countries do not have. As a result, countries like China have kept the United States at bay in this area.
“China still holds near-singular capacity to process rare earth metals, and that industrial and geopolitical edge cannot be overcome overnight.” – Joel Dodge
The ramifications of this reliance on foreign providers have sparked debate in US government circles about shoring up domestic capacity.
Challenges Ahead
Venezuela’s rare earth resources seem a potential boon, major challenges still lie ahead. For most mining and refining projects, the timeline can stretch into years or even decades because of the complexities at play. To top it off, the political landscape in Venezuela adds an even greater challenge. Continued economic turmoil and uncertainty over democratic governance have sown doubt among potential investors.
“However, if we’re talking about the conditions under which we are able to exploit those mineral resources and bring them to market, it’s a much more challenging story.” – Reed Blakemore
Thought leaders from across industries are aware that the issue at hand is complex and must be treaded upon with caution. Tapping into Venezuela’s rare earth rewards might be just as fruitful. We need to be realistic about the fears and dangers of playing in this intensely uncertain landscape.