Australia's Arafura reaches FID for rare earths project

Australian minerals developer Arafura has made a final investment decision (FID) for the 4,870t/yr Nolans rare earths project, which will begin 30 months of construction in September and start production in early-to mid 2029, the company told Argus today.

Nolans will produce 4,440 t/yr of neodymium-praseodymium oxide, a light rare earth used in small quantities in rare earth permanent magnets (REPM) which are critical for the automotive, wind energy, and high-technology sectors. The company will also produce 470 t/yr of mixed medium-heavy rare earth oxide and 144,000 t/yr of 54pc P2O5 fertilizer-grade phosphoric acid from the project.

The board reached FID after receiving a non-binding letter of support from Export Finance Australia (EFA) for 500 t/yr of NdPr under the country's Critical Minerals Strategic Reserve (see table), which brought Nolans over the targeted 80pc offtake threshold, the company said today.

The EFA commitment followed a A$200mn ($144mn) investment from Australia's National Reconstruction Fund on 12 May and an offtake agreement with commodity trader Traxys North America for 500 t/yr NdPr on 13 May.

Arafura also has offtake agreements with South Korean automaker Hyundai, Germany-based industrial manufacturer Siemens, and Traxys Europe.

Arafura now has 3,570 t/yr of NdPr, or 80.4pc of its nameplate capacity, contracted for offtake. The remaining 870 t/yr is currently uncontracted and will be sold on the spot market.

Nolans has a mine-life of 38 years and the company projects it will meet 4pc of global NdPr demand.

By Daniel Gage-Brown