Australian minerals developer Arafura Rare Earths has extended a binding offtake agreement with an existing partner, specified only as a global wind turbine original equipment manufacturer (OEM), for up to eight years.
The extended deal will cover 500 t/yr of neodymium praseodymium (NdPr) oxide equivalent for five years, with an option to extend it to eight years, the company said on 18 September.
The offtake volumes will be priced against a global seaborne index, the company said, adding that it will no longer disclose the identities of offtake partners to protect commercially sensitive information.
Arafura signed a five-year offtake deal with Germany-based manufacturer Siemens in 2023 for use in its offshore wind turbines. The deal had an option to extend for a further two years, and covered up to 400 t/yr of NdPr metal or 520 t/yr of NdPr oxide equivalent over the term of the deal. The deal stipulated financing and project development milestones for Arafura, to be met by 30 September 2026 unless otherwise agreed.
Arafura reached a final investment decision on its Nolans project in the Northern Territory in May. It expects to begin production of 4,440 t/yr of NdPr oxide and 470 t/yr of mixed medium-heavy rare earth oxide containing dysprosium and terbium (DyTb) by early-to-mid 2029.
NdPr and DyTb are used in neodymium-boron-iron (NdFeB) rare earth permanent magnets, which form a critical part of direct-drive wind turbines. Direct-drive wind turbines do not need a gearbox, which greatly reduces the frequency of mechanical failure, according to the IEA.
Wind energy sector demand for NdFeB magnets in the is growing faster than electric vehicles (EVs). The rate of global wind power installations is projected to more than triple from 9.25 GW/yr in 2025 to 33.65 GW/yr in 2030, according to Argus Analytics. Meanwhile, global EV sales are expected to increase by around 61pc to 38.8mn units/yr in 2030.
Argus-assessed NdPr oxide min 99pc cif Europe was up $4/kg on the week at $115/kg on 17 September (see graph).
