Gina Rinehart backed Arafura Rare Earths (ASX:ARU) has updated the market on major debt funding milestone accomplishments, ultimately moving closer to FID.
All in all, the company has secured over US$1B in funding from different sources. Perhaps surprisingly, shares were flat on Tuesday, trading at 19cps.
The company’s flagship project, Nolans, will be an Australian-based critical minerals project geared towards supplying the domestic economy and those of our allies.
In short: separating from China where dominance in the rare earth (REE) industry is concerned. “Developing a diversified [neodymium & praseodymium] global supply chain,” is how the company puts it.
Neodymium & praseodymium (NdPr) are the magnetic rare earths that go into everything from wind turbines to some batteries and other green tech solutions. Once called “high value magnetic rare earths” by most explorers on the ASX, that moniker has faded as Nd prices slumped over the last 12 months.
This is not particularly good news for a new mine, but given the sheer volume of capital behind it – much from Canberra – it appears a positive FID is likely. Ironically, the project designed to break away from China is hampered by lower prices driven by subdued Chinese demand.
The company recently won favour from the German export agency for $171M. That saw an offtake deal locked in for wind turbines down the road.
Albanese gave the company nearly $1B while the company recently got another US$300M funding pathway.
It appears unlikely that FID won’t move ahead, though, crazier things have happened.
ARU last traded at 19cps.