PERTH (miningweekly.com) – Multi-commodity miner and explorer Alkane Resources on Wednesday told shareholders that it was in no hurry to develop its zirconium, niobium, hafnium and rare-earth project near Dubbo, in New South Wales.

Speaking at the company’s annual general meeting, chairperson Ian Gandel said that while electric vehicle production and sales were growing steadily, meaning manufacturers were under pressure to source sufficient volumes of critical minerals, manufacturers were expecting new entrants into the supply market to supply at a substantial discount to established Chinese domestic producers.

“Your company is well positioned with a low-risk, permitted and development-ready project, and it is not appropriate to bind our company to an inferior pricing position for many years, nor is it in Australia’s national interest.”

Gandel said that the company believed that the market dynamics would change in the near term, with market conditions for the Dubbo material continuing to tighten.

Foreign policy decisions such as the US’ commitment to pursue the development of high performance metals, as well as legislation that discouraged the US Department of Defense’s use of rare earth magnets from China, all helped to tighten the supply market.

Furthermore, China’s Made in China 2025 policy is also expected to reduce access to, and increase the prices of rare-earth products, sourced from China, while the tariffs on Chinese goods imposed by the US, and the escalation in the trade tensions between these two nations, were expected to lead companies to seek alternative suppliers.

“We are financially well positioned to persist to seek an offtake on fair terms, and are currently interfacing with the Australian government and Export Credit Agencies to further our project. Your board remains very optimistic in the prospects for the Dubbo project,” Gandel said.

The development of the Dubbo project is expected to cost between A$1.23-billion and A$1.5-billion, depending on the development option that Alkane settles on.

The base case one-million-tonne-a-year throughput rate, is expected to cost A$1.29-billion to development, with an additional A$124-million in sustaining capital required over the 20-year operating life.

The project is likely to be developed in 500 000 t/y stages, with Stage 1 requiring a A$808-million investment, and Stage 2 a A$692-million investment.