PERTH (miningweekly.com) – Rare-earths developer Arafura Resources has selected a site for its processing complex in South Australia.

The ASX-listed Arafura has signed an exclusivity deed with OneSteel Manufacturing, a subsidiary of OneSteel to purchase around 800 ha of land at Whyalla.

The deed allows for Arafura to gain immediate access to the site in order to progress a detailed engineering and environmental study, while the parties finalise the sale and purchase agreement.

This transaction would likely be concluded by the end of the year.

Arafura MD and CEO Steve Ward said that the site selection decision followed a comprehensive review of potential sites over the entire Australia.

“This marks a great step forward for Arafura in delivering the Nolans project,” said Ward.

The Nolans project would start production in 2013, and hosts an estimated 850 000 t of rare-earth oxides, 3,9-million tons of phosphate pentoxide, and a further 13,3-million pounds of uranium.

“The Nolans project will create significant value for both the Nolans ore mine, in the Northern Territory, and the rare-earths complex in Whyalla, South Australia,” he added.

The complex would be a substantial mineral processings and chemicals manufacturing facility, by Australian standards, Ward said.

Meanwhile, the final decision to proceed with the construction of a rare-earths complex would be made following the completion of a bankable feasibility study and project finance issues.

“The signing of the deed is further evidence that Arafura is committed to delivering on its stated objective to be the recognised leading supplier of rare earths to users worldwide from 2013,” Ward concluded.

To subscribe to Mining Weekly's print magazine email subscriptions@creamermedia.co.za or buy now.