PERTH (miningweekly.com) – ASX-listed Greenland Minerals has signed a memorandum of understanding (MoU) with shareholder Shenghe Resources Holding to commercialise the Kvanefjeld rare earths project.
The MoU establishes a strategic framework for the two companies to enter future binding agreements covering the offtake of some 32 000 t/y of contained rare earths in chemical concentrate, or 34 000 t/y of contained rare earths in mineral concentrate.
Binding agreements are expected within three months from the mutual acceptance of the Kvanefjeld optimised flow sheet, which is expected in the first quarter of 2019.
The MoU also allows both parties to develop project finance strategies, which could include Shenghe taking an equity investment into the project as part of a joint venture agreement, as well as the development of project-specific rare earth element separation capacity outside of China to directly supply the growing international demand centers.
“This MoU represents an important milestone in the relationship between the company and Shenghe. The agreement builds on the strategic cooperation agreement entered into in 2016 that saw Shenghe become our major shareholder,” said Greenland MD John Mair.
“Shenghe has the capacity, technology and intent to process a variety of intermediate rare earth products from Kvanefjeld and produce high-purity, industry ready products. The significance of Shenghe’s undertaking demonstrates that all project output at planned volumes will be absorbed into commercial end-use markets by a prominent and experienced industry participant.”
The Kvanefjeld project comprises several large multi-element deposits rich in rare-earth elements, uranium and zinc. Collectively, these deposits represent one of the world’s largest identified mineral resources of rare earths and uranium. Kvanefjeld has a total resource base of 1.01-billion tonnes, containing 593-million pounds of uranium and 11.14-million tonnes of total rare earth oxides. Measured resources are estimated at 143-million tonnes.
The company is currently finalising an environmental impact assessment for the Greenland authorities to prepare the way for public hearings, which is the next step in obtaining a mining licence.