Prime Minister Anthony Albanese
Arafura Rare Earths will receive A$840-million in funding from the Australian government to create the nation’s first combined mine and refinery for minerals that are crucial to the clean-energy and defense industries.
The funding will come from the government’s A$6-billion Critical Minerals Facility, the Northern Australia Infrastructure Facility, and Export Finance Australia, Prime Minister Anthony Albanese said in a statement Thursday. Once built, the project in the Northern Territory could supply almost 4% of the world’s magnet rare earths supply, according to Arafura.
The deal comes as Australia works with allies including the US to expand its capacity in critical minerals production and processing in a bid to break China’s near monopoly in the sector. It follows Wednesday’s announcement of government funding of A$550-million to lithium developer Liontown Resources Ltd., to ensure it reaches first production from its Kathleen Valley spodumene project in Western Australia.
“The road to net zero runs through Australia’s resources sector and the development of our critical minerals sector will play a key role,” Albanese said in the statement.
Arafura’s Nolans neodymium-praseodymium open cut mine and associated processing project is 135 kilometers (84 miles) north of Alice Springs and has an estimated mine life of around 40 years. The company’s biggest shareholder is Hancock Prospecting Ltd., controlled by Australia’s richest woman Gina Rinehart, with a 9.1% stake.
Trading in Arafura was halted in Sydney before the announcement. Since hitting a record high in February 2023, its shares have slumped 78%. They closed at 14.75 Australian cents apiece on Wednesday.