ASX-listed Australian Strategic Materials (ASM) has been awarded a A$5-million grant from the Australian federal government’s International Partnerships in Critical Minerals (IPCM) programme.

The funding, which will be matched by ASM, is set to advance the company's rare earths production plans at its Dubbo project, in New South Wales.

In a media statement, ASM said the the IPCM grant would be used to support its rare earth options assessment and pilot programme that would explore lower capital and faster pathways to rare earths production. This programme would be conducted ahead of starting front-end engineering design (FEED) work. 

ASM would be working with international partners, DRA Global and Stantec, as well as local service providers Mining One and Core Metallurgy to deliver the programme.

These activities are critical to ASM progressing key funding activities and taking final investment decision (FID) in the first half of 2026.

The Dubbo project is ASM's flagship critical minerals deposit, expected to produce a wide range of rare earth and critical mineral oxides essential to global energy transition efforts. The project is poised to strengthen Australia’s role in the rare earth supply chain, supporting international commitments to energy security and emissions reduction.

“This funding recognises the Dubbo project’s national and international strategic importance. With this funding, we will be able to undertake important work to identify lower capital and shorter implementation pathways to unlock rare earth production at the Dubbo project and ensure a focused completion of our final FEED,” said ASM MD and CEO Rowena Smith.

The funding support is in addition to ASM’s recent capital raise activities and its current discussions with the Export-Import Bank of the United States regarding ASM’s application for funding under the engineering multiplier programme. Together, this funding will enable the company to advance critical activities to reach FID on the Dubbo project and transition into the construction phase.

ASM is building a mine to metals business to extract, refine and manufacture high-purity metals and alloys for a global customer base. The Dubbo project will develop a secure, sustainable source of rare earths and critical minerals, strengthen mid-stream processing capability in Australia, drive renewable energy adoption and create jobs and investment in regional Australia.

"Government support to refine rare earths is important for our sovereign capabilities and will help our trading partners meet their economic, national security and emission reduction commitments,” said Resources Minister Madeleine King.