JOHANNESBURG (miningweekly.com) – Rare earths company Arafura Resources reduced the operating costs for its Nolans project, in the Northern Territory, by 15%, the company announced on Wednesday.

Operating costs were lowered to A$12.36/kg, which MD Gavin Lockyer said entrenched Nolans in the lowest quartile of the cost curve.

“This is important given the general softening of many rare-earth prices over the last 12 months,” he commented.

Further improvements in the operating costs should assist the company to advance and finance Nolans when the broader rare earths market improved.

“Our forecasts indicate this market will grow by 10% a year over the next ten years and analysts believe this will be driven by new, rather than existing technologies. Current supply simply cannot keep pace with demand,” Lockyer said.

The 15% saving in operating costs came after capital review studies suggested the resizing of equipment, laboratory-scale testwork identified process improvement efficiencies and studies as part of the Nolans environmental-impact statement confirmed that the estimated workforce would be fewer than previously expected.

Meanwhile, Arafura reported that work was under way to further enhance the Nolans project. One focus area was to review the impact of a reduced mining rate on rare earth oxide production. The company has reviewed the mining schedule for Nolans to optimise the mining rate to provide upfront capital savings and to defer capital expansions to well after any initial project finance period.

Arafura was also investigating whether the project could benefit from the production of commercial quality by-products, such as phosphates, which were currently report to waste streams.

“If a merchantable phosphate product can be realised rather than ending up as waste this will have a number of advantages, including enhanced project returns and a reduced environmental impact at Nolans,” Lockyer commented.

Arafura is hoping to start production at Nolans in 2019, with production targeted at 20 000 t/y of rare earth oxide equivalent.