ASX-listed Australian Rare Earths has validated its Koppamurra rare earths project as among Australia's most advanced ionic clay projects, confirming strong returns, low capital requirements and a clear path to production in a prefeasibility study (PFS).

The company also published a maiden ore reserve and updated mineral resource estimate for the project, declaring a maiden ore reserve of 26-million tonnes grading 920 parts per million (ppm) of total rare earth oxide (TREO).

Australia Rare Earths says the ore reserve is the most significant de-risking milestone yet and underpins potential mine planning, financing and development. The ore reserve grade is 22% higher than the global mineral resource average grade of 751 ppm of TREO, highlighting the optionality for mine sequencing across a large, regionally extensive orebody.

About 48% of the company's rare earth basket comprises high-value heavy and magnet rare earths.

Moreover, the updated mineral resource estimates 243-million tonnes grading 751 ppm TREO for Koppamurra, with the resource having increased by seven-million tonnes compared with a September 2024 estimate.

PFS FINDINGS

The Koppamurra PFS finds an after-tax net present value of A$858-million for the project, an internal rate of return of 99% and a payback period of 0.9 years.

The project's initial capital expenditure is estimated at A$178-million to reach 1 860 t/y of TREO production over an initial 12-year mine life, at an all-in sustaining cost of $38.32/kg of TREO.

The PFS confirms the viability of a shallow openpit mining operation, a simple heap leach flowsheet and rapid progressive rehabilitation, which all lower technical risk on the project.

Given the project's large resource base, there is a clear mine life extension potential.

Australian Rare Earths says Koppamurra has a viable capital efficiency ratio rarely seen in the resources sector.

The company says it will now accelerate offtake discussions with strategic partners as pilot-scale operations deliver mixed rare earth oxide samples to potential customers. Pilot-scale operations are due to start imminently at ANSTO's new world-class piloting facility in Sydney - marking a first of its kind piloting programme for an Australian ionic clay rare earths project.