London-listed Harena Rare Earths has signed a project development funding agreement (PDFA) with the US government's international investment arm, the US International Development Finance Corporation (DFC), which has committed up to $4.84-million towards the agreed project development budget for Harena's Ampasindava ionic clay rare earths project, in Madagascar.

Harena says the signing of the PDFA is a transformational milestone for the company, marking the US DFC's first direct financial commitment to the Ampasindava project and formalising a partnership that the company believes will be central to unlocking the project's development towards production.

Under the terms of the PDFA, the DFC has committed to fund a substantial share of the agreed budget of project development costs, with all associated terms now settled and drawdown of the first tranche of funds already under way.

The proceeds are earmarked for permitting, environmental and social studies and the development of Harena's proof-of-concept pilot plant, accelerating the pathway to a definitive feasibility study and, ultimately, a construction decision.

Harena points out that, in addition to the PDFA, the US DFC has retained the right to be considered for a further, more substantial, financing or investment role in the project as it advances towards a construction decision.

"The signing of this agreement with the US DFC is a hugely exciting milestone for Harena and a real turning point in the development of the Ampasindava project. It represents the first direct financial commitment from the US government into our project and is a powerful endorsement of Ampasindava's importance as a Western-aligned source of critical magnet rare earths," comments Harena chairperson Ivan Murphy.

"I want to extend a very special thank you to the US DFC and, in particular, to Conor Coleman, the US DFC's chief of staff and head of investments, and his team, for what has been a genuinely enjoyable and constructive working relationship over the past nine months. Their professionalism, pace and partnership throughout this process have been outstanding, and we look forward to continuing to work closely with the US DFC and to expanding our relationship with them as we advance this world-class ionic clay rare earth resource towards production.

"With funding now agreed and drawdown already under way, our team, led by our executive technical director Allan Mulligan, is hard at work on site, and the US DFC has also indicated its interest in playing a much larger role in financing the project as it advances towards a construction decision - a hugely encouraging signal for Harena's future funding pipeline. I look forward to updating shareholders shortly with further news on our progress and development work in Madagascar," he adds.