PERTH (miningweekly.com) – Rare earths developer Ionic Rare Earths is evaluating the development of a stand-alone rare earth separation and refining facility for the downstream processing of mixed rare earth carbonate (MREC) product from its Makuutu rare earths project, in Uganda.
The refining and processing facility will produce refined critical rare earth oxide (CREO) and heavy rare earth oxides (HREO).
Ionic told shareholders on Monday that the majority of current HREO refining capacity was located in China, with minor capacity also located in Vietnam.
The company said that the development of a strategically located, dedicated facility, had the potential to be a substantially earnings accretive asset, which would enhance and strengthen the engagement and participation of potential strategic partners looking to secure access to product from the Makuutu basket.
“Ionic has identified a clear opportunity to provide mine to market CREO and HREO capacity. The company has been assessing options and desktop studies, to maximise returns from Makuutu’s unique and highly valuable basket, especially given the potential for demand to dramatically exceed supply for the HREO in the future. Therefore, the opportunity to build a more integrated mine to market strategy for our CREO and HREO basket becomes far more compelling,” said MD Tim Harrison.
The scale of the separation and refinery facility is likely to be initially set at around 4 000 t/y rare earth oxide (REO) equivalent feed, reflecting an alignment to the peak projected production capacity at Makuutu.
Given the potential for Makuutu to support long-life, low-cost REO production for a period of 27 years, and recent exploration results defining further scale for significant additional growth in resources at Makuutu, the development of a standalone separation and refining asset provides greater long term strategic importance and upside for the company, said Harrison.
“Our timeline to production from Makuutu remains firm, the focus is set on 2024. As we ramp Makuutu up over the rest of the decade to 2030, Ionic also wants to ensure we can build separation and refinery capacity to match that scale of production proposed at Makuutu. To meet those goals, now is the time to start this activity.
“Ionic, through Makuutu, has the potential to produce a dominant 73% CREO/HREO basket, as an intermediate chemical MREC precipitate, free of the radionuclide issues that plague our hard rock rare earth peers, and with a substantially lower capital requirement for downstream refining. Everything points to a fantastic opportunity provided to Ionic.”
“Additionally, the company sees the development of a standalone rare earth separation and refinery facility as being key to providing optionality for the future. With limited HREO refining capacity forecast to be developed outside China in the near term, the development provides direct exposure to maximising value from product with a CREO/HREO dominant basket with greater future demand forecast and diminishing existing supply in years to come.”
The proposed separation and refinery facility will be fully owned by Ionic and will enable the company to increase payability attained from the MREC basket produced at Makuutu to 100% payability for refined individual REO products.
The company at present owns 51% of Makuutu, howeverit will increase its stake to 60% on the completion of the feasibility study before October 2022 and has a pre-emptive right over the remaining 40% stake.