Lindian Resources Ltd (ASX:LIN, OTC:LINIF) has moved to full ownership of the SARECO mixed rare earths carbonate (MREC) processing facility in Kazakhstan, giving the company complete operational and marketing control as it builds an integrated rare earths supply chain around its Kangankunde project in Malawi.
The company will acquire the remaining 49% interest in SARECO after initially planning to hold 51%, with the decision following legal, tax, technical and environmental due diligence. The definitive sale and purchase agreement has now been executed.
SARECO is an established hydrometallurgical facility at Stepnogorsk with cracking, leaching and precipitation circuits already installed, as well as utilities, reagent-handling infrastructure and rail access.
Lindian is targeting first processing at SARECO in the fourth quarter of 2026, in line with planned first production from Kangankunde.
Site layout of the SARECO MREC Facility, highlighting key installed infrastructure including the main processing plant, sulphuric acid storage and neutralisation facilities, MREC bagging and dispatch area, and dedicated rail spur for reagent delivery, Concentrate receival and MREC export.
Full control of downstream processing
Full ownership gives Lindian exposure to 100% of SARECO production and margins, exclusive marketing rights over MREC produced at the facility and control over future investment and development decisions.
The acquisition carries an asset purchase price of up to US$20 million in cash.
RA Group will also receive up to US$22 million in Lindian equity, comprising US$15 million in ordinary shares and US$7 million in performance rights at a deemed issue price of A$0.775. The performance rights are linked to milestones including 1 and 2 years of commercial production at SARECO.
The transaction includes 2 additional warehouses covering about 15,500 square metres, together with further buildings and land that Lindian says could support future downstream processing expansion.
Existing processing infrastructure within the SARECO MREC Facility.
SARECO was originally developed by Kazakhstan's Kazatomprom and Sumitomo Corporation. Lindian said establishing a comparable new MREC facility would involve capital costs of more than A$500 million as well as multi-year permitting, construction and commissioning timelines.
Kangankunde feedstock underpins project
Lindian ultimately expects around 12,500 tonnes per annum of Stage 1 monazite concentrate from Kangankunde to feed SARECO.
Independent ANSTO test work recorded 98% neodymium-praseodymium extraction during sulphuric acid bake and water leaching, with overall NdPr recovery of about 96% from concentrate through to final MREC.
The final MREC was also certified as exempt from radioactive transport and handling requirements under applicable IAEA standards.
Lindian is examining alternative Kazakhstan-based feedstock that could enable processing at SARECO before Kangankunde production has fully ramped up.
Following a recent A$100 million institutional capital raising, Lindian said it is fully funded to complete Kangankunde Stage 1 through to first cash flow and advance SARECO into production.
Next steps
The company's immediate focus is completing the SARECO acquisition and preparing the facility for first processing from Q4 2026.
At Kangankunde, Stage 1 construction is well advanced with first production also targeted for Q4 2026, while Lindian continues to assess local Kazakhstan feedstock and longer-term downstream expansion opportunities at Stepnogorsk.