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Rainbow Rare Earths looks to build production as Burundi operation hits stride

Some 575 tonnes of rare earth concentrate had been exported by end June

Burundi
A second mine is due to open at Murambi

Rainbow Rare Earths PLC (LON:RBW) expects production from the Gakara licence in Burundi to rise towards 400 tonnes per month by the end of 2018.

Production of rare earth concentrate came on stream late in 2017 and in the final quarter of the year to June was running at 100tpm.

READ: Rainbow Rare Earths signs cooperation agreement to fund downstream definitive feasibility study

In total, and since production started, 575 tonnes of rare earth concentrate had been exported by end of June.

Gakara is characterised by exceptionally high grades and is the only rare-earths mine in Africa and just the second outside of China.

Revenues in the year to June were US$992,000, stemming just from the time that the operation at Gakara was declared commercial.

Losses for the year were US$2.51mln (US$1.4mln).

WATCH: Rainbow looking ahead to increased production

Rainbow is looking to open up a second mining operation at Murambi this year while a co-operation agreement to fund a feasibility study for a downstream facility to further boost production was signed recently with TechMet.

Exploration, meanwhile, is underway at the Kiyenzi area of Gakara, with code-compliant resource targeted for the second quarter of 2018.

Rare earth prices have remained relatively stable in 2018, but Rainbow believes demand will only grow long-term alongside the global use of electric vehicles, smartphones, wind turbines and generators, and electronics generally.

Shares fell 6.1% to 10.8p on Wednesday afternoon.

-- Updates for share price and video link --

Quick facts: Rainbow Rare Earths Limited

Price: 2.65 GBX

LSE:RBW
Market: LSE
Market Cap: £11.18 m
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