Canada Rare Earth Corp (TSX-V:LL) revealed that it forged an agreement in principle on April 24, 2022, to purchase an existing rare earth refinery situated in South East Asia.
In a statement, Canada Rare Earth COO Peter Shearing said the refinery is based on technology and processes already deployed and in production at a dozen other rare earth processing plants and can produce approximately 3,000 metric tonnes, or 3 million kilograms (kg) of the complete spectrum of rare earth oxides.
“The capability to produce high-profile neodymium (Nd), praseodymium (Pr), dysprosium (Dy) and terbium (Tb) oxides is of critical importance to the rapidly developing and growing electrification and electric vehicle (EV) market sectors. These valuable elements are trading at strong price levels and demand is not fully satisfied by current output levels of existing facilities,” noted Shearing. “For example, Nd and Pr are currently selling for approximately US$135 per kg and Dy and Tb for US$397 and US$2,200 per kg respectively, according to Baiinfo.”
Meanwhile, Canada Rare Earth CEO Tracy A Moore said the company is “working closely” with the owners and the negotiations are “going very smoothly” and progressing rapidly towards “a definitive agreement” to seal the acquisition.
“Price will contemplate two permitting scenarios – operating permit received and pending. It is anticipated the definitive agreement will contain detailed commercial and proprietary terms customary for such documents,” added Moore. “We have been involved with this refinery for a number of years and believe this is the best moment to move forward with the acquisition.”
The Vancouver, British Columbia-based company, which is developing a vertically integrated business within the global rare earth industry, noted that the acquisition is subject to finalizing the definitive agreement and “arranging financing”.
“With Canada Rare Earth’s steadily growing supply of rare earth concentrates, we are confident in our ability to supply the needed concentrate feedstock to the refinery for its current capacity and to support expansion plans in future years,” pointed out Shearing. “We are also working towards expanding our sources, especially in-country, to supply the refinery and address the needs of our existing customer base.”
Canada Rare Earth’s focus is to generate revenues and positive cash flow from a variety of profit centres in the rare earth production and sales chain by sourcing, adding value and selling rare earths in all stages and forms. The firm is in the process of establishing its own mining, concentrating and refinery capabilities.
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