ASX-listed heavy rare earths developer Northern Minerals, has secured a $4.3 million refund from the ATO as part of the Government’s research and development tax offset scheme for work completed at its Browns Range Pilot plant project in the Kimberley. The refund comes off the back of trial beneficiation and hydrometallurgical plant testing designed to advance the company’s knowledge around processing of its heavy rare earths.
Northern Minerals built its $70m Browns Range heavy rare earths pilot facility to design a processing flow sheet that would ultimately be robust enough for the company to build a much larger-scale plant.
Only 5 operating heavy rare earths processing facilities exist worldwide - and they are all in China. Northern is attempting to break the Chinese monopoly on heavy rare earths such as dysprosium and terbium with its Brown Range project.
Both rare earths are used in the manufacturing of industrial that are in turn used in electric engines – both automotive and commercial.
Dysprosium prices have surged by over 50 per cent since last November and terbium oxide prices have nearly doubled over the same timeframe. Both of the heavy rare earths are part of the rapidly developing electric vehicle story.
Northern Minerals’ 2015 feasibility study outlined a project that, at full scale, would cost A$329 million to build and generate an impressive $176 million a year in free cash flows over more than 11 years of initial operating life.
The company has however been busy in the field drilling out further resources with a view to increasing that mine life and therefore the project net present value.
The company expects to lodge a bankable feasibility study in the first half of 2022 with a decision on the immediate future of the venture to be made by the board shortly thereafter.
Even during pilot development Northern Minerals has been the only serious producer of dysprosium and terbium outside China over the past two years.
The company commissioned a Steinert ore sorter earlier in the year to boost the head grade of its plant feed. Test work has indicated that ore sorting could potentially double the mill feed grade according to the company. The ore sorter concentrates ore in the beneficiation circuit based on x-ray transmission.
Northern Minerals looks to be entering the rare earths market at an opportune time with dysprosium trading at US$460 per kg and terbium at US$1729 per kg up from US$288 per kg and US$1,004 per kg respectively at the same time last year. The company will no doubt attract the attention of western markets if it can build a major heavy rare earths mine – most of whom are looking for any excuse to stop dealing with China.
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