Rare earth plays charting new route to the future
For years, China has wielded rare earths like a sword, threatening export bans, restricting supply and controlling pricing
Lynas has proven there are alternative pathways following the production of dysprosium at its Malaysia plant
Here are some other heavy rare earth ASX players shaking things up
China's decades-long dominance in rare earth production isn't by chance.
It's the culmination of smart investments over many decades and a high tolerance for environmental trade-offs, while other nations have grappled with tighter regulations and higher costs.
Its control over nearly 90% of global rare earth refining and close to 70% of total output, has seen China become the indispensable supplier, leaving other countries vulnerable to price shocks and geopolitical supply disruptions.
The Middle Kingdom has used the resource as a bargaining chip in international relations by flexing its economic muscles and threatening export bans, like its decision earlier this year to suspend all exports of seven kinds of rare earth metals.
These included dysprosium, gadolinium, lutetium, samarium, scandium, terbium and yttrium, all vital inputs to almost everything technological like smart phones, electric vehicles, missiles and wind turbines.
But all of that could soon change.
Last month, $8.21b miner Lynas (ASX:LYC), became the first to break China's grip on heavy rare earths, producing dysprosium at its Malaysia plant and rewriting the global supply map.
It makes Lynas's new production line the world's only commercial producer of separated heavy rare earth products outside of China.
North Stanmore draws US government interest
Dysprosium stands out among other heavy rare earth metals primarily due to its unique magnetic properties, high melting point and ability to absorb neutrons, making it crucial in high-tech applications through its use in permanent magnets and nuclear reactors.
It is often added to neodymium-iron-boron magnetics to improve their performance at high temperatures, making them more efficient and durable.
Its ability to absorb neutrons makes it ideal for use in nuclear reactors, particularly in control rods where it helps regulate the fission reaction.
While Australia's rare earth production numbers pale in comparison to that of China, accounting for only 3.33% of global production in 2024, ASX explorers and developers such as Victory Metals (ASX:VTM) are emerging as competitive players in the rare earth space.
Some projects even contain un-paralleled ratios of magnet rare earth elements such as VTM's North Stanmore clay-hosted heavy rare earth project in WA, which holds a 247.5 million DMT resource at 520ppm total rare earth oxide and 4788t of gallium oxide.
North Stanmore's basket of critical metals has grown to include by-product gallium, key heavy rare earths such as gadolinium, terbium, dysprosium, lutetium,and yttrium, in addition to the light rare earth samarium and by-product scandium.
The project has attracted international government-backed support following a letter of interest from the Export-Import Bank of the US in April for up to US$190m in project financing.
Further funds ($4m) were raised in May with strong backing from VTM's top 20 shareholders to accelerate a PFS after a scoping study in March delivered an impressive case for the project with an NPV exceeding $1212m and IRR of 52%.
'Running our own race'
In response to Lynas achieving first production of dysprosium oxide outside China, VTM CEO Brendan Clark said it was a game changer for ASX listed rare earth companies, particularly those with exposure to heavy rare earth elements.
'It proves that it's technically and commercially viable to extract and process heavy rare earths outside China, which is a big deal and exciting milestone for Lynas,' he said.
'It is Victory Metals' vision to separate high-value critical minerals like dysprosium and terbium from our mixed rare earth carbonate right here in Western Australia.
'We've already achieved the highest confirmed production of heavy rare earth Mixed Rare Earth Carbonate (MREC) from any clay hosted project in the country,' Clark said.
'Our unmatched metallurgical recoveries are a direct result of our unique geological setting underpinned by a deeply weathered, rare earth and critical mineral enriched alkaline intrusion that has been transformed over millions of years through multiple intense weathering cycles.'
Test work carried out on North Stanmore last year demonstrated outstanding recoveries of 93% for high value magnet rare earths, alongside high recoveries of scandium (50%).
More recently, VTM produced gallium in its final mixed rare earth carbonate (MREC) product at 358 g/t gallium oxide, positioning North Stanmore at the forefront of Australian gallium exploration.
'We're running our own race, rare earth companies tend to keep their IP and processing methods tightly held,' he said.
'That said, given the strategic and commercial value of specific heavy rare earths like dysprosium and terbium, we do see an opportunity to downstream further in the future and we're currently exploring those options with strategic partners who bring the technical capability.'
Some other ASX heavy rare earth players
RareX (ASX:REE) owns the Cummins Range project in WA, where high-grade gallium containing values up to 6826g/t has been identified, and is pitching for one of the world's top undeveloped rare earth sites in Kenya.
Last month, REE announced a consortium with Iluka Resources (ASX:ILU) to secure and develop the Mrima Hill project in Kenya as the first step in the building of a non-Chinese rare earths supply chain.
Mrima Hill ranks as one of the top five undeveloped rare earth deposits in the world, while Iluka's under-construction rare earths processing facility at Eneabba in WA, could process RareX's ore from Mrima Hill in a very efficient way.
REE and ILU proposed a joint venture with the National Mining Corporation of Kenya (NAMICO), and have seen a positive response from Kenya's High Commissioner to Australia Dr Wilson Kogo.
Aldoro Resources (ASX:ARN) owns the Kameelburg REE niobium project, 300km north of Windhoek in Namibia.
In May, the company reported the highest grades to date at the site, which confirmed a significant southwest extension and effectively doubling the footprint of the polymetallic discovery.
Significant new intercepts include 293m at 3.67% total rare earth oxide (TREO) equivalent from 3m, comprising 2.1% TREO, 0.21% niobium pentoxide and 448ppm molybdenum.
Over in Brazil, Brazilian Critical Minerals (ASX:BCM) Ema project hosts one of the largest clay rare earth deposits globally, with a mineral resource of 943Mt at 716ppm TREO, including a 341Mt starter zone with high-value magnet REE content.
The project is one of the few fully in-situ recovery rare earth projects outside of South East Asia.
ISR involves dissolving mineral deposits while still underground using chemical solutions, that are then pumped to surface to be processed into mineral products.
This method of mining tends to be kinder on the local environment while also offering lower costs.
A recent, heavily subscribed $4m placement has allowed BCM to accelerate a BFS, complete pilot field trials for in-situ recovery (ISR), progress environmental permitting and strengthen its working capital position to support pre-development activities.
VHM's (ASX:VHM) Goschen project in Victoria has an ore reserve of 210 million tonnes within a massive resource of 892Mt at 3% total heavy minerals and is also rich in rare earths.
This is more than enough to fuel an initial 1.5Mtpa operation using a modular plant that has estimated pre-production capital costs of $160m.
Stage 1 will produce some 4300 tonnes per annum of rare earth mineral concentrate and 69,000tpa of zircon/titania heavy mineral concentrate at operating costs of $77 million per year.
It is expected to fund the stage two expansion to 5Mtpa, which will cost an additional $85-90m and take production up to 9000tpa of rare earths and 134,000tpa of HMC for at least 19 years.
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The Australian
an hour ago
- The Australian
The next ASX mining takeover targets
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Encounter Resources (ASX:ENR) Encounter has the largest land holding in the West Arunta region, which over the past three years has seen significant exploration success from its neighbour WA1 Resources (ASX:WA1), which outlined a large, high grade niobium deposit. Successful drilling by ENR in the last field season culminated in a maiden resource of 19.2Mt at 1.74% Nb2O5 from three separate deposits. This resource is expected to grow as further extensional drilling is done in the current field season. WA1 Resources has a market capitalisation of ~$900m – almost 8x that of ENR at $120m – and whilst it's further ahead in terms of development, we ultimately believe there will only be one key player in this area. Whether that is WA1 Resources or another corporate only time will tell, but logic would suggest there is likely to be only one ferroniobium plant build in this remote area. Guy Le Page – RM Capital Meteoric Resources (ASX:MEI) and/or Viridis Mining and Minerals (ASX:VMM) There is increasing demand for strategic rare earth projects to supply NdPr and Dy/Tb outside of China, driven by national interests, particularly in Western countries seeking supply chain security. Recent reports indicate that Lynas (ASX:LYC) is showing growing interest in Brazil for potential rare earth assets, likely aiming to secure supply and diversify geographically. Both Meteoric and Viridis possess ionic clay rare earth projects in Brazil with substantial resources and well-developed flowsheets. Although current financial metrics for these projects are not favourable at prevailing NdPr prices, the global push for secure supply could elevate their strategic value. Their proximity to the US market may also attract interest for potential takeovers, especially as Lynas advances its US operations with backing and funding from American entities. Lynas has been actively expanding its global supply chain, exemplified by its recent partnership with Menteri Besar in Malaysia. This initiative aims to leverage local processing infrastructure and diversify supply sources, further supporting Lynas' interest in ionic clay REE projects. Such moves suggest Lynas may consider acquiring strategically located assets like Meteoric and Viridis to strengthen its position in the global rare earth industry. Tesoro Gold (ASX:TSO) Tesoro owns 100% of the 1.5 Moz El Zorro Gold Project (Ternera deposit), covering 570km2 of highly prospective geology in Chile's Atacama region, approximately 800km north of Santiago. The project benefits from its strategic location near roads, power lines and an airport, and is situated 190km southwest of Gold Fields' (NYSE: GFI) high-grade open-pit gold and silver mine, Salares Norte. El Zorro is Chile's first discovered intrusive-related gold system, with a proven record of a low discovery cost of US$14/oz to date. A scoping study completed in 2023 estimates a 1.3Moz mineral resource within a US$1800/oz pit shell. The study projects an NPV of US$210 million, based on a 2.4Mtpa throughput over an initial 8-year mine life, with an upfront capital expenditure of US$132m. This scoping study represents a preliminary 'starter' pit, and there is considerable upside potential, as the Ternera deposit remains open in all directions and district-scale exploration targets present additional opportunities for resource growth. Gold Fields owns 17.1% of Tesoro and has been providing ongoing technical support for Tesoro's regional exploration efforts. Astral Resources (ASX:AAR) A noteworthy takeover target in the gold space considering their open pit resource of 1.76Moz located 70km of Kalgoorlie. PFS is due late July. Paul Howard – Canaccord Genuity Given 25% of my coverage list was acquired last financial year and two of my covered stocks in ADT and NWC are currently under the microscope, this is a question I'm all too familiar with! (Ed's note: For context, Howard normally has 16-20 stocks under coverage) The mining sector typically expands and contracts over time in terms of number of participants. We had record IPOs post-Covid but now we're in a period of consolidation; the sector is getting smaller as the number of M&A deals increase. Although counter cyclical M&A deals make most sense, I see most upcoming M&A happening in the precious metals space, signalling that we are still far from the top. On the counter cyclical view, I wouldn't write off something happening in the nickel space with the likes of Centaurus Metals (ASX:CTM) (large nickel sulphide project in Brazil, Jaguar) and see opportunities for companies with copper offerings given the notion of decarbonisation and energy transition (Firefly, Cygnus Metals (ASX:CY5) or even Caravel Minerals (ASX:CVV)). But it's in precious metals where I see the most likely deals. Bellevue Gold (ASX:BGL) could go to an established producer in the near term; Antipa Minerals (ASX:AZY) could bolt on to Greatland Gold, continuing its Paterson Province consolidation moves; and the very large Rogozna project, owned by Strickland Metals (ASX:STK) in Serbia surely appeals to a major given the scale that could grow to 10Moz AuEq before long (Ed: Zijin is a large player in the geographical region). In the silver space, Andean Silver's (ASX:ASL) high grade and existing infrastructure offers appeal against a backdrop of global silver M&A deals (PASS-NYSE and MAG-TSX; DPM-TSX and ADT-ASX; AG-TSX and GATO-TSX). At the smaller end of town, companies like Astral Resources, Caprice Resources (ASX:CRS) and Great Boulder Resources (ASX:GBR) offer potentially accretive ounces to their neighbours, in our view. In West Africa, where many a M&A deal has taken place in recent years, we flag Predictive Discovery (ASX:PDI) and Turaco Gold (ASX:TCG) as having severe M&A appeal and wouldn't write off the prospect of seeing more strategic investments in smaller explorers such as Many Peaks Minerals (ASX:MPK) or Asara Resources (ASX:AS1). In fact, the whole global junior and emerging space is probably open to further strategic investments rather than pure takeover. We've seen Lundin, Montage and Zijin take this approach recently and to good effect. Hedley Widdup – Lion Selection Group Antipa Minerals (ASX:AZY) Given the amount of airtime this one has got I risk being Captain Obvious. The summary is that Greatland have done a wonderful job of outlining their plan to rejuvenate Telfer, which will benefit immensely from additional ore sources. Telfer is a big process plant, so anything that can be brought in probably needs to deliver volume as well. Antipa's Minyari contains a lot of its inventory in a single footprint, so offers up what appears to be both volume and compatibility. With Greatland set to list on ASX and suddenly become a big new domestically listed and focused gold miner, at a capitalisation that will likely see it gain index inclusion rapidly, you would expect them to have strong paper. I have to declare, Lion is a shareholder in Antipa. Bellevue Gold (ASX:BGL) This is also a name that has had chins wagging all over the place, and I think surrounds a notion that the market had a level of tolerance for commissioning issues, but Bellevue has taken too long and it's beginning to look like the ability to deliver large tonnage from a narrow vein underground at high grade is more challenging than hoped. The sport here appears to be in who the buyer might be, almost as if the chattering classes have decided a change of control is assured. Catalyst Metals (ASX:CYL) has not been concealing growth interest, although hasn't engaged in company-scale growth M&A since two deals to reunite the Plutonic field – their ambition would appear to be commensurate with a Bellevue sized target. Regis Resources (ASX:RRL) has been fingered for acquisitive interest and is probably seen as one of the most motivated project acquirers in the gold space aside of strategic neighbour consolidation. And I have wondered for a while if it is foolish to rule out Develop Global (ASX:DVP) – who spectacularly ruled out gold on the sidelines of Diggers and Dealers several years back ('gold isn't green, I'm sorry but its not') and is hitting its straps at its own project in NSW. My suspicion arises from (former Northern Star boss and now Develop MD) Bill Beament's personal history of buying projects he had previously operated at as a contractor. What would surprise us? At the moment the most deal speculation I read is around gold miners who have been piling in cash, buying up undeveloped growth options cheaply or bigger sized strategic deals like BHP for Anglo, Rio for Glencore etc. Who else is well funded, and what could they be looking at? With the competition between Trump and China leading to a renewed focus on rare earths and antimony, I think M&A interest may be relevant where deposits have either grade or scale or both, where they are located in safe jurisdictions and offtake is available. And to be clear, these are a few examples of a larger population, that might suddenly begin to look important as geopolitics changes. In rare earths, Critica (ASX:CRI) – resource stage which might make it a bit early for strategic corporates but it's very, very big, high grade and strongly located in WA's Gascoyne region (Lion owns some Critica). In antimony, Warriedar Resources (ASX:WA8) – very large antimony resource has emerged rapidly and largely from un-assayed historic holes that were drilled for gold and Southern Cross Gold (ASX:SX2) – it would be rare, but not unprecedented for a pre-resource situation to become a target. I am sure the high grades of antimony have been recognised. At Stockhead, we tell it like it is. While Astral Resources, Antipa Minerals, Caprice Resources and New World Resources are Stockhead advertisers, they did not sponsor this article. The views, information, or opinions expressed in this article are solely those of the fund managers, brokers8 and analysts and do not represent the views of Stockhead. Stockhead does not provide, endorse or otherwise assume responsibility for any financial advice contained in this article.
ABC News
an hour ago
- ABC News
Is Iran set to leave the Nuclear Non-Proliferation Treaty?
As the bombs keep landing and Israel continues its devastating attacks on Iran's nuclear program, it's easy to forget Iran remains a signatory of the Nuclear Non-Proliferation Treaty, or NPT. Up until Israel's strikes Iran was still submitting to inspections by the UN's International Atomic Energy Agency (IAEA). The nuclear watchdog has continued to gather data on Iran's nuclear program, but Tehran has increasingly placed severe restrictions on access. But with the devastating damage to its nuclear installations, some analysts believe this confrontation could drive Iran out of the treaty — and actually provide more impetus to develop nuclear weapons. "Iran's reaction would be, 'What was the point of adhering to the Non-Proliferation Treaty?'" Middle East historian Ibrahim al-Marashi told 7.30. "'We might as well, even with all the damage done, we should get a nuclear weapon. As our ultimate guarantor of survival.'" In an interview with 730 this week, Iran's ambassador to Australia Ahmad Sadeghi denied his country is developing a nuclear weapon. "The nuclear program of Iran is for the peaceful measures," Mr. Sadeghi said. The NPT came into force in 1970 and currently more than 190 countries are signatories. Its aim is to stop the spread of nuclear weapons. Inspections in Iran have become more difficult since the US walked away from an agreement with the country in 2018. That deal saw the US and other countries loosen economic sanctions in return for Iran agreeing not to develop a nuclear weapon. "The deal was working until Donald Trump was elected in 2016," said Barbara Slavin from not-for-profit think tank the Stimson Centre. She's been analysing American-Iranian relations for four decades. "[Trump] began criticising the agreement and he finally left it in 2018, while Iran was still in full compliance with that deal. Now following that, Iran gradually began to ramp up the programme again, to the point where it was very, very advanced." The day before Israel launched its first attacks, the IAEA declared Iran was in breach of its NPT obligations and said it could not assure that Iran's nuclear programme was only peaceful. "Just before the Israelis attacked, the IAEA board of governors actually issued a censure resolution against the Iranian government for its lack of cooperation," Ms Slavin said. "I think the Israelis thought that strengthened their case to attack Iran." Israel has long argued that a nuclear-armed Iran would threaten its existence. But Ms Slavin and many analysts point out there's an important caveat to that argument: Although it is not officially acknowledged, Israel is believed to possess multiple nuclear weapons. "So if Israel really felt that its existence was at stake, it could use nuclear weapons against Iran or any other adversary. That's why Israel developed nuclear weapons in the 1960s," Ms Slavin said. Mr al-Marashi says that contradiction — that Iran is part of the NPT and Israel isn't — is hard to ignore. "A lot of commentators or just regular people would say that there's a double standard: that Iran [belongs to] the NPT, but that Israel practises a policy of nuclear opacity," Mr al-Marashi said. "Not being a member of the NPT … [Israel] deliberately tries to be vague about its nuclear arsenal to keep people guessing." While not confirming it has nuclear weapons, Israel argues a nuclear capable Iran poses an existential threat because its leaders have repeatedly said they want to destroy Israel. Watch 7.30, Mondays to Thursdays 7:30pm on ABC iview and ABC TV Do you know more about this story? Get in touch with 7.30 here.
