Northern Minerals is raising $15 million in funding to develop its Browns Range heavy rare earth pilot plant in Western Australia and to repay research and development costs.
The Browns Range pilot plant project in the East Kimberley region is the first rare earth-focused plant to operate outside of China.
The plant, which is focused on dysprosium and terbium, achieved a milestone last October with the production of its first carbonate.
Browns Range has a JORC 2012 total mineral resource of 9.07 million tonnes at 0.63 per cent total rare earth oxides (TREO) for 57.3 million kilograms of contained TREO.
The $15 million will be split evenly between a share placement and a note subscription. The $7.5 million share placement is for the sale of 150 million shares at a price of five cents a share, while the $7.5 million note subscription will be paid in two tranches at a face value of $1 a note. Both the share placement and subscription are to be issued to investors located in China.
The first tranche of $2.5 million is due on or before April 30 with the remaining $5 million due on or before June 21, subject to shareholder approval.
Northern Minerals has previously expressed its growing confidence around the heavy rare earth metals sector, citing Wesfarmers’ recent $1.5 billion bid for rival producer Lynas Corporation as a particularly prominent example.
Rare earth elements (REEs) such as neodymium and dysprosium have seen increased demand in recent years from battery manufacturers due to ramping global electric vehicle production.
“With interest in the rare earth sector increasing following the recent unsolicited takeover approach to Lynas Corporation and the growing trajectory of electric vehicles becoming a federal election issue, we see the coming 12-18 months as a period to demonstrate our capabilities and reliability,” Northern Minerals managing director and chief executive officer George Bauk said.