TIDMRBW
RNS Number : 3397L
Rainbow Rare Earths Limited
05 September 2023
5 September 2023
Rainbow Rare Earths Limited
("Rainbow" or "the Company")
LSE: RBW
Rainbow's Process Flow Sheet successfully produces mixed rare
earth sulphate
at the Phalaborwa front-end pilot plant in South Africa
-- First production of mixed rare earth sulphate achieved at Phalaborwa front-end pilot plant
-- Validates Rainbow's successful development of a process flow
sheet to recover rare earths from phosphogypsum
-- Mixed rare earth sulphate is of expected purity and grade and
includes all four of the critical 'magnet' rare earths, including
Neodymium and Praseodymium (together "NdPr") and the heavies
Dysprosium ("Dy") and Terbium ("Tb"); it is a commercial product
that could be a standalone revenue stream for Rainbow
-- Front-end pilot plant reagent consumption and overall
recoveries of ca. 65% are in line with the expectations of the
Preliminary Economic Assessment
-- Mixed rare earth sulphate will be used as feed for the
back-end pilot plant built at K-Tech facilities in Florida for
final processing into separated rare earth oxides
-- Front-end pilot plant will run for an additional quarter to
further optimise recoveries and cost-base
NEWS RELEASE
Rainbow Rare Earths is pleased to announce that the front end of
the Phalaborwa pilot plant in South Africa has successfully
produced its first batch of mixed rare earth sulphate, totalling
ca. 3 kg.
This major milestone has been achieved on time and within the
expectations of the Preliminary Economic Assessment ("PEA") in
terms of reagent consumption/costs and recoveries .
The front-end pilot plant has produced a 58% mixed rare earth
sulphate product with a ca. 65% overall recovery in line with the
PEA. The final sulphate includes all four of the most economically
important rare earth elements (NdPr, Dy and Tb) in economic
quantities in line with the Phalaborwa mineral resource. These are
known as the "magnet rare earths" as they are used to make the
permanent magnets essential to decarbonisation via their use in
electric vehicles and wind turbines.
Photos of the mixed rare earth sulphate can be viewed at
https://www.rainbowrareearths.com/projects/gallery/
The mixed rare earth sulphate produced by the Phalaborwa pilot
plant is a commercial product that could be a standalone revenue
stream for Rainbow, with an estimated ca. 60% payability of the
global price for the contained separated rare earth oxides.
The Phalaborwa front-end pilot plant is situated at the
Johannesburg facilities of the Council for Mineral Technology
("Mintek"), a global leader in mineral processing, extractive
metallurgy, and related fields, and is running for ca. four months
treating ca. 35t of phosphogypsum feed from the Phalaborwa project
stacks to produce ca. 350kg of mixed rare earth sulphate. During
this period, further optimisation of recoveries and reagent
consumptions/costs are expected to be achieved.
The first batch of mixed rare earth sulphate will be shipped to
the back-end pilot plant, situated at K-Technologies, Inc.
("K-Tech") in Lakeland, Florida, USA, for separation into rare
earth oxides, with the first batch of separated rare earth oxides
expected early in Q4 2023.
As previously announced, Rainbow is currently exploring the
option of establishing its back-end rare earth oxide separation
process in the USA and has identified a potential site for a
commercial scale plant. This would establish the Company as one of
the only producers of the four permanent magnet separated rare
earth oxides in the USA.
Rainbow, through its proprietary flow sheet, expects to be able
to produce separated rare earth oxide products at >99.5% purity
that can be sold directly to metal and alloy manufacturing capacity
(which in turn feed permanent magnet manufacturing plants)
currently being developed in the USA and aligned countries,
highlighting Rainbow's unique position within the magnet rare earth
supply chain.
George Bennett, CEO, commented: "The production of mixed rare
earth sulphate from the front-end pilot plant is a major milestone
for the Phalaborwa project and validates Rainbow's strategy to
recover rare earth elements from phosphogypsum stacks. This
achievement not only de-risks Phalaborwa, it also opens up exciting
opportunities for the Company to apply the proprietary technology
to other similar phosphogypsum resources globally, including at the
Mosaic Uberaba stack in Brazil.
We look forward to our final de-risking step, producing
separated rare earth oxides in early Q4 2023 at the back-end pilot
plant situated at K-Tech's facilities in the USA. This will enable
Rainbow to capture the full uplift in value by taking our product
all the way through to separated rare earth oxides, with the
overall positive impact on the Company's future revenue streams and
profitability.
Given the importance of Phalaborwa, we are delighted to have
recently increased our stake in the project to 85% and have a clear
path to owning 100% in the near-term, as we believe this will be
highly value accretive to shareholders over time.
The USA and aligned countries are looking to establish an
independent and ethical supply chain of the rare earth elements
that are essential to decarbonisation, defence and other strategic
products vital to the 21(st) century global economy, and we are
expecting Rainbow to be able to play a significant role in meeting
that objective."
For further information, please contact:
Rainbow Rare Earths George Bennett
Ltd Company Pete Gardner +27 82 652 8526
Cathy Malins +44 7876 796 629
(IR) cathym@rainbowrareearths.com
Matthew Armitt
Berenberg Broker Jennifer Lee +44 (0) 20 3207 7800
Tavistock Communications PR/IR Charles Vivian +44 (0) 20 7920 3150
Tara Vivian-Neal rainbowrareearths@tavistock.co.uk
Notes to Editors:
Rainbow Rare Earths aims to be a forerunner in the establishment
of an independent and ethical supply chain of the rare earth
elements that are driving the green energy transition. It is doing
this successfully via the identification and development of
secondary rare earth deposits that can be brought into production
quicker and at a lower cost than traditional hard rock mining
projects, with a focus on the permanent magnet rare earth elements
neodymium and praseodymium, dysprosium and terbium.
The Company is focused on the development of the Phalaborwa Rare
Earths Project in South Africa and the earlier stage Uberaba
Project in Brazil. Both projects entail the recovery of rare earths
from phosphogypsum stacks that occur as the by-product of
phosphoric acid production, with the original source rock for both
deposits being a hardrock carbonatite. Rainbow will use a
proprietary separation technique developed by and in conjunction
with its partner K-Technologies, Inc., which simplifies the process
of producing separated rare earth oxides (versus traditional
solvent extraction), leading to cost benefits, as well as being
more environmentally friendly.
The Phalaborwa Preliminary Economic Assessment has confirmed
strong base line economics for the project, which has a base case
NPV(10) of US$627 million[1], an average EBITDA operating margin of
75% and a payback period of < two years. Pilot plant operations
commenced in 2023, with the project expected to reach commercial
production in 2026, just five years after work began on the project
by Rainbow.
More information on the company is available at
www.rainbowrareearths.com .
[1] Net present value using a 10% forward discount rate
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END
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