Geomega Resources, (TSX:V.GMA) a rare earth clean technologies developer, and USA Rare Earth, the funding and development partner of the Round Top Heavy Rare Earth project in Texas, announced Thursday that they have entered into a Letter of Intent (LOI) to recycle rare earth-containing production waste from USA Rare Earth’s future production of sintered neodymium iron boron permanent magnets.
The $14 billion-a-year rare earth magnet market is more than 60% controlled by China which, under Made in China 2025, is increasingly using rare earth magnets in finished and semi-finished products, as opposed to exporting the magnets, and industry sources estimate the rare earth magnet market will nearly double by 2027.
Coronavirus-induced shutdowns to manufacturing plants in China that could potentially cut off US rare earths imports shone a spotlight on the fact the nation is reliant on China for its rare earths needs, and on the need to establish robust domestic supply chains.
The $14 billion-a-year rare earth magnet market is more than 60% controlled by China and industry sources estimate it will nearly double by 2027
In January, the US and Canada finalized a Joint Action Plan on Critical Minerals Cooperation, aimed to advance the countries’ mutual interest in securing supply chains for the critical minerals needed for manufacturing sectors, communication technology, aerospace and defence, and clean technology.
The Geomega-USA Rare Earth LOI follows on a collaborative agreement between USA Rare Earth and Australia’s Arafura Resources, involving processing work at USA Rare Earth’s Colorado pilot plant, which opened in June.
The Round Top REE and critical minerals deposit is located on state property owned by the Texas General Land Office (GLO), and the Texas government has recommended it as a high priority infrastructure project soliciting federal support and approval. It reportedly contains lithium, uranium, thorium, beryllium, zirconium, and aluminium, with estimated resources of 1.1mt.
As part of its mine-to-magnets strategy, earlier this year USA Rare Earth purchased the sintered neo magnet manufacturing equipment formerly owned and operated in North Carolina by Hitachi Metals America.
USA Rare Earth said it is reviewing options for the location of the plant, which will become the first neo magnet manufacturing plant in North America since the Hitachi facility ceased operations in 2015.
Other domestic sources of neo magnets either import magnets for assembly in the US or import sintered neo magnet blocks that are machined and assembled in the US.
The plant was designed to produce in excess of 2,000 tonnes of sintered neo magnets per year, or approximately 17% of current U.S. demand for neo magnets.
Material from USA Rare Earth’s facility and material from machining of other blocks will be the feed for Geomega’s recycling plant located in St-Bruno, Quebec which, after processing, could become one of the rare earth oxide feed required for USA Rare Earth’s magnet plant, the company said.
“Geomega’s process to recycle waste and bring it back into our magnet feedstock reconfirms our readiness to innovate at every point in our mine-to-magnets strategy,” said Pini Althaus, CEO of USA Rare Earth in a media statement. “It is also part of our strategy accelerate revenues from our U.S.-based neo magnet production ahead of mine production from the Round Top project.”
“We see this collaboration with Geomega as an example of the kind of cooperation called for by the US and Canadian governments, in the area of critical minerals and Rare Earths in particular,” Althaus said.