The Elements of Innovation Discovered
The Elements of Innovation Discovered
Metal Tech News - March 6, 2024
USA Rare Earth is securing supplies of REEs for its Oklahoma magnet plant as it advances permitting and development of its Round Top critical minerals mine in Texas.
In a move that will begin to establish a circular and domestic supply chain for the powerful magnets used in electric vehicle motors, USA Rare Earth LLC has signed a deal to buy ultra-pure rare earth elements (REE) produced from ReElement Technologies Corp.'s state-of-the-art rare earths and battery metals refining facility in Indiana.
"We are thrilled to be working with an industry leader like ReElement to create a secure U.S.-based supply of rare earth magnets in a more sustainable and efficient way," said USA Rare Earth CEO Tom Schneberger.
Utilizing a patented technology developed in partnership with Purdue University, ReElement recovers critical minerals from recycled permanent magnets and lithium-ion batteries, as well as processing ore and coal waste streams, to create a low-cost, sustainable, and circular source of rare earths and battery materials.
"We look forward to being the key to completing the domestic supply chain for production of these products, by enabling virgin ores and end-of-life products to both be able to be recycled and refined all the way back to rare earth permanent magnets and lithium-ion batteries," said ReElement Technologies CEO Mark Jensen.
The rare earths to be produced at ReElement's current production facility and the Marion Advanced Technology Campus being built in Indiana provides USA Rare Earth with an ideal feedstock for the rare earth magnet manufacturing facility it is developing in Stillwater, Oklahoma.
Rare earth magnets like those to be produced at USA Rare Earth's plant are used in speakers, computer hard drives, MRI machines, cordless power tools, and even the motors responsible for the vibrate feature in smartphones.
However, it is ultimately EV motors and wind turbine generators that are driving the demand growth for these permanent magnets and the need for the Oklahoma factory.
The Oklahoma factory is one link in a complete rare earths mine-to-magnets supply chain that USA Rare Earths is endeavoring to establish in the U.S.
The first link of this chain is the Round Top rare earths and critical minerals mine project in Texas.
Being advanced toward production under a joint venture between USA Rare Earth (80%) and Texas Mineral Resources Corp. (20%), the Round Top project southeast of El Paso hosts an enormous deposit of rare earths, lithium, and six other minerals critical to the U.S.
A preliminary economic assessment for Round Top outlines plans for a mine that would produce 2,212 metric tons of rare earths per year, plus seven other critical metals – beryllium, gallium, hafnium, lithium, magnesium, manganese, and zirconium.
The suite of rare earth elements produced at Round Top will include six REEs used in magnets – neodymium, praseodymium, dysprosium, terbium, gadolinium, and samarium.
The future Texas mine is also expected to produce roughly 10,000 metric tons of lithium each year, which further increases Round Top's potential as a domestic supplier of the metals needed for a nation transitioning to EVs charged with low-carbon electricity.
USA Rare Earth raised US$50 million in 2021 to complete a prefeasibility study that will further refine the economic and design parameters outlined in the PEA; finish testing at the company's pilot rare earths separation plant in Colorado; and build a demonstration-scale plant at Round Top.
Permitting and developing a mine in the U.S., however, is a much slower endeavor than building a magnet plant. To provide a domestic supply of rare earth magnets as quickly as possible, USA Rare Earth is securing alternate supplies of feedstock for its Oklahoma factory.
With its sights set on producing magnets at its Oklahoma factory by the end of the year, USA Rare Earth has already entered into a deal to purchase rare earths mined at Australian Strategic Materials Ltd.'s Dubbo project in Australia and processed in South Korea.
"ASM provides us with predictable access to a non-Chinese supply of rare earth metals, which allows us to ramp-up our initial production and accelerate our goal of generating revenue, while we continue to construct our own mine," said Schneberger.
Now, the company has secured a high-quality and sustainable source of rare earths in the U.S.
Under an offtake agreement announced on March 4, USA Rare Earth will purchase high-purity rare earth oxides from ReElement Technologies' processing and purification facility in Indiana.
"In conjunction with our other supply agreements, ReElement will enable us to ramp up production quicker and in a more environmentally friendly manner while we continue to build out our own mine in Texas," said Schneberger.
Under the agreement, USA Rare Earth will begin purchasing rare earth oxides from ReElement in 2025. By 2028, more than 900 metric tons of high-purity oxides will be shipped to the Oklahoma magnet plant each year, which would provide ReElement somewhere around $65 million in annual revenue.
"As the leading domestic producer of ultra-high purity rare earth oxides, we couldn't be more excited to further our relationship with USA Rare Earth and their amazing team for the fully domestic production of permanent magnets from rare earth elements," said Jensen. "As we look to inaugurate and expand our Marion Advanced Technology Campus and facility, signing offtakes with manufacturers of permanent magnets and battery materials enables us to rapidly progress the business model at ReElement and prepare for future growth and profitability."
It also positions both ReElement and USA Rare Earth as important players in a domestic supply chain for the minerals and magnets critical to America's energy transition.
With more than 16 years of covering mining, Shane is renowned for his insights and and in-depth analysis of mining, mineral exploration and technology metals.
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