Project Updates

Project Update May 2023

  Friday 26th May, 2023


Downstream Processing in Australia

The Glenaladale Minerals Sands Resource, which hosts the Fingerboards Critical Minerals Project (Fingerboards), is globally attractive in terms of both its scale and concentration of rare earths and zircon. This includes in-situ mineral content of approximately 900,000 tonnes of TREO (total rare earth oxides; in monazite and xenotime) and 10 million tonnes of zircon.

Fingerboards is set to play a key role in delivering the key ‘magnet feed’ rare earth elements (REEs) that are critical in delivering global decarbonisation through the transition to renewable energy. Fingerboards will produce monazite and xenotime containing neodymium (Nd), praseodymium (Pr), terbium (Tb) and dysprosium (Dy). These high-value REEs are used in permanent magnets, generators and motors for electric vehicles and wind turbines. They are also utilised in a wide range of other modern technologies, including the robotics, aerospace, and defence industries.

Fingerboards will utilise world-leading and environmentally friendly mineral extraction approaches. Its development and operation will be undertaken in a way that fully respects the land, First Nations cultural heritage, and the local community.

After evaluating a range of potential downstream processing options, we recently advised that Gippsland Critical Minerals (GCM) had entered into a collaboration agreement with the developer of a mineral separation facility in the Northern Territory. This was undertaken with a view to both increasing final product values and further aligning the Fingerboards Project with the Australian Government’s Critical Minerals Policy.

To that end, I am pleased to inform you that our collaboration agreement is with Minhub Operations Pty Ltd (MOPL), which has entered into an agreement to be acquired by ASX-listed FYI Resources (ASX:FYI).

MOPL and Arafura Rare Earths Limited (Arafura) recently signed a non-binding Co-operation Agreement to investigate the joint development of the Minhub Project, a Mineral Sands Processing (MSP) facility in Australia’s Northern Territory.

The GCM and MOPL Cooperation Agreement envisages GCM shipping its HMC output to the MSP for processing and sale of the separated, higher-value rare earths, zircon, and titanium minerals product streams.
MOPL proposes to make a Financial Investment Decision on the project subject to a positive feasibility study in early 2024. Arafura’s decision to co-fund the project remains subject to:

  • Arafura’s continuing pro-rata funding toward the feasibility study; and
  • A development decision being made by Arafura through which Arafura will notify MOPL it wishes to pursue development of the Minhub Project jointly with MOPL.

As background, Arafura is set to be a major supplier of NdPr oxide to the electric vehicle (EV) and wind turbine sectors. It has binding supply agreements in place with Korean EV manufacturers Hyundai and Kia and offshore turbine manufacturer Siemens Gamesa Renewable Energy, and an MoU with General Electric (GE).
Arafura has received significant Australian and international governmental backing with non-binding letters of support for A$350 million of debt from the Northern Australia Infrastructure Facility and Export Finance Australia, and a non-binding letter of in-principle support for a loan guarantee of up to US$600 million from German Export Credit Agency Euler Hermes (subject to final offtake volumes and structures with German companies).

Gavin Lockyer, Managing Director of Arafura Rare Earths Limited commented, “We see this opportunity for collaboration as a natural fit with the Nolans Project. Arafura is excited by the opportunity to explore a collaboration with Minhub and GCM to deliver critical ‘magnet feed’ heavy rare earths needed by global magnet makers.”

ASX listed FYI Resources, is a critical minerals development company with an advanced High Purity Alumina (HPA) development project along with its investment in MOPL.

Roland Hill, Managing Director of FYI Resources Ltd made the following statement, “GCM’s Fingerboards Critical Minerals Project is one of the world’s most significant resources of zircon and critical heavy rare earths. Our investment in Minhub aims to create a material downstream sovereign processing facility for critical rare earths for Australia’s emerging mineral sands projects such as Fingerboards. The Minhub Project will facilitate GCM’s aims in delivering the minerals critical to global decarbonisation whilst GCM will be a key source of long-term feedstock for Minhub’s rare earth processing operations”.

This is an exciting development for Gippsland Critical Minerals. We look forward to progressing Fingerboards along the approval’s pathway to development and production, particularly now that there is a demonstrated higher-value, domestic mine-to-market outcome for the Fingerboards HMC product.

Jozsef Patarica
Chief Executive Officer