US agency takes steps to protect Nevada mountains from energy development
The lands would remain open to mining claims, the Interior Department said.
American Rare Earths (ASX: ARR) gained after reporting the United States is considering $456 million in debt financing for the company’s Halleck Creek Wyoming project, one of the world’s largest.
The amount equals the initial capital required for the 2.3-billion-tonne project’s first stage, the Cowboy State mine, the Australian-based company said on Tuesday. The funding from the US Export-Import Bank, to be finalized after due diligence, could have a repayment term of 15 years, the bank said in a non-binding letter of interest.
American Rare Earths shares closed more than 16% stronger on the ASX on Tuesday at A$0.30 apiece. The company has a A$143.2 million market capitalization.
“This letter of interest from EXIM Bank is a significant milestone, highlighting the US government’s commitment to securing a robust domestic rare earth supply chain,” CEO Chris Gibbs said in a release. “The potential funding also paves the way to accelerate offtake agreements and attract strategic investors.”
Mining Intelligence ranked the project, being developed by American Rare Earth’s US unit Wyoming Rare, as one of the world’s top 10 rare earth projects measured in total rare earth oxides (TREO). The company envisions it as a multi-generational mine to challenge China’s dominance in producing the metals used in the magnets of electric vehicle motors.
Halleck Creek’s ore grades 3,196 parts per million (ppm) TREO including neodymium and praseodymium for 7.5 million tonnes of contained TREO, according to a resource estimate updated in February along Australian JORC regulations. The estimate includes 1.42 billion tonnes in the measured and indicated category.
“We are grateful for the recognition and support from EXIM Bank, which will be instrumental in securing the funding needed to fast-track the development of this important project,” Wyoming Rare president Joe Evers said in the same release.
The funding would come from the federal agency’s Make More In America Initiative, American Rare Earths said.
The company cancelled a plan in April to spin off Wyoming Rare into a special purpose acquisition company to be separately listed. It had sought a similar path to how MP Materials (NYSE: MP) operates the only rare earths mine in the US, Mountain Pass in California.
Wyoming Rare also holds the La Paz rare earth deposit in Arizona, the Searchlight project in Nevada and the Beaver Creek project in Wyoming.
