Canada Rare Earth Forges Agreement to Acquire A Rare Earth Refinery

Canada Rare Earth Corporation (CRE) has reached an agreement in principle to acquire a rare earth refinery. Peter Shearing, the company's chief operating officer, said, "The refinery is based on technology already deployed by other rare earth processors and can produce approximately 3,000 metric tons of complete rare earth oxides."

Tracy A Moore, CEO of Canadian Rare Earth, said, "Negotiations are 'going very well' and moving quickly towards a 'definitive agreement'." The company revealed that it reached an agreement in principle on April 24, 2022, to purchase an existing rare earth refinery located in Southeast Asia.

In a statement, Peter Shearing, chief operating officer of Rare Earths Canada, said the refinery is based on technology and processes already deployed and produced by a dozen other rare earth processing plants and can produce about 3,000 metric tons, or 3 million kilograms (kg) of rare earth oxides in the full spectrum.

Shearing noted: "The ability to produce high specification neodymium (Nd), praseodymium (Pr), dysprosium (Dy), and terbium (Tb) oxides are critical to the rapidly developing and growing electrification and electric vehicle (EV) market segment. These valuable elements are trading at strong price levels and the current level of output from existing facilities cannot fully meet demand. For example, according to Baiinfo, Nd and Pr are currently selling for approximately $135 per kilogram, while Dy and Tb are selling for $397 and $2,200 per kilogram, respectively."

Moore added, "The price will take into account two licensing scenarios: receipt of an operating license and pending. It is anticipated that the definitive agreement will contain the detailed commercial and proprietary terms customary for such documents, and we have been involved in this refinery for several years and believe that now is the best time to move forward with the acquisition."

"With Canada Rare Earth's supply of rare earth concentrates steadily increasing, we are confident that we can provide the refineries with the concentrate feedstock required for current capacity and to support expansion plans in the coming years," Shearing noted, "We are also working to expand our sources, particularly domestically, to supply the refinery and meet the needs of our existing customer base."

Rare Earths Canada's focus is on generating revenue and positive cash flow from various profit centers in the rare earths production and distribution chain by sourcing, adding value, and selling rare earths in all stages and forms. The company is building its own mining, enrichment, and rare earth refinery capabilities. The Vancouver, British Columbia-based company, which is developing a vertically integrated business within the global rare earths industry, noted that the acquisition is contingent on the finalization of a definitive agreement and “arranging financing”.

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