LONDON: Rainbow Rare Earths announced the signing of a binding Agreement for Co-Development of the Phalaborwa Rare Earths Project, located in South Africa, with Bosveld Phosphates (Pty) Ltd. 

The Project comprises approximately 35 million tonnes of gypsum resulting from historic phosphate hard rock mining, containing rare earth elements (REE) with an estimated average in situ grade of 0.6% Total Rare Earth Oxides (TREO), based on previous sampling campaigns.

Rainbow and Bosveld intend to jointly develop and process rare earth elements from the gypsum contained in two stacks at the Project site.

Initial grab sample assays from the c. 35 million tonnes Gypsum Stacks indicate 0.6% TREO, indicating c. 210,000 tonnes of contained TREOs, with Neodymium (Nd) and Praseodymium (Pr) (together “NdPr”) anticipated to constitute c. 30% of the TREO basket.

The unique nature of these Gypsum Stacks results from the historic concentration of REEs during Foskor’s flotation process, followed by further upgrading in Sasol’s PhosAcid Plant, leading to REE concentration in chemical (rather than mineral) form, which enables simpler onward processing.

Sasol developed a comprehensive process flowsheet to extract the rare earths from the gypsum, which resulted in a successful pilot plant operation, producing c. 3 tonnes of mixed rare earth carbonate at c. 80% recoveries.

Initial reports suggest low levels of radioactive elements, similar to those seen at Rainbow’s Gakara Project, in Burundi. The Project is fully permitted, with an Environmental Impact Assessment completed.

The re-processing of these Gypsum Stacks carries significant environmental benefits in that it will redeposit clean, benign gypsum, which then has the potential for further use in the building and fertiliser industries.

A total consideration of US$750,000, in a combination of cash and shares shall be paid by Rainbow to Bosveld in three equal tranches over twelve months, with the first tranche being payable after completion of an initial due diligence process. 

The due diligence process is expected to last up to 35 days and a further announcement will be made on completion of the due diligence process.

On completion of the pre-feasibility study (PFS), 70% of the Project will held by Rainbow and 30% by Bosveld, with a mechanism included to allow for Rainbow’s Joint Venture ownership to vary from 60% to 85%, dependent on results of the PFS.

George Bennett, CEO, said: “This Joint Venture represents an important and exciting step in Rainbow’s strategy to benefit from the expected growth in global demand for rare earth metals.  The considerable amounts of historical test work carried out to date, together with positive initial assays and successful pilot plant operations, indicate that this opportunity, in conjunction with the Company’s high-grade Gakara Project, will enable Rainbow to become a very significant producer of NdPr, to power the green revolution.

This Joint Venture positions Rainbow as the only REE producer with both country and project diversification.”