SYDNEY: Brazilian Critical Minerals Limited said its wholly owned Brazilian subsidiary, Mineração BBX do Brasil Ltda, has executed a binding agreement to acquire a 90% interest in Sais Nordeste Indústria e Comércio Ltda, an established magnesium sulphate producer in Feira de Santana, Bahia.

The company said the deal will establish domestic Brazilian production of magnesium sulphate, the principal leaching reagent proposed for the Ema Rare Earth Project’s in-situ recovery process. Sais Nordeste has been under care and maintenance since February 2026.

BCM said initial production capacity is expected to supply approximately 50% of Ema’s magnesium sulphate requirements, with potential to produce more than 100% of the project’s forecast needs.

The company said securing domestic magnesium sulphate production is intended to materially reduce Ema’s exposure to Chinese reagent supply chains and strengthen its control over the availability, quality and continuity of a critical input to ISR.

Under the transaction structure, BCM will immediately commence funding and overseeing the financial and operational restructuring of Sais Nordeste, including the treatment and renegotiation of legacy liabilities. Formal ownership of the 90% interest will transfer at completion following satisfaction of conditions precedent and required approvals.

BCM said it will acquire the magnesium sulphate production plant for a nominal cash consideration of 1 real, together with the assumption of certain identified taxation liabilities. The restructuring will include renegotiation of federal and state tax liabilities and other legacy obligations, currently estimated at 15.3 million reais (approximately A$4.2 million), the majority of which is to be scheduled for payment over a 10-year period.

The company said an engineering design and modifications assessment has already commenced to determine the work required to adapt the plant to the Ema Project’s needs.

BCM has also secured local Brazilian supply agreements for magnesium oxide and sulphuric acid, the principal raw materials used to produce magnesium sulphate. Sulphuric acid can be supplied from UNIGEL at the Camaçari industrial complex, about 80 kilometers away, while magnesium oxide is to be sourced from Bahia’s magnesite and MgO industry centered on Brumado, approximately 560 kilometers from the processing plant.

“Magnesium sulphate is the principal leaching reagent proposed for our ISR success story,” said Andrew Reid, managing director of BCM. “Securing an established Brazilian production platform for this critical reagent gives BCM the opportunity to build greater control and resilience into the Ema supply chain and materially reduce our exposure to third-party reagent supply.”

Reid said stage 1 production capacity is expected to supply approximately 50% of Ema’s magnesium sulphate needs over the first few years of production.

“We view this as a strategic upstream investment that is at least as important to Ema as downstream integration,” he said. “Before we can supply the emerging rare earth separation and refining industry outside China, we must first ensure that Ema can reliably produce MREC.”

Sais Nordeste is a Brazilian industrial chemicals business with more than five decades of operating history in magnesium sulphate manufacture. The plant was fully functional until February 2026, when the company was placed into Brazilian Bankruptcy and Reorganization Law proceedings after becoming unable to meet its financial obligations.

BCM said the existing shareholders remain the registered owners of Sais Nordeste until completion, with the remaining 10% retained by the existing shareholder.

The Ema Rare Earth Project is an ionic adsorption clay rare earth project located near Apuí in Amazonas State, Brazil. The project is being developed using in-situ recovery, with magnesium sulphate solution used to recover rare earth elements from the mineralized clay profile.