Australian heavy rare earths developer Northern Minerals Limited (ASX: NTU) has announced the outcomes of a definitive feasibility study for the company’s 100%-owned Browns Range heavy rare earths project, located in the East Kimberley region of Western Australia.
The DFS underscores the global strategic value of Browns Range and demonstrates its technical and financial viability.
Highlights
Strategic heavy rare earth element (HREE) asset underpinned by project’s technical and financial credentials
- The global shift towards reducing carbon emissions and adopting renewable energy technologies requires scaleable and stable supply of critical minerals such as heavy rare earth elements.
- These HRREs components are used in numerous applications such as clean energy technologies, advanced defence systems, medical applications, humanoid robotics, automotive applications and consumer electronics.
- China overwhelmingly dominates HREE production, controlling nearly all global output and refining capacity (~99%), the Browns Range project is seeking to loosen this global stranglehold over these critical transition elements.
- Ongoing geopolitical landscape has reinforced the strategic nature of HREE projects like Browns Range and the need for the development of an Australia-based supply chain.
- Browns Range’s value is underscored by actions by governments around the world to reduce reliance on single country supply chains through policies such as the Australian Government’s Critical Minerals Strategy including the introduction of its proposed critical minerals stockpile, the US Defense Production Act and the EU Critical Raw Materials Act.
- Located in the Tier 1 mining jurisdiction of Western Australia, the DFS outlines the Project’s technical and financial viability and highlights the strategic significance of the project as a near-development source of dysprosium and terbium (Dy/Tb), two of the most critical HREE required for high-performance permanent magnets ubiquitous in clean energy technologies.
- The Wolverine HREE deposit contains one of the highest known proportions of Dy/Tb among rare earth element deposits outside of China with the DFS outlining that the project is forecast to produce ~8% of the current global Dy/Tb supply. The project is one of the most advanced pure-play HREE projects of scale outside of China and the only one in Australia, with first production targeted from 2028 to meet a forecast global shortfall in Dy/Tb supply.
Offtake arrangements with Tier 1 partner
- The company has a long-term supply agreement with Iluka Resources for a binding contract to supply 30,500 tonnes of Total Rare Earth Oxides (TREO) contained within a 20-30% xenotime concentrate to Australia’s first fully integrated rare earths refinery at Eneabba, also in Western Australia.
- Strategic product synergy, as the HREE-rich concentrate from Browns Range will enhance Iluka’s rare earth portfolio, strengthening Australia’s critical minerals capabilities
- Northern Minerals will contribute to Australia’s efforts to establish a fully domestic value chain, reducing Western dependency on Chinese processing and setting a benchmark for secure, sovereign supply chains.
Ore Reserve estimate
- The Ore Reserve Estimate (ORE) for Browns Range is 5.18 Mt at 0.88% TREO for 45,800 t of TREO, reported in accordance with the JORC Code.
- Dy/Tb accounts for ~70% of the Browns Range total rare earths basket value.
- The ORE is based on the outcomes of the DFS and the Mineral Resource estimate update announced 16 January 2025.
- The ORE is classified as 100% Probable Ore Reserve.
Mine Plan
- The project mine plan includes open pit mining transitioning to underground mining with production predominantly via end-on longitudinal sublevel caving.
- The project is expected to include 12 years of mining, supporting an 11-year Life of Mine (LOM) defined as the period from first to final concentrate production.
DFS outlines a technically robust project
- A robust and industry proven flowsheet has been developed by extensive bench scale and pilot plant test work, which validated the metallurgical performance of processing feed from the Wolverine deposit.
- Front-end Engineering and Design (FEED) activities have commenced, supporting progress toward project delivery and development readiness.
- The Browns Range project site has an operational camp and airstrip, which will assist in accelerated commencement of construction.
Key project economics and assumptions
- Project forecast pre-production capital is A$592 million including A$77.5 million in contingency.
- Project forecast operating costs are ~A$129M per annum with C1 operating cost of A$31.25/kg TREO (excluding corporate costs).
- Project production plan forecast to produce ~17,500 tpa of xenotime concentrate at ~25% TREO, containing ~4,350 tpa TREO.
- The project forecast delivers an average annual EBITDA of A$175 million, a pre-tax NPV of A$187 million and a pre-tax ~IRR of 12%, with a seven-year payback using Base Case pricing forecasts by independent analysts CRU International, achieving a US$107/kg TREO Browns Range average LOM basket price.
- The Base Case forecast by CRU assumes that magnet REO prices will increase over the next decade as the market enters a sustained market deficit due to rising demand and slow supply response outside of China.
- The Divergence Case forecast by CRU outlines a potential price upside scenario for non-China supply to satisfy ex-China demand supported by recent trade restrictions, geopolitical factors and government policies and regulations focusing on establishing new supply chains outside of China.
- The Divergence Case forecast delivers a Project pre-tax NPV of A$705 million and pre-tax IRR of 21%, with a 5.6-year payback.
Sound ESG credentials
- The project is based on 10+ years of baseline environmental surveys and data collection and incorporates 10+ years of cultural heritage surveys and monitoring.
- The project has executed Native Title Agreements with the Traditional Owner groups.
- The Company has an approved Australian Industry Participation Plan in place to support local engagement prioritising the East Kimberley community.
Strong government agencies interest
- The company has and continues to receive strong interest from government agencies in Australia and other countries keen to establish new and sustainable rare earth supply chains.
- Project finance discussions are ongoing with export credit agencies in Australia, the US and Europe.
Ongoing work programs
- The Wolverine deposit remains open at depth, providing opportunity for potential resource expansion.
- The company is undertaking technical work programs to confirm the viability of incorporating satellite deposits as blending material in the first 30 months of processing operations.
Commenting on the DFS, Northern Minerals managing director Shane Hartwig said:
“The completion of this DFS is a major milestone for Northern Minerals and reaffirms the strategic potential of Browns Range as a globally significant, near-term source of critical heavy rare earths.
“The DFS outlines a commercially viable, technically robust project with significant upside potential, conditional on ongoing work programs and the strong forecast HREE prices being realised. With the Iluka offtake deal, supportive governments in Australia and overseas and key approvals received, we are well positioned to move with confidence to the next stage of Browns Range’s development.
“Rare earth pricing structures remain opaque given the dominance of Chinese supply and until recently have yet to factor in the strategic imperative recognised and articulated by governments in the US and Europe for rare earth supply chains based outside of China. While certain reported index prices for heavy rare earths like dysprosium and terbium remain subdued, leading industry experts are forecasting a significant supply deficit to emerge by 2028. Browns Range is one of the most advanced HREE project in the world, ideally positioning Northern Minerals to capitalise on this forecast supply deficit.
“The current Browns Range project shape contained within the DFS is based only on the Wolverine Mineral Resource Estimate. The company will continue to undertake ongoing exploration across the broader significant project tenure to expand the development profile of the project.
“The global push to decarbonise is undeniable and irreversible, reinforcing the strategic value of projects like Browns Range to supply the raw materials that will enable the energy transition.
“This DFS lays the foundation for bringing Browns Range into production, with our focus now shifting to securing the right funding solution to enable construction commencement in line with our schedule as Northern Minerals sets about delivering long-term, sustained value for our shareholders.”
