Wednesday proved a pivotal day for many – and not just the good burghers of the US who ensured a political outcome that is sparking much soul-searching across the world.
Back in Perth, shareholders of heavy rare earths proponent Northern Minerals (ASX: NTU) delivered one of the more emphatic thumbs-up seen across the ASX over the past few months when they signed off on the company’s $43 million equity raising.
The raising, launched in September, was structured as a two-tranche placement conditional on shareholder approval.
The two resolutions were approved by 99.4 per cent of voting shareholders, not just securing Northern Minerals’ immediate funding strength but providing a welcome vote of confidence in the company’s relatively new management team of executive chairman Adam Handley and managing director Shane Hartwig.
The funds, complemented by $3.8 million raised from a share purchase plan, will allow Northern Minerals to advance pre-development activities at its flagship asset, Browns Range.
Browns Range, in the east Kimberley region of Western Australia, contains one of the world’s most promising deposits of dysprosium and terbium (DyTb), two heavy rare earths needed in a clean economy.
A mineral resource update is imminent and will feed into an updated definitive feasibility study, which will hopefully lead to a positive final investment decision in the first half of next year.
“Northern Minerals was extremely pleased with the level of engagement from both existing and new shareholders and particularly the interest shown in Browns Range,” Mr Hartwig told shareholders.
“This engagement included meeting with many domestic and international institutional investors, existing major shareholders and an extensive call-out program with the company’s significant retail base.
“We thank all our shareholders for their support and look forward to providing you with ongoing updates as the team completes the key milestones towards progressing the development of Browns Range.”
Much has been written about the rare earths industry and the rhetoric from non-China-based project proponents, including Northern Minerals, to break the Middle Kingdom’s stranglehold on the supply of rare earths such as DyTb and neodymium and praseodymium (NdPr).
It is tough going for the ASX-listed rare earths proponents, which is why Northern Minerals’ ability to raise a significant amount of cash and secure overwhelming endorsement from shareholders this week is a major fillip.
Low rare earths prices, the technical challenges of developing these projects and the size of capital required make for significant headwinds.
And today’s unconfirmed reports that senior executives of Perth-based gold miner Resolute Mining (ASX: RSG) had been arrested in Mali, where its Syama operation is located, add another sovereign risk headache for those ASX-listed rare earths players with assets in Africa.
Africa is unlikely to be an immediate target for the Trump #2 Administration once the re-elected President is inaugurated in January.
But China relations will likely be a priority for President Trump, as will be protecting the US economy through stimulating local industries.
How all this plays out for ASX rare earths players talking up their role as a key plank of a non-China-controlled battery minerals supply chain remains to be seen.
Certainly Northern Minerals, which has an agreement to send DyTb concentrate to Iluka Resources’ (ASX: ILU) under-construction refinery at Eneabba, also in Western Australia, will be talking up the strategic importance of Browns Range.
Just two days after the Northern Minerals shareholder meeting, the ASX rare earths leader Lynas Rare Earths (ASX: LYC) finally cut the ribbon at its Kalgoorlie cracking and leaching plant – almost two years later than hoped.
It has been a long journey for Lynas, which first announced plans for the Kalgoorlie plant – to enable downstream processing of its Mt Weld rare earths and appease unhappy regulators in Malaysia, where Mt Weld product has been treated – in 2019.
Officially opening the Kalgoorlie plant on Friday, Lynas stuck to a $800 million price tag and talked up the speedy construction time of 2½ years.
A 10-minute power outage across Kalgoorlie during the Lynas plant opening – the latest in a series of power reliability issues affecting the Goldfields capital that will become a major local issue in the March 2025 State elections – did not curb enthusiasm at the party.
“As the only significant ex-China producer of separated rare earths, Lynas plays an important role in the rare earths supply chain,” Lynas managing director Amanda Lacaze said about the opening.
“Today’s ceremony to officially open the facility is an exciting milestone. This was an ambitious project, which established downstream rare earths processing in Australia for the first time.”
Northern Minerals’ Mr Hartwig was also not backward in highlighting the potential importance of an Australian rare earths supply stream.
“Browns Range is a globally significant heavy rare earths project containing high grades of dysprosium and terbium,” he told his shareholders on Wednesday.
“With increasing restrictions being placed on mining and processing of rare earth elements in China and ongoing conflicts in Myanmar which is a large source of China’s heavy rare earths supply, Browns Range has the potential to be an important part of an emerging alternate supply chain for rare earth oxides used in clean technology applications.”
The capital markets are sometimes slow if not reluctant to factor in longer-term strategic trends – something the ASX battery minerals sector hopes will change.
Just ask St George Mining (ASX: SGQ), which is completing the acquisition of what could be a significant niobium project in Brazil, right next door to the world’s dominant niobium producer.
In the short term, of course, the world will wait with bated breath to see what the 45th and 47th President of the United States has in store for all of us.
