RCS - Rainbow Rare Earths - COP 26 Resolutions

Rainbow Rare EarthsAnnouncement

01/12/2021 07:00

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RNS Number : 1177U  Rainbow Rare Earths Limited  01 December 2021

 

 

1(st) December 2021

 

Rainbow Rare Earths Limited

("Rainbow" or "the Company")

LSE: RBW

 

COP26 Resolutions - a bright future for Rainbow Rare Earths

 

The 2021 United Nations Climate Change Conference of Parties ('COP26')
recently closed with the adoption - by consensus of nearly 200 countries - of
the Glasgow Pact, which seeks to increase climate ambition and action by
keeping the target of 1.5C alive, as well as finalising the outstanding
elements of the Paris Agreement.

 

Importantly, the deal struck has codified new rules to reduce greenhouse gas
emissions, including the gradual phasing down of fossil fuel consumption and
the reduction of the global carbon market. Key to achieving this will be the
advancement of the green revolution, which aims to massively curtail the use
of Internal Combustion Engines ('ICE') and facilitate the greater utilisation
of renewable energies and widespread adoption of green technology. These
low-carbon greener technologies, however, have an intensive mineral demand.

 

The Importance of High-Strength Permanent Magnets

 

Central to this demand are Rare Earth Elements ('REE') - in particular,
Neodymium and Praseodymium ('NdPr') and Dysprosium ('Dy'), which are used to
make compact high-strength permanent magnets used in the motors of hybrid and
Electric Vehicles ('EVs') and wind turbines powering the greener
electrification era for the international community. These permanent magnets
are also used in aerospace and the defence industries' satellite technology,
and, across their varied sector uses, directly impact between US$5 trillion to
US$10 trillion in global GDP. As a result, with the projected demand for REE
expected to increase as much as ten times between 2030 and 2040, they have
been designated as critical and strategic metals by the US Federal Department
of the Interior, the Government of China, and the EU Parliament, as they
promote a drive toward greater raw material security and sustainability.

 

To put this into a local UK context, in their letter to the Committee on
Climate Change, leading UK scientists noted that, in order to replace all
UK-based vehicles with EVs, at least 7,200 tonnes of neodymium and dysprosium
would be needed, requiring a 70% increase in annual production.(( 1 ))

 

While rare earths are not rare from a geological perspective, they are not
commonly found in economically viable concentrations, and, in addition to
being generally low grade, often have high levels of radioactivity owing to
the presence of thorium, which increases processing requirements and heightens
safety concerns both operationally and environmentally. Furthermore, 85% of
the world's REEs are currently produced by China, which has a significant
impact on global supply and demand dynamics.

 

RRE - The Phalaborwa Project

 

With its exciting project-in-development in South Africa, Rainbow Rare Earths
is well positioned to meet the anticipated demand and supply gap. In
particular, the high grade and low-cost nature of the Phalaborwa Project,
coupled with its anticipated utilisation of the latest, state-of-the-art
processing technology, sets Rainbow well apart from its peers in its value and
environmental proposition. Rainbow has the near-term opportunity to develop an
independent, western Rare Earths supply chain and become a significant,
responsible producer of NdPr, with regulatory oversight.

 

Rainbow Rare Earths CEO, George Bennett, commented:

"The resolution that follows the discussions of COP26 and the affirmation of
the Paris Agreement six years in the making to adhere to net-zero carbon
emissions, is a crucial factor in the dramatic increase of sustainable forms
of energy production. Rainbow Rare Earths is in a pivotal position to provide
the foundational materials required to advance this clean technology and the
green revolution.

"The Phalaborwa Project can be brought into production quickly, with low
capital and operating expenditure, in an environmentally responsible manner to
deliver a high-grade oxide. In the processing of material from the existing
gypsum stacks at Phalaborwa, we aim to deliver a clean rare earths project,
removing environmental liability and redepositing benign gypsum on a new
stack, built according to International Finance Corporation ("IFC")
Performance Standards and Equator Principles.

"The codification of international net-zero carbon targets cements Rainbow's
position as company working towards a green future, directly contributing to
the alleviation of climate change through a responsible, sustainable, and
independent supply chain for Rare Earth Elements."

 

**ENDS**

 

For further information, please contact:

 

 Rainbow Rare Earths Ltd                          Company  George Bennett     +27 82 652 8526

                                                           Pete Gardner
 SP Angel Corporate Finance LLP                   Broker   Ewan Leggat        +44 (0) 20 3470 0470

                                                           Charlie Bouverat
 Flagstaff Strategic and Investor Communications           Tim Thompson       +44 (0) 207 129 1474

                                                           Fergus Mellon      rainbowrareearths@flagstaffcomms.com
                                                                              (mailto:rainbowrareearths@flagstaffcomms.com)

 

Notes to Editors:

Rainbow's strategy is to become a globally significant producer of rare earth
metals. Nd/Pr are vital components of the strongest permanent magnets used for
the motors and turbines driving the green technology revolution. Analysts are
predicting demand for magnet rare earth oxides will grow substantially over
the coming years, driven by increasing adoption of green technology, pushing
the overall market for Nd/Pr into deficit.

 

The Phalaborwa Rare Earths Project, located in South Africa, comprises an
Inferred Mineral Resource Estimate of 38.3Mt at 0.43% total rare earths oxides
("TREO") contained within gypsum tailings stacked in unconsolidated dumps
derived from historic phosphate hard rock mining.  High value Nd/Pr oxide
represent 29.1% of the total contained rare earth oxides, with economic
Dysprosium and Terbium oxide credits enhancing the overall value of the rare
earth basket contained in the stacks.  The rare earths are contained in
chemical form in the gypsum dumps, which is expected to deliver a higher-value
rare earth carbonate, with lower operating costs than a typical rare earth
mineral project.

 

The Company's Gakara Project in Burundi has produced one of the highest-grade
concentrates in the world (typically 54% TREO) through trial mining
operations.  The Gakara basket is weighted heavily towards Nd/Pr, which
account for over approximately 19.5% of the contained TREO and 85% of the
value of the concentrate.

 

 

 

 1  Source:
https://www.nhm.ac.uk/press-office/press-releases/leading-scientists-set-out-resource-challenge-of-meeting-net-zer.html
(https://www.nhm.ac.uk/press-office/press-releases/leading-scientists-set-out-resource-challenge-of-meeting-net-zer.html)

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