RCS - Rainbow Rare Earths - RBW's partner K-Tech presents at Congress hearing

Rainbow Rare EarthsAnnouncement

01/12/2023 07:00

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RNS Number : 2715V  Rainbow Rare Earths Limited  01 December 2023

1 December 2023

Rainbow Rare Earths Limited

("Rainbow" or "the Company")

LSE: RBW

 

Rainbow's partner K-Technologies, Inc. invited to present at a U.S.
Congressional Hearing on:

 

The Role of Federal Research in Establishing

a Robust U.S. Supply Chain of Critical Minerals and Materials

 

·    K-Technologies, Inc.'s ("K-Tech") innovative technology can play a
part in the development of an independent Western supply of the rare earths
vital for decarbonisation, via their use in electric vehicles and wind
turbines, and many advanced and strategic technologies

·    Rainbow has worked alongside K-Tech to jointly develop a unique
process that offers the potential to recover critical rare earths from
phosphogypsum, as is being applied at the Phalaborwa project in South Africa

·    K-Tech is a homegrown U.S. company based in Florida with extensive
expertise in the development of specialist chemical processing applications

NEWS RELEASE

Rainbow Rare Earths is pleased to announce that Mr. Thomas E. Baroody, the
President and CEO of its technical partner K-Tech, was invited to provide a
written and oral testimony at a U.S. Congressional Hearing on "The Role of
Federal Research in Establishing a Robust U.S. Supply Chain of Critical
Minerals and Materials" on Thursday 30 November 2023. K-Tech specialises in
developing and bringing-to-market chemical and processing applications to
extract desirable, commercial grade elements and other materials.

The U.S. has identified the development of an independent supply chain as of
strategic importance, both via the securement of reliable and ethical supply
of rare earth elements, as well as via the development of a U.S. down-stream
supply-chain including specialist alloy, rare earth permanent magnets, drive
trains, and ultimately electric vehicle and wind turbine manufacture. K-Tech's
inclusion in the U.S. Congressional Hearing demonstrates the role that its
technology can play in furthering these aims.

Rainbow has worked alongside K-Tech to jointly develop a unique process
flowsheet to recover economic quantities of rare earths from phosphogypsum
material, thereby opening up the opportunity to develop an independent Western
supply of the rare earths critical to decarbonisation and other strategic
areas of national importance, such as defence.

Rainbow will also be using the K-Tech proprietary continuous ion exchange and
continuous ion chromatography separation technology at its Phalaborwa rare
earth development project, which will allow for the material to be processed
into separated rare earth oxides of 99.95% purity. This separation technique
replaces traditional solvent extraction technology, which uses toxic and
flammable solvents and diluents and requires many different stages, thereby
delivering a process that is safer and more environmentally responsible, as
well as reduced capital and operating costs due to a simplified flowsheet.

A U.S. Congressional Hearing is the principle formal method by which U.S.
congressional committees collect and analyse information which goes on to
shape legislative policymaking and decisions. K-Tech was included in the
critical minerals event alongside representatives from the U.S. Department of
Energy, Stanford University, GreenMet and San Jose State University.

Mr Baroody of K-Tech's written testimony is below:

 

"The Role of Federal Research in Establishing a Robust U.S. Supply Chain

of Critical Minerals and Materials"

 

U.S. House of Representatives

Committee on Science, Space and Technology

November 30, 2023

 

Testimony of Thomas E. Baroody

President and Chief Executive Officer

K-Technologies, Inc.

Lakeland, Florida

 

INTRODUCTION

Good morning, Chairman Lucas, Ranking Member Lofgren, and members of the
Committee.  I want to thank you for the invitation to be on this excellent
panel today.  As one of the representatives of the private sector today, it
is my hope that I can provide you all with information and perspective as you
consider the vital topic of federal research and prudent taxpayer spending
married with private sector initiatives and risk-taking.  Taken together, I
believe we are building a more robust and diverse U.S. supply chain of
critical minerals and materials.  Time is of the essence and the task is
urgent.

RARE EARTH ELEMENTS AND THE HISTORIC CHALLENGE OF PROCESSING

Rare Earth Elements (REE) are available from multiple sources such as mineral
ores (generally higher grade), ionic clays (generally lower grade, bulk
tonnage) and waste materials (phosphogypsum (PG), phosphoric acid sludges,
coal mining tailings, end-of-life magnets).  Each of these sources require
different methods to liberate the contained REE, such as gravity
concentration, flotation, hydrometallurgical, and pyrometallurgical processes.

For practical and economic purposes these initial processes must be undertaken
at the source location. Intermediate products are then exported (predominantly
to China) as a mineral concentrate, typically 40% to 60% contained Rare Earth
Oxides (REO) or as a precipitate such as Mixed Rare Earths Carbonate (MREC).
These concentrates and MREC intermediate products are then processed to
produce separated and purified REO which feed the metal and alloy
manufacturers who in turn supply the magnet manufacturers.

Historically, and presently, the final stage of separating and purifying the
REE is performed by a highly inefficient, and environmentally unfriendly,
Solvent Extraction (SX) process which is independent of the REE source. This
SX process requires hundreds of mixer-settlers and virtually all of the
world's REE are produced this way in China.

K-TECH AND THE COMMERICAL INDUSTRIAL PROCESS

I would like to talk today about some of the successful business projects
K-Tech is engaged in and what we are doing to advance the goal of bringing
critical minerals into the U.S.

Over the past 15 years, K-Tech has specialized in developing and
bringing-to-market chemical and processing applications to extract desirable,
commercial grade elements and other materials.  Several alternative
technologies to SX are being researched and developed in the West and by
K-Tech. The most prospective of these technologies, for early adoption, is
Continuous Ion Exchange and Continuous Ion Chromatography (CIX/CIC). This
technology has been applied in production facilities for a variety of
industries around the world for decades and has been the focus for technology
development at K-Tech since 1987, including for REE.

K-Tech has been researching and developing CIX/CIC for application to REE
separation and purification for several years and has demonstrated the ability
to separate REE with its CIX/CIC process as a result of this research.

The CIX/CIC process has numerous advantages over the conventional SX route in
terms of economics, safety, environmental impact, and size of plant, with much
lower capital and operating cost intensity.

Over the past several years the REE markets and supply chain have seen some
rather dramatic movements, and the global market now realizes that REE from
other sources, both from a feedstock (i.e.; mining, waste tailing stacks, or
recycled scrap) and geographical standpoint, are needed. As such, there has
been a significant increase in REE sourcing assessments and evaluation of
alternate feedstock sources.

It is worth emphasizing that often we are utilizing ore from waste by-products
of other mining or processing projects from years ago. By using mining waste
as a feedstock, we are in a win-win situation whereby critical minerals are
being extracted at a lower, commercially viable cost at a benefit to the
environment.

It is well known that many phosphate rock sources contain some level of REE,
but the concentrations tend to be low, i.e., in the parts/million to hundreds
of parts/million. It is also known that during the phosphate rock digestion
process to produce phosphoric acid, the majority of the REE is not dissolved,
but remains in the phosphogypsum waste. However, some percentage of available
REE does dissolve into phosphoric acid and this is where K-Tech had initially
focused its recovery efforts.

As an example, in the production of wet process phosphoric acid, elements such
as uranium, rare earths, yttrium, vanadium, cadmium, fluorides, and silica are
usually present in small quantities. K-Tech's extraction technologies can
treat large volumes of intermediate process streams like phosphoric acid in a
continuous manner, and isolate and recover certain desired target elements in
a highly concentrated low volume solution. This solution in turn can then be
treated separately to produce one or more target elements as marketable
products.

THE EXAMPLE OF RAINBOW RARE EARTHS

Rainbow Rare Earths Limited (Rainbow) is in the business of establishing an
independent and ethical supply chain of the rare earth elements that are
driving the green energy transition and the most advanced defense articles and
systems.  They have a focus on the permanent magnet rare earth elements
neodymium, praseodymium, dysprosium and terbium.  All four of these elements
are categorized by the U.S. Government as being vital in both the short term
and medium term.

I note that Rainbow, traded on the London Stock Exchange, desires to have its
products processed and used in the U.S., North America, or allied European
markets.

Their corporate strategy meshes well with the Department of Energy's critical
mineral strategy detailed in the department's July 2023 "Critical Materials
Assessment".  That strategy document focuses on diversifying and expanding
U.S. supplies, developing alternative manufacturing processes, enhancing
material and manufacturing efficiency to reduce waste, and assisting in
stockpiling and international engagements to benefit the U.S.
(https://www.energy.gov/sites/default/files/2023-07/doe-critical-material-assessment_07312023.pdf
(https://www.energy.gov/sites/default/files/2023-07/doe-critical-material-assessment_07312023.pdf)
)

Rainbow is developing its Phalaborwa REE project in South Africa to recover
REE from phosphogypsum and has opted for the CIX/CIC process with K-Tech for
the separation and purification of the REE to produce the selected REO
products. This presents a unique opportunity for K-Tech to utilize its process
allowing separated REO to be produced, independently from China, for sale to
the U.S. and allowing development of a U.S. down-stream supply-chain including
specialist alloy, REE permanent magnets, drive trains, and ultimately EV/wind
turbine manufacture. From a national defense standpoint, magnets are a driving
force behind continuous innovation in defense technology such as
precision-guided munitions, tank navigation systems, and electronic
countermeasures equipment. Without guaranteed independent supply these
investments could not be made in the US.

The Rainbow process to produce rare earths from historic industrial waste,
cleans up legacy environmental issues and delivers a true circular economy
benefit - not just producing REE from waste, also allowing the cleaned gypsum
residue to be sold for agricultural/construction purposes.

Rainbow is also focusing on other global opportunities, including recovery of
REE from PG waste from Mosaic Fertilizantes' Uberaba operation in Brazil owned
by The Mosaic Company, a New York Stock Exchange listed U.S. multinational.
That project is at an earlier stage of development, but the Brazilian
undertaking is currently operating and would involve processing a great deal
more PG over a much longer life than in South Africa.

The overall process is split into two major parts:

1)            Front-end - production of a mixed REE product from
the PG, along with restacking of the cleaned-up benign PG into the new lined
stack for sale;

2)            Back-end - processing of the mixed REE product
through K-Tech's propriety CIX/CIC system to produce the four target REE
oxides.

If Rainbow is successful in developing a Brazilian operation like it plans in
South Africa, the back-end of the processing facility (K-Tech's CIX/CIC
system) could logically be located in the U.S. I understand that Rainbow is
starting the process to consider potential sites for a commercial plant in the
U.S.  If so, this would greatly benefit U.S. production of critical rare
earth materials.

K-Tech is currently concluding a bench scale test program on the Phalaborwa
material and has assembled a CIX/CIC pilot plant for Rainbow at its Lakeland,
Florida facility. This pilot plant will commence operation shortly on samples
of MREC shipped from Rainbow's pilot plant operation in South Africa, to
demonstrate the production of on-specification separated REO for the alloy and
magnet industry. The process in Lakeland will, for the first time, allow for
the production of separated REE battery metal oxides on a commercial basis in
the U.S. That represents a major step forward in bringing this type of supply
into the U.S.

I would also like to stress that by both public financing, private capital,
and U.S. research we are doing something else that makes the U.S.
unique-developing significant intellectual property that ensures our nation is
the technological leader for decades to come.  At K-Tech, my colleague Wes
Berry (CTO of K-Tech), the company, and I hold eight patents (soon to be nine
as one is scheduled to be issued in December 2023), of which three have been
sold to a third  party.  Also, our CTO was the inventor of the CIX/CIC
process, and holds some thirty other patents. The Rainbow and K-Tech process
teams have developed an innovative process to recover REE from PG which has
the potential to unlock the vast resource of this material worldwide with a
significant environmental benefit for these polluted sites. Rainbow and K-Tech
are jointly progressing a patent application for the process to be lodged in
the U.S.

ROLE OF FEDERAL GOVERNMENT

K-Tech is highly supportive of the federal government's efforts to support
domestic and foreign sourcing and processing, research, and project funding to
diversify a secure and sustainable supply chain for minerals that are vital to
our national defense and the global economy.  Programs undertaken by the
Departments of Energy, Defense, and Commerce and the U.S. International
Development Finance Corporation (DFC) are playing a key role in unlocking
capital to fund promising opportunities in mining and processing of REEs and
other critical minerals.

I understand that Rainbow has entered into an option agreement whereby TechMet
has the right to invest US$50 million to fund a substantial part of the equity
component for Rainbow's project in South Africa.  The DFC is an important
shareholder in TechMet.

At the state government level, we work closely with the Florida Industrial and
Phosphate Research Institute (FIPR) affiliated with the Florida Polytechnic
University. K-Tech, FIPR, and Pacific Northwest National Laboratory (PNNL) are
currently cooperating on a joint submission to DOE for funding to examine the
extraction of REE from phosphoric acid sludges. Also, in 2014-15, K-Tech
worked with Texas Mineral Resources Corp. (TMRC) on a DOE grant to
successfully recover several targeted high purity REE from TMRC's Round Top
rhyolite orebody in West Texas. K-Tech also participated with TMRC, and two
other entities, in recovering REE from coal fly ash waste from  a
Pennsylvania coal mine under a DOE grant in 2017-18.

 

 

CONCLUSION

Science at its essence is about trial and error-experimentation based on
systematic methodology based on evidence.  The U.S. has always led the world
in the field of science.  At K-Tech we are devoted to furthering science that
leads to better and practical outcomes in the area of critical minerals.

I would like to thank the Committee for the opportunity to provide you with
testimony today.  This Committee and all the other Congressional committees
with jurisdiction over the federal government's role in shaping policy on
science and technology, national security, foreign relations, and
appropriations must continue to be well-versed on the rapidly changing
environment on critical minerals.

For further information, please contact:

 

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

                                    Pete Gardner
                           IR       Cathy Malins       +44 7876 796 629

                                                       cathym@rainbowrareearths.com (mailto:cathym@rainbowrareearths.com)
 Berenberg                 Broker   Matthew Armitt     +44 (0) 20 3207 7800

                                    Jennifer Lee

                                    Detlir Elezi

 Tavistock Communications  PR/IR    Charles Vivian     +44 (0) 20 7920 3150

                                    Tara Vivian-Neal   rainbowrareearths@tavistock.co.uk (mailto:rainbowrareearths@tavistock.co.uk)

 

 

Notes to Editors:

About Rainbow:

Rainbow Rare Earths aims to be a forerunner in the establishment of an
independent and ethical supply chain of the rare earth elements that are
driving the green energy transition. It is doing this successfully via the
identification and development of secondary rare earth deposits that can be
brought into production quicker and at a lower cost than traditional hard rock
mining projects, with a focus on the permanent magnet rare earth elements
neodymium and praseodymium, dysprosium and terbium.

The Company is focused on the development of the Phalaborwa Rare Earths
Project in South Africa and the earlier stage Uberaba Project in Brazil. Both
projects entail the recovery of rare earths from phosphogypsum stacks that
occur as the by-product of phosphoric acid production, with the original
source rock for both deposits being a hardrock carbonatite. Rainbow intends to
use a proprietary separation technique developed by and in conjunction with
its partner K-Technologies, Inc., which simplifies the process of producing
separated rare earth oxides (versus traditional solvent extraction), leading
to cost and environmental benefits.

The Phalaborwa Preliminary Economic Assessment has confirmed strong base line
economics for the project, which has a base case NPV(10) of US$627 million, an
average EBITDA operating margin of 75% and a payback period of < two years.
Pilot plant operations commenced in 2023, with the project expected to reach
commercial production in 2026, just five years after work began on the project
by Rainbow.

More information is available at www.rainbowrareearths.com
(http://www.rainbowrareearths.com/) .

 

About K-Tech

K-Tech specializes in the development of process technologies that require
unique recovery and/or component separation demands, especially those related
to continuous separation methodologies. These can be accomplished internally
or in conjunction with its clients.

In particular, the company has focused on various separation processes
involving continuous ion exchange, continuous chromatography and advanced
sorption techniques as they apply to a variety of chemical and environmental
applications. K-Tech also has extensive knowhow and experience related to
various solvent extraction processes and methods, as well as knowledge of a
variety of separation techniques as adjuncts to its core methodologies, e.g.
reverse osmosis, distillation, crystallization, and the like.

More information is available at www.ktech-inc.com (http://www.ktech-inc.com)
.

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