REG - Rainbow Rare Earths - Access to Rare Earth Opportunity in South Africa

Rainbow Rare EarthsAnnouncement

06/06/2022 07:00

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RNS Number : 6865N  Rainbow Rare Earths Limited  06 June 2022

 

6 June 2022

Rainbow Rare Earths Limited

("Rainbow" or "the Company")

LSE: RBW

 

Rainbow Accesses Rare Earth Opportunity in South Africa to
Demonstrate Separation Technology Expertise

 

Rainbow Rare Earths Limited announces that it has entered into a Memorandum of
Understanding ("MoU") with a diversified chemicals group based in South Africa
(the "chemicals group") to investigate the opportunity of extracting rare
earth elements from a nitro phosphate process stream at its phosphoric acid
production plant near Johannesburg in South Africa.

Under the terms of the MoU, Rainbow will conduct a rare earths extraction
pilot study with the chemicals group, which will involve initial grade test
work on processing stream material. This will be followed by a technical
programme to confirm a flowsheet using Rainbow's knowledge and intellectual
property ("IP") gained from work carried out to date at the Company's
Phalaborwa Rare Earths Project ("Phalaborwa") in South Africa, including the
licenced K-Technologies, Inc. ("K-Tech") separation technology.

The feedstock for the phosphoric acid production plant originates from the
same ore originally mined by Foskor that generated the two gypsum stacks at
Phalaborwa. Rainbow has already completed preliminary sampling of the
processing stream, with initial results indicating a Total Rare Earth Oxide
grade of 0.81% total rare earths oxides ("TREO"), with a circa 27% weighting
to high-value neodymium and praseodymium ("NdPr"), alongside economic levels
of terbium and dysprosium, similar to Phalaborwa.

Direct costs associated with the pilot study conducted by Rainbow using its
exclusive IP and technology will be financed by the chemicals group.  Subject
to a successful outcome, the parties intend to negotiate terms for a potential
joint venture agreement to extract value from the rare earths present in the
phosphoric acid processing stream.

Rainbow Rare Earths CEO, George Bennett, commented: "This project allows us to
partner with a global chemicals business and demonstrates the significance and
broader application of our IP and technology at another project in South
Africa. This is a very exciting opportunity for Rainbow to release additional
value from a nitro phosphate processing stream by efficiently producing
separated rare earths, which are currently untapped within the phosphoric acid
production process.

As at our Phalaborwa Project, the rare earths in this stream are contained
within an acid solution in a 'cracked form', which will allow us to apply the
rare earths separation technology, thereby facilitating a simple process with
significantly fewer extraction and separation steps than a traditional rare
earth mining project.

Through our processing projects, which have fundamentally different risk
profiles to traditional rare earth mining projects, we see enormous potential
to facilitate near-term access to sources of critical permanent magnet rare
earths, which are required to decarbonise energy systems in an environmentally
responsible way."

**ENDS**

Market Abuse Regulation ("MAR") Disclosure

This announcement contains inside information for the purposes of Article 7 of
the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law
by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is
disclosed in accordance with the Company's obligations under Article 17 of
MAR.

 

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
 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:

Rainbow's strategy is to become a globally significant producer of rare earth
metals. NdPr and Dy 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 NdPr and Dy into deficit.

 

The Phalaborwa Rare Earths Project, located in South Africa, comprises an
Inferred Mineral Resource Estimate of 38.3Mt at 0.43% TREO contained within
gypsum tailings stacked in unconsolidated stacks derived from historic
phosphate hard rock mining. High value NdPr oxide represents 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 in the stacks.
The rare earths are contained in chemical form in the gypsum stacks, which is
expected to allow high-value separated rare earth oxides to be produced 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
rare earth concentrates in the world (typically 54% TREO) through trial mining
operations. The Gakara basket is weighted heavily towards NdPr, which account
for approximately 19.5% of the contained TREO and 85% of the value of the
concentrate. The Gakara project is currently on care and maintenance at the
request of the Government of Burundi.

 

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