REG - Rainbow Rare Earths - Mosaic Agreement and Uberaba Economic Assessment

Rainbow Rare EarthsAnnouncement

11/03/2026 07:00

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RNS Number : 1073W  Rainbow Rare Earths Limited  11 March 2026

11 March 2026

Rainbow Rare Earths Limited

("Rainbow" or "the Company")

LSE: RBW

 

Rainbow signs Agreement with the Mosaic Company ("Mosaic") and releases
Positive Economic Assessment on the Uberaba Project in Brazil

 

·   Economic Assessment ("EA") confirms Uberaba as a second major
opportunity for Rainbow, with the project expected to be a long-life,
high-margin and near-term producer of both light and heavy rare earth elements
("REE")

·    Using Rainbow's internal 10% discount rate and rare earth pricing
reported by Argus Media Limited ("Argus") at March 2026, the Uberaba EA
post-tax NPV(10) is US$916 million, with a post-tax IRR of 45%, average EBITDA
of US$217 million per annum over a 30 year life-of-mine, and a pay-back of 1.7
years

·    Using the 13.5% discount rate applied in the Economic Assessment and
rare earth pricing reported by Argus at 5 March 2026, the Uberaba EA post-tax
NPV(13.5) is US$609 million

·    A Joint Project Development Agreement has been signed with Mosaic
further to the positive financial results of the EA to pursue a
pre-feasibility study ("PFS") for the Uberaba project and in the event of a
positive outcome of the PFS proceed to a definitive feasibility study ("DFS")

·  Before commencement of the DFS phase the parties will negotiate Heads of
Terms for a joint venture agreement and a shareholders agreement for the
jointly held JV Company ("JVCo") which is agreed to be held 51% Mosaic and 49%
Rainbow

·    Rainbow and Mosaic are targeting initial production for 2030, subject
to further studies, regulatory approvals, financing arrangements, investment
decisions, and successful project execution

·    Brazil is rapidly emerging as a rare earth hub for the Americas, with
strong interest in funding and support from the USA and aligned territories

 

NEWS ANNOUNCEMENT

Rainbow Rare Earths announces an EA for the Uberaba project in Brazil and that
it has reached an agreement with Mosaic (NYSE: MOS), the world leading Tampa,
Florida-based American producer and marketer of concentrated phosphate and
potash crop nutrients, to take the project forward.

 

The Uberaba project is similar to Rainbow's flagship Phalaborwa project in
that it will entail the processing of phosphogypsum, a "waste" product that is
the residue from phosphoric acid production, and will use Rainbow's
intellectual property ("IP") to economically extract both light and heavy REE.
By recovering critical REE from secondary sources, these projects eliminate
many of the costs and risks associated with traditional REE mining projects,
and as such are situated at the bottom of the industry cost curve.

 

George Bennett, CEO, commented: "The results of the EA confirm that Uberaba
represents a major opportunity to replicate Phalaborwa as an additional
high-margin and near-term REE development project, situated in the lowest-cost
quartile for the industry. We are looking forward to applying all the
learnings that have been made in the development of Phalaborwa's flowsheet,
which provide the opportunity to develop Uberaba on a faster timescale.

 

The project is based in Brazil, a favourable jurisdiction which is emerging as
an important hub for rare earths in the Americas and has been identified as a
strategic partner in the development of supply chain independence by the USA.

 

We have enjoyed working alongside our partner Mosaic, who has provided
important technical and operational expertise, as well as a willingness to
innovate and make quick progress, and we are delighted to have signed the
Joint Project Development Agreement with them to take the project forward."

 

Uberaba Economic Assessment

The Uberaba project is located in the Minas Gerais state of Brazil where
Mosaic is currently mining phosphate rock and producing phosphoric acid for
use in the fertiliser industry. The EA envisages building a processing plant
on-site to process the phosphogypsum waste residue at an annual throughput of
ca. 2.7 Mtpa over an initial project life of 30 years. There is excellent
potential to extend this life due to the underlying long life of the phosphate
feedstock at Uberaba.

 

The flowsheet that has been defined for the EA uses Rainbow's background IP
developed for the Phalaborwa project, further supported by collaborative test
work between Rainbow and Mosaic. The phosphogypsum from the Uberaba phosphoric
acid process facility is treated for REE extraction, with the aim of
delivering separated neodymium and praseodymium ("NdPr") oxide and a samarium,
europium and gadolinium plus ("SEG+") product that is rich in medium and heavy
REE, each at +99.5% purity. The chemically processed and cleaned phosphogypsum
stream is then returned to the Mosaic Uberaba process facility.

 

Rainbow has presented the base case economics on the basis of spot rare earth
prices published by Argus on 5 March 2026 assuming 100% payability for a
combined NdPr product and 70% payability for the SEG+ product. The NPV is
presented at a 10% discount rate, which matches the discount rate used for
Rainbow's Phalaborwa project.

 

Key findings of the EA at current rare earth pricing:

                                                           Base case
 Basket price                              US$/kg(1)       128
 Post-tax NPV using a 10% discount rate    US$ million     916
 Post-tax NPV using a 13.5% discount rate  US$ million     609
 Post-tax IRR                              %               45%
 Capital Expenditure                       US$ million     279
 Revenue(2)                                US$ million pa  319
 Operating Cost                            US$/kg¹         38
 EBITDA                                    US$ million pa  217

 NdPr oxide                   Tonnes pa(2)  1,971
 SEG+, including:             Tonnes pa(2)  659

 ·    Dysprosium ("Dy")                     60

 ·    Terbium ("Tb")                        14

 ·    Yttrium ("Y")                         188
 Payback                      Years         1.7

1.   Basket price and operating costs calculated on 100% payability basis for
NdPr and SEG+ weighted in-line with the feedstock grade

2.    Revenue and production statistics based on steady state throughput
excluding ramp up during commissioning phase

 

Rare earth price sensitivity

The sensitivity to rare earth prices has been calculated by reference to a 10%
increase or decrease to the base case forecast. The key financial metrics of
the Uberaba Project under these different scenarios are set out below:

                                     Base case  -10%   +10%
 Basket price        US$/kg          128        115    141
 Post-tax NPV(10)    US$ million     916        757    1,075
 Post-tax NPV(13.5)  US$ million     609        495    723
 Post-tax IRR        %               45%        40%    50%
 Revenue(2)          US$ million pa  319        287    351
 EBITDA              US$ million pa  217        185    248
 Payback             Years           1.7        1.9    1.6
 Change in NPV(10)   US$ million     -          (159)  159

1.     Basket price calculated on 100% payability basis for NdPr and SEG+
weighted in-line with the feedstock grade

2.     Revenue based on steady state throughput excluding ramp up during
commissioning phase

 

Joint Project Development Agreement with Mosaic

Further to the outstanding financial results of the EA, Rainbow and Mosaic
have signed a Joint Project Development Agreement to move ahead and carry out
a Pre-Feasibility Study ("PFS") for Uberaba.

 

On completion of a positive PFS and a decision to proceed with a Definitive
Feasibility Study ("DFS"), Rainbow and Mosaic currently intend to establish a
joint venture with Mosaic holding 51% and Rainbow 49%, subject to negotiation
of final Heads of Terms.

 

Notes to the EA

The EA does not meet the standards for a scoping study under the JORC Code as
it is not based on a formally designated resource. The EA is based on grade
information relating to the phosphogypsum feedstock stream provided by Mosaic
incorporating sampling data from the existing operations. A head grade of
0.51% TREO is used in the EA. The EA assumes recovery of 57% based on test
work undertaken at Mosaic's laboratory facilities at the Uberaba site. The
capital and operating costs for the EA have been developed in-line with the
standards adopted for a scoping study under the JORC Code. Rainbow recognises
that the assumptions upon which the EA is based and therefore the key findings
of the EA may change as a result of the negotiation of the joint venture
agreement and shareholders agreement for JVCo with Mosaic. The EA contains
confidential information relating to both Rainbow and Mosaic and will not be
published as a standalone study.

 

This release includes forward-looking statements. Such statements may include,
but are not limited to, statements regarding the development of the Uberaba
rare earths project; the expected scope, timing and results of the PFS and any
subsequent DFS; the potential formation, structure or ownership of a jointly
owned project company; targeted completion of Uberaba processing facility,
anticipated project economics, including expected internal rate of return and
payback period, production outlook, and the expected benefits of applying
proprietary technology to phosophogypsum, including potential processing
volumes and REE recovery. Such statements are based upon the current beliefs
and expectations of the Company's management and are subject to significant
risks and uncertainties. These risks and uncertainties include, but are not
limited to, the results of future studies, the performance of new
technologies, changes in market conditions for rare earths, the ability to
negotiate and execute definitive agreements, construction and execution risks,
the timing needed to complete any of the foregoing, and other risks and
uncertainties described in announcements issued by the Company. Actual results
may differ from those set forth in the forward-looking statements. The Company
assumes no obligation to update any forward-looking statements.

 

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF
REGULATION 596/2014 AS AMENDED AND TRANSPOSED INTO UK LAW IN ACCORDANCE WITH
THE EUROPEAN UNION (WITHDRAWAL) ACT 2018 ("UK MAR").

 

For further information, please contact:

 

 Rainbow Rare Earths Ltd   Company  George Bennett         +27 (0) 82 652 8526

                                    Pete Gardner
                           IR       Cathy Malins           +44 (0) 7876 796 629

                                                           cathym@rainbowrareearths.com
 Tavistock Communications  PR/IR    Charles Vivian         +44 (0) 20 7920 3150

                                    Eliza Logan            rainbowrareearths@tavistock.co.uk
 Berenberg                 Broker   Matthew Armitt         +44 (0) 20 3207 7800

                                    Jennifer Lee

 Stifel                    Broker   Ashton Clanfield       +44 (0) 20 7710 7600

                                    Varun Talwar

 

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
pioneering the first commercial recovery of rare earth elements from
phosphogypsum that occurs as the by-product of phosphoric acid production.
These projects eliminate the cost and risk of typical rare earth projects,
which involve mining and the production of a rare earth concentrate that must
be chemically cracked to form a mixed rare earth carbonate before further
downstream processing. As such, Rainbow's projects can be brought into
production quicker and at a lower cost than traditional hard rock mining
projects.

The Company is focused on the development of the Phalaborwa Project in South
Africa and the earlier stage Uberaba Project in Brazil. Rainbow's process will
deliver separated rare earth oxides through a single hydrometallurgical plant
on site, with a focus on the recovery of neodymium, praseodymium, dysprosium
and terbium. These are critical components of the high-performance permanent
magnets used in electric vehicles, wind turbines, defence and exciting new
markets such as robotics and advanced air mobility.

The Phalaborwa updated interim economic study released in December 2024 has
confirmed strong base line economics for the project, which has a base case
NPV(10) of US$611 million. Given Phalaborwa is a chemical processing
operation, with its resource sitting at surface in a chemically cracked form,
it has a much lower operating cost than traditional rare earth mining
projects, and it is therefore estimated to be one of the highest margin rare
earth projects in development today.

More information is available at www.rainbowrareearths.com
(http://www.rainbowrareearths.com/) or by visiting the Rainbow Rare Earths
Curation Showcase at: Curation Connect - Rainbow Rare Earths Showcase
(https://app.curationconnect.com/company/Rainbow-Rare-Earths-90903?utm_source=media&utm_campaign=media&utm_id=media)
or https://app.curationconnect.com/company/Rainbow-Rare-Earths-90903
(https://app.curationconnect.com/company/Rainbow-Rare-Earths-90903)

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