Northern Minerals has been awarded $5.9 million as part of the Australian Government’s Critical Minerals Development Program. Management says the funding will go towards key work programs at its Browns Range rare earths project in Western Australia’s East Kimberley region, including resource definition drilling at its Wolverine deposit, advanced front-end engineering and design and early work activities.
Northern Minerals is thinking big on the back of being awarded $5.9m as part of the Australian Government’s Critical Minerals Development Program.
Management says the funding will go towards key initiatives at its Browns Range rare earths project in Western Australia’s East Kimberley region, including resource definition drilling at its Wolverine deposit, advanced front-end engineering and design and early work activities.
Northern is currently working on a definitive feasibility study (DFS) at Browns Range for the supply of 30,500 tonnes per annum of contained total rare earths oxide (TREO) in concentrate, in an initial eight-year mine life that will include producing 2800 tonnes of dysprosium and 420 tonnes of terbium.
The DFS is scheduled to be wrapped up in this year’s final quarter. A final investment decision is expected to then be made in the first quarter of next year in relation to a commercial-scale mining operation and beneficiation plant and also to be able to secure the necessary funding to fulfil its delivery of rare earths concentrate for its offtake agreement with Iluka Resources.
Last October, Iluka and Northern inked the first offtake deal for the former’s $1.2 billion Eneabba rare earths refinery. It was a play which could eventually help the mineral sands producer to up its stake in Northern to 19.9 per cent.
The agreement involves Northern supplying 30.5 million tonnes of rare earths concentrate from Browns Range, which would provide direct feed for the new refinery.
Northern Minerals executive chairman Nicholas Curtis said: “We understand that there were a significant number of applicants and for NTU to be awarded $5.9m of the Program re-enforces the strategic nature of our dysprosium and terbium heavy resource base and its role, along with our offtake partner Iluka Resources in fostering new supply chains for critical minerals that are essential to global electrification and the transition to a low carbon economy”.
Around the same time that it was inking its deal with Iluka, Northern tabled a 47 per cent increase to its mineral resource estimate at Wolverine after an independent review by mining consultancy group CSA Global. The resource stands at 6.44 million tonnes going 0.96 per cent TREO for 61,492 tonnes of contained TREO.
Management regards Wolverine as the jewel in the crown of its bigger Browns Range project, given its high concentration of heavy rare earths such as dysprosium and terbium – both crucial ingredients in the production of electric vehicles and wind turbines.
The company says it is preparing to start mining at Wolverine with the aim of providing a reliable alternative source of dysprosium and terbium to production sourced from China.
In late 2018, Northern started producing heavy rare earths carbonate as part of a three-year pilot study to determine the economic and short-term viability of a larger-scale operation at Browns Range. The work follows a 2015 feasibility assessment that indicated at full capacity, the project could deliver exceptional free cash flows of $176 million per year for more than 11 years of the project’s initial operating life, at a cost of $329 million.
Northern’s latest grant forms a slice of a $48.9 million program aimed at supporting Australian projects in an effort to boost to the local sector. It is a move popular with countries around the globe as they look to loosen China’s vice-like grip on the world’s rare earths supply market.
While the geopolitical ramifications of such financial largesse will be played out in the longer term, it is Northern’s followers who will singing today as Australian taxpayers put hands in pockets to fund the next wave of work – all without disturbing the share register.
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