Australian miner Arafura Rare Earths on Thursday announced a binding offtake agreement with Traxys Europe for the supply of neodymium-praseodymium (NdPr) oxide from its Nolans project in Northern Territory, further advancing its efforts to secure long-term sales agreements.

Under the five-year deal, Arafura will supply a minimum of 100 t/y of NdPr oxide, with an option to increase volumes up to 300 t/y at its discretion. 

The contract is subject to conditions precedent, including the completion of Nolans' construction and development, as well as the start of commercial production and ramp-up by December 31, 2028.

“This agreement with Traxys moves us closer to achieving our offtake target of 80%,” said Arafura MD Darryl Cuzzubbo. “With only 34% of the product from Nolans remaining to be marketed, our ongoing negotiations mean we are well-positioned to reach this target.”

The deal adds to Arafura’s existing offtake agreements with Hyundai Motor and Kia, as well as Siemens Gamesa Renewable Energy, bringing total secured commitments to 66% of its target. The company continues to negotiate additional agreements with customers in Asia, Europe, and North America.

Traxys, a Luxembourg-based trading and marketing firm specialising in metals and minerals, aims to use NdPr from Nolans to support global supply chain diversification and resilience. “The Nolans deposit is an attractive Western source of NdPr, and we are looking forward to this exciting opportunity,” said Gregoire de Beco, VP of Noble Alloys and Rare Earths at Traxys.

NdPr oxide is a key ingredient in the production of high-performance magnets used in electric vehicles, wind turbines, and other clean energy technologies. Arafura’s offtake strategy has focused on securing agreements with original-equipment manufacturers from jurisdictions with supportive export credit agencies.

Pricing for the offtake is contractually based on the NdPr Ex Works China price and will be settled in US dollars. During the production ramp-up phase, volumes will be allocated on a pro-rata basis.

Arafura is targeting a yearly production capacity of 4 440 t of NdPr oxide from Nolans. The project is expected to contribute to the global rare earths supply chain from a Tier 1 jurisdiction, aligning with international efforts to reduce reliance on China for critical minerals.