Ionic eager to start building Makuutu rare earths project amid China’s latest restrictions
ASX-listed Ionic Rare Earths says it is advancing discussions on the development of its Makuutu rare earths project, in Uganda, as China’s latest rare earth export restrictions increase focus on the necessity of a Western supply chain.
China on April 4 announced new export restrictions on medium and heavy rare earths, including dysprosium, gadolinium, lutetium, samarium, scandium, terbium and yttrium-related items.
These add to previous export controls on antimony, gallium and germanium and the technology used to make rare earth magnets.
The country is curbing the export of certain rare earths as part of its retaliation to the US’s aggressive trade tariffs imposed since early April, which means China will practice greater scrutiny over its shipments to international buyers.
China produces about 90% of the world’s rare earths, and about 98% of the world’s medium and heavy rare earths, according to Ionic. The company says China’s latest export curbs further increase Beijing’s dominance over metals key to clean energy, defence and advanced manufacturing.
Currently, there is only one heavy rare earth element operation located outside of China, in Brazil, which exports mixed rare earth carbonate to south-east Asia for processing within the Chinese supply chain.
While China has excluded neodymium and praseodymium from this export restriction, Ionic says the move has nonetheless increased focus on new supply sources of rare earths. Makuutu is an advanced ionic adsorption clay project, with no product committed to China.
Makuutu’s product basket boasts among the highest heavy rare earth content identified to date, being about 45% medium and heavy rare earths, and offers the potential for the long-term supply of magnet and heavy rare earth oxides.
Ionic is advancing financing discussions with members of the Mineral Security Partnership (MSP) and potential offtakers to speed up development of the shovel-ready project.
The MSP, which is an international initiative led by the US, aims to accelerate the development of diverse and sustainable critical energy minerals supply chains through working with host governments and industry to facilitate targeted financial and diplomatic support for strategic projects along the value chain
The Makuutu deposit comprises nine licences covering 300 m2.
Ionic secured a mining licence for the central Makuutu tenement in January last year, which represents the first large-scale mining licence issued in Uganda under the country’s 2022 Mining Act.
The company started producing mixed rare earth carbonate in the first quarter of last year through a demonstration plant to strengthen engagement with offtakers and strategic partners.
Ionic owns 60% of Rwenzori Rare Metals, which owns 100% of the Makuutu project. The company is working to increase its ownership in the project to 94%.
Ionic MD Tim Harrison says Makuutu’s potential is clear, given that more than 95% of the world’s supply of heavy rare earth oxides stems from southern China and Myanmar.
“The clays of Makuutu present a low capital mining, extraction and processing opportunity and are the most readily available global sources of heavy rare earth oxides,” he adds.
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