Name of the Project
Phalaborwa Rare Earths Project.

Location
Limpopo, South Africa.

Project Owner/s
London-listed Rainbow Rare Earths (85%).

Rainbow Rare Earths signed an agreement with phosphate mining company Bosveld Phosphates in June 2023 to ensure it obtains 100% ownership of the Phalaborwa project. 

Upon completion of a definitive feasibility study (DFS), the unincorporated joint venture (JV) will be transferred into an incorporated JV company and, at Rainbow’s election, Bosveld will transfer all assets required for the project into that company. 

Project Description
An interim economic study released in December 2024 proposed a project life of 16 years – two years longer than the one envisaged in the October 2022 preliminary economic assessment (PEA) – processing an average of 2.2-million tonnes of phosphogypsum a year.

The overall recovery rate of magnet rare-earth elements remains the same as that of the PEA, at 65%, based on the pilot campaign undertaken from 2023 to 2024, with about 1 900 t/y magnet rare earth oxide (REO) production.

The interim economic study represents a much higher level of confidence in the processing flowsheet prior to separation, and capital and operating cost estimates, than those of the PEA.

In addition to confirming the robust economics of Phalaborwa, the interim economic study has highlighted several areas for further operating and capital cost optimisation, which will be done in parallel with the ongoing rare earth separation testwork.

Potential Job Creation
Not disclosed in the interim study.

Net Present Value/Internal Rate of Return
When calculated on the same basis as the October 2022 PEA, the interim economic study delivers an after-tax net present value (NPV), at a 10% discount rate, of $611-million, in line with the comparable PEA NPV of $627-million.

Capital Expenditure
The interim economic study provides an updated, upfront capital cost of $326.1-million, which is lower than the PEA capital cost of $295.5-million, adjusted for inflation.

Planned Start/End Date
Production is expected to start in 2026.

Latest Developments
Rainbow has indicated in its preliminary results for the year ended June 30, that it has received strong support for the Phalaborwa project from the US International Development Finance Corporation (DFC), which is an indirect shareholder through TechMet, and which has committed $50-million in project equity funding.

The company has also secured the support of Ecora Resources, which has chosen Phalaborwa as its first royalty in the REE space.

As a chemical processing operation, with no mining, hauling or stockpiling required, Rainbow has stated that Phalaborwa is positioned at the lowest end of the global industry cost curve and is expected to be one of the highest-margin projects in development at present.

The company has further indicated "excellent technical progress" regarding the production of a high-purity, mixed rare earth product (MREP), which significantly exceeds average industry standards.

An evaluation is under way to define the optimal route to separation, with the final products expected to be a separated neodymium and praseodymium oxide and SEG+, a basket of medium and heavy rare-earth products.

Rainbow will now run a pilot-scale plant to validate the updated primary flowsheet parameters, as well as incorporate and demonstrate the expected capital and operating cost savings from ongoing trade-off studies.

Phalaborwa’s definitive feasibility study (DFS) is expected to be finalised in 2026 and, upon its completion, finalisation of the permitting process will run in parallel with the project finance process, which is expected to lead to the start of construction in 2027.

Key Contracts, Suppliers and Consultants
ANSTO Minerals (plant processing testwork); K-Tech Inc (REO separation technology and partner in developing plant processing flowsheet, managing the back-end of the pilot plant at its US facility); Mintek (managing plant front-end in South Africa); and METC Engineering (production of the PEA and engineering work for the DFS).

Contact Details for Project Information
Tavistock Communications, on behalf of Rainbow Rare Earths, tel +44 20 7920 3150 or email rainbowrareearths@tavistock.co.uk.