Alkane to process Dubbo rare earth concentrate offsite

PERTH (miningweekly.com) – ASX-listed Alkane Resources has signed a letter of intent (LOI) with material company Vietnam Rare Earth JSC (VTRE) to toll process rare-earth concentrate from the Dubbo zirconia project, in New South Wales, into individual rare-earth products.

Subject to the completion of a due diligence, VTRE would toll process a rare-earth concentrate from the Dubbo project to produce separated rare-earth oxides to agreed customer specifications.

Alkane said on Thursday that up to 6 664 t/y of separated rare earths could be produced from the Dubbo project. Initially, however, only 2 000 t/y of the key, high-value rare earths would be shipped to VTRE for processing, with lanthanum, cerium and yttrium to be recovered from Dubbo.

The yttrium oxide would be sold directly from the Dubbo project while the separated lanthanum and cerium would be stored until the market improved.

The toll agreement was expected to run until the end of 2027, with Alkane holding an option to extend the agreement.

The company told shareholders on Thursday that the agreement with VTRE gave Alkane the opportunity to participate in downstream integrated rare earths processing without the cost of building, commissioning and operating an on-site facility.

“The use of an off-site toll processing facility was already identified in the company’s existing plans and business case, as it minimises potential future technical, process and market risks for the Dubbo project, and subsequent financial risk,” Alkane said.

VTRE would also toll process separated rare-earth oxides into value-added products, including rare earth metal alloys to meet customer specifications.

Meanwhile, Alkane and VTRE would also form a joint marketing company to promote and develop current and new applications for VTRE’s products. The marketing company would leverage Alkane’s existing international business development processes and support VTRE to expand its exposure to non-Asian markets.

Alkane said that the joint marketing would also enable the company to undertake value-added product development and start servicing customers prior to production starting at Dubbo.

The A$1.3-billion Dubbo project was expected to extract 19.5-million tonnes of rare metals and rare-earth ores from an opencut mine, at a rate of one-million tonnes a year.