Arafura Rare Earths (ARU) Diggers & Dealers Mining Forum 2025 summary

Rare earth sector dynamics and industry context

• Global rare earth supply faces major disruption due to China's export controls, causing shortages, trade tensions, and a 93% drop in US-bound rare earth magnet exports in May 2025.

• China controls up to 99% of heavy rare earths, with Western nations highly dependent on Chinese supply.

• US tariffs and China's export restrictions have intensified supply concerns, prompting Western government intervention and new pricing mechanisms.

• Demand for NdPr oxide is projected to double by 2035, driven by EVs, wind, and robotics, with a 22% CAGR in robotics.

• Nearly 60kt of additional NdPr oxide supply will be required by 2035 to meet global demand.

Project status, strategy, and competitive positioning

• The Nolans Project is construction-ready, fully permitted, and positioned as a non-China alternative, with all approvals, engineering, and site preparations complete.

• Located near key infrastructure, the project has a scalable ore body with a 38+ year mine life and a Mineral Resource of 56Mt at 2.6% TREO.

• Phase one targets 4,440 tpa NdPr oxide, supporting up to 4.5 million EVs, with phase two aiming to become a processing hub.

• Byproduct phosphoric acid production significantly lowers costs, placing the project in the first quartile of the cost curve.

• The strategy focuses on vertical integration from mine to oxide, differentiating from concentrate-only producers.

Project economics and funding

• Capex is US$1,226m, with after-tax NPV up to US$2,549m and average annual production of 4,440 tpa NdPr oxide.

• Over US$1 billion in debt and completion support is conditionally approved from nine international agencies and commercial lenders, with $1.5 billion total funding required.

• Nearly $430 million in completion support and contingency has been arranged to reduce risk for investors.

• Targeting 60% of equity funding from cornerstone investors, with advanced negotiations and recent commitments from NRFC and KFW.

• Secured binding offtake agreements with Hyundai, Kia, Siemens Gamesa, Traxys, and other major global manufacturers.