(March 16): Lynas Rare Earths Ltd has signed a binding letter of intent to supply the Pentagon with rare-earth oxides over a four year-period.
The arrangement is worth US$96 million and will cover heavy and light rare-earth products, the company said in a statement Monday. The letter “establishes a framework to finalise an agreement for the supply” of the critical minerals, used in everything from wind turbines and electric vehicle motors to advanced military applications, for national security and supply-chain resilience objectives.
The floor price for neodymium-praseodymium oxide will be US$110 per kilogramme, it said.
“Through this agreement, the US Defense Industrial Base will continue to have access to Light and Heavy Rare Earth oxides that are essential for modern manufacturing,” Lynas chief executive officer Amanda Lacaze said in the statement.
Lynas is one of only two major rare-earths miners outside China — which holds a near monopoly over the supply chain. It currently has a mine and processing plant in Western Australia and another facility in Malaysia.
The company has plans to develop a heavy rare earth processing facility at Seadrift in Texas, however, there is “significant uncertainty” as to whether construction will go ahead, Lynas said in the statement.
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The agreement comes just a week after Lynas signed an offtake agreement with Japan Australia Rare Earths BV, which negotiates on behalf of Japanese companies. That agreement was for at least 5,000 tonnes of neodymium-praseodymium oxide a year until 2038, at a price floor of US$110 a kilogramme.
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