The company is also looking at a joint venture with OCI Company Ltd. to build a separation plant in South Korea.
According to Arafura the Nolans Bore rare earths-phosphate deposit is "one of the largest and most intensively explored deposits of its kind in the world." The deposit contains a JORC-compliant mineral resource of 56 million tonnes at an average grade of 2.6% TREO that extends to 215 metres below the surface. Two-thirds of the contained rare earths are in the measured and indicated category.
Arafura estimates the project would create an investment of about $900 million in Central Australia, as well as 250 to 300 permanent jobs.
An environmental approval from the Australian government and a final approval from the state government still need to be obtained.
The mine could supply up to 10% of world demand for neodymium and praseodymium, used in the manufacture of magnets for wind turbines, and electric vehicles.
Rare earth metals represent vital parts of the evolving technology sector and not least for renewable energy, batteries, defence and computing. Since China dominates the sector and has already demonstrated it is willing to use its position as both a geopolitical and economic tool, there are solid arguments for developing more varied sources of supply.
Lynas Corp broke out to new recovery highs in the first few days of the year and some consolidation is now underway.
However, a sustained move below the trend mean would be required to question medium-term scope for continued upside.
Alkane Resources is using revenues from its gold mine to fund development of a heavy rare earth metals mine in New South Wales. The share has been ranging since July and is currently bouncing from the lower boundary.
Arafura Resources appears to be forming a first step above its four-year base and is currently bouncing from the upper side of that congestion area.