ASX-listed explorers are scouring right across Brazil in search of high value REE deposits
Brazil contains the third-largest REE reserves on the planet
It’s also home to the world’s newest ionic clay-hosted REE producing project, Serra Verde
They say to make hay while the sun shines, and explorers in the emerging rare earths (REE) mining scene in Brazil are doing just that, as many other commodities experience depressed market prices or supply gluts.
REE demand is high, getting higher, and forecast to be prolonged as outside China markets look to create new supply chains for the 17 elements that make up rare earths.
All are required in some way shape or form, however, it’s the high-value magnetic rare earth oxides (MREO) of neodymium (Nd), praseodymium (Pr), dysprosium (Dy) and terbium (Tb) that OEMs such as carmakers, semiconductor and chip manufacturers and other high tech industries need more of.
Brazil has the third largest reserves of rare earths in the world according to the US Geological Survey (USGS), with 21 million tonnes (Mt).
The latest USGS report pegs China in first place with 44Mt, followed by Vietnam (22Mt) and Russia (also in third with 21Mt).
Even with that endowment, Brazil’s REE output is currently just a fraction of its overall potential, shipping out just 80t of REEs in 2022 – a drop in the ocean compared to the 300,000t produced globally.
Brazil’s National Mining Agency says mineral research requests skyrocketed in 2022, up about 70% from 2021 to 155 – most of them hunting for REE deposits in the Goias, Minas Gerais and Bahia States.
Speaking with *in January, Alvo Minerals managing director Rob Smakman said Brazil was fast emerging as the most important REE jurisdiction globally.
Bordering Goias State in Toncantin State, ALV is proving up its flagship Bluebush rare earths project, where neighbour Serra Verde recently became the only IAC-type REE producer outside China.
With a 911Mt @ 1,200ppm TREO resource and mineral reserves of 350Mt @ 1,500ppm, Serra Verde is expected to be in production for >20 years, with an expected run rate of >5,000tpa of high-value MREO (NdPr, DyTb).
“From our perspective, being adjacent to Serra Verde is important for us because we’re hosted on the same granite,” Smakman says.
Canadian explorer Aclara Resources is nearby too, having just secured full ownership of its $US1.2bn Carina Module IAC project which is pegged to produce 208tpa of DyTb and 1,190tpa NdPr over a 17-year mine life.
Meanwhile, early doors REE explorer Appia recently reported an astonishing 24m-thick intersection at its PCH project from surface down drill hole PCH-RC-063, with a whopping 38,655ppm average, including 92,758ppm between 10–12m – which is gangbusters by all stretches of the imagination.
Interestingly, ALV’s recently secured Ipora REE project is right next door.
Bahia’s hard rock and IAC potential
Moving up to Bahia State in Brazil’s northeast, Australia’s richest person Gina Rinehart is backing Brazilian Rare Earths which has a project portfolio covering almost the entire Rocha da Rocha rare earths province.
Exploration has identified hard rock monazite sand-type geology across the Monte Alto, Velhinhas, Sulista and Pelé projects, indicating the potential for ultra-high grade REE-niobium-scandium mineralisation at depth.
Australian Mines’ Jequie project is also in the neighbourhood and adjacent to the 510Mt Rocha de Rocha.
Also in Rocha da Rocha is Gold Mountain which has just secured the Ronaldhino project – an additional 41 tenements across 800km2 that complement its +900km2 Down Under project – both adjacent to BRE’s landholdings.
It’s joined by Equinox Resources, which has pegged a huge area in the emerging rare earths district for its Campo Grande IAC project and has reported surface sample grades of up to 2,282ppm TREO from initial augur drilling.
Minas Gerais’ meteoric REE rise
Another market darling for ionic REE deposits is Meteoric Resources with its 409Mt @ 2,626ppm Caldeira project, recently engaged ANSTO for some metallurgical work and produced 98% purity mixed rare earths carbonate (MREC) from acid-leached samples.
Last month MEI received interest from the US Export-Import Bank for a debt funding package worth US$250m – another sign that the US government is putting its money where its mouth is to secure critical minerals supply chains.
Right next door and having only just acquired its 91km2 Colossus IAC REE project in August last year, Viridis Mining and Minerals has expanded the project to a dominant 239km2 landholding and intersected significant high-grade zones of TREO of up to 24,894ppm.
Testing by ANSTO on samples taken from the first diamond hole at the Cupim South prospect recently returned 80% NdPr and 66% DyTb recoveries across the entire intersection and confirmed its IAC credentials.
The explorer recently inked a deal with Ionic Rare Earths to introduce REE separation tech that can be applied to capture all 17 rare earths during the refinement process.
“We are looking to capitalise on our first mover advantage with this mature downstream technology and support the current discussions being held with the burgeoning supply chain that’s developing in Brazil,” VMM CEO Rafael Moreno says.
REE Survival Guide Part 4
Australian rare earth deposits are looking to feed into refineries that will be popping up over the next few years
Chinese companies are securing offtake from near-term producers
This leaves juniors in pole position to fill a gap in the market
“Like sands through the hourglass” – these are the days of our bottlenecked rare earths refinement capabilities. Currently, there are only two operating rare earths (REE) refineries in the world’s supply chain outside China and the rest of the world is struggling to squeeze through enough supply.
That’s changing, and it’s the how it’s changing that could just resonate for ASX juniors – especially those with projects in Australia.
Refinement issues
China refines a game-watering 87% of the world’s REEs, and other countries are looking to diversify their supply chains as well as bring online new refineries themselves.
Currently, only Canada’s Neo Performance Materials (NPM), running the Silmet refinery in Estonia, and Australia’s Lynas Malaysian facility are in operation outside the Middle Kingdom.
NPM is still looking for REE feedstock and, according to Wood Mackenzie, is exploring several potential sources – including Australia.
Australia itself is looking to set itself up as a major producer and refiner of REEs too.
In its attempt to open Australia’s first downstream REE refining account, Iluka Resources is constructing its $1.7bn Eneabba refinery in WA’s Mid West, with production pegged for 2026.
Leading the pack to become Australia’s next REE mine and feed into Eneabba once it’s online is Hastings Technology Metals, which is advancing towards the construction of its Yangibana deposit in WA’s Gascoyne.
Yet that almost seems counter-intuitive, as governments across the world are scrambling to form ex-China downstream supply chains.
How they, or private Western downstream companies in the space have not looked to secure offtake agreements from such an advanced-stage project should be questioned.
The silver lining is, it just leaves another gap wide open for budding REE explorers to take advantage of.
Pollution has hindered progress
There are pollution concerns with the current refining processing of REEs.
As governments keep pushing net-zero targets, companies are geared towards looking for more innovative, cheaper and cleaner ways to produce the materials.
Current solvent extraction methods used by refiners translate to high levels of emissions and waste, yet new tech is coming onto the scene that could open more doors.
One budding refiner, Canadian-listed Ucore Rare Metals, aims to process rare earths by mid-2025 using its RapidSX tech, which it reckons is three times faster than solvent extraction, doesn’t produce hazardous waste and requires just a third of the space.
“Our goal is to re-establish a North American rare earths supply chain,” Ucore COO Michael Schrider told Reuters.
There’s also South Africa’s Rainbow Rare Earths which has partnered with US-based K-Technologies to use a new continuous ion exchange tech that’s already used by some lithium producers.
A little bit lost in the world of rare earths? We’ve got your back. Check out Parts 1-3 of our REE Survival Guide here:
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