Option TechMet pour investir 50 millions de dollars à Phalaborwa
8 Novembre 2023
Rainbow Rare Earths Limited
("Rainbow"Ou"la Société")
LSE : RBW
TechMet option to invest US$50 million materially de-risks Phalaborwa equity financing
· Critical metals champion TechMet Limited ("TechMet") granted option to invest US$50 million to take direct stake in the Phalaborwa project in South Africa
· TechMet's mission is to develop world-class projects across the critical minerals supply chain and counts the United States International Development Finance Corporation ("DFC") as a major backer
· TechMet's extensive due diligence process has confirmed Phalaborwa's potential to be one of the lowest cost producers of separated rare earth oxides in development, leading to economic resilience across all anticipated future pricing scenarios
Rainbow Rare Earths is pleased to announce that it has entered into an option agreement with TechMet (the "TechMet Option"), whereby TechMet has the right to invest US$50 million to fund a substantial part of the equity component required for the project financing for Rainbow's Phalaborwa project in South Africa.
Under the terms of the TechMet Option the US$50 million investment will, depending on final project economics, give TechMet between a 15% and 33% direct equity interest in the project, underpinning a valuation of the project equity at between US$151.5 million and US$333.3 million. Given the de-risking that the TechMet Option will bring to the overall funding requirement to develop Phalaborwa, Rainbow sees this as a significant validation of the robust economics of Phalaborwa.
The TechMet Option agreement follows a period of extensive due diligence, as required by its own internal processes and as part of its commitments to the DFC and other shareholders. TechMet's mandate is to identify world-class projects across the critical minerals space, which are operated according to high standards of environmental, social and governance criteria, as well as showing the potential for excellent economic returns.
The overall capital expenditure for the project set out in the Preliminary Economic Assessment released in October 2022 was US$295 million, which is expected to be financed predominantly via debt.
George Bennett, PDG de Rainbow, a commenté : "We are delighted with the confidence shown by our long-term strategic investor, TechMet, following their due diligence on Phalaborwa. We believe that the TechMet Option is a significant de-risking for the financing requirements. This validates the Company's focus on the development of rare earths from secondary sources, as well as supporting the Company's belief that Phalaborwa is a strong and unique project. We expect Phalaborwa to continue to attract funding, especially from US-sources of capital, due to the focus on the critical role of these rare earth metals in the technology-driven industrial and clean energy age."
Brian Menell, Chairman and CEO of TechMet, said: "Phalaborwa has the potential to become one of the most environmentally friendly and lowest-cost rare earth projects anywhere in the world. Thanks to Rainbow's proprietary separation technology, Phalaborwa provides a significant opportunity to fast-track production of the four most economically important rare earth elements which are essential for future supply chains for electric vehicles, wind turbines and other products vital to the energy transition and the global economy. TechMet, is excited to be able to continue to support this outstanding project, which will produce rare earths in the most responsible manner possible."
About the Phalaborwa project
The Phalaborwa project in South Africa represents an exciting, near-term production opportunity of all four of the permanent magnet rare earths required for the green energy transition. The operation will involve the processing of phosphogypsum stacks, which are the byproduct of historic phosphoric acid production on the site, which ceased in 2014. This resource sits at surface, thereby eliminating the cost and risk of traditional mining projects.
Rainbow will be using proprietary separation technology developed by, and in conjunction with, its partner K-Technologies, Inc., which will allow for the material to be processed into separated rare earth oxides of 99.95% purity. This separation technique replaces traditional solvent extraction technology, which uses toxic and flammable solvents and diluents and requires many different stages, thereby delivering a process that is safer and more environmentally responsible, as well as reduced capital and operating costs due to a simplified flowsheet.
The project also has exceptional sustainability related opportunities as it is founded on the principles of circularity. Rainbow will be taking a waste product (the existing phosphogypsum stacks), cleaning it and extracting value from it - both via the recovery of the rare earth elements and then via the sale of the benign gypsum that is produced as the by-product of the process. Rainbow's operations will see the clean-up of the legacy environmental issues, namely the acid water on site, and will fully deplete the gypsum stacks over time, thereby allowing for a full circle environmental rehabilitation of the site.
The Phalaborwa Preliminary Economic Assessment confirmed strong base line economics for the project, which has a base case NPV10 en millions de 627 USD , an average EBITDA operating margin of 75% and a payback period of < two years. Due to its comparatively low operating cost and high EBITDA margin, the project is expected to be highly cash generative across the rare earth pricing cycle.
TechMet Option - Key Terms
TechMet has been granted an option to invest US$50 million as part of the equity funding component for the Phalaborwa capital cost, which will see TechMet take a direct ownership stake at project level. The TechMet stake will be dependent on the net present value set out in the definitive feasibility study for the project. Based on the agreed formula, the equity stake will be within a range of 15-33%.
The TechMet Option is executable for three months following receipt of a credit approved term sheet for construction debt, which will define the total equity requirement for the project development.
As part of the TechMet Option agreement, Rainbow has also granted TechMet a put option to exchange the direct stake in the project for shares in the listed entity at the fair market value of the underlying Phalaborwa stake for a period of two years from the commercial completion of the Phalaborwa project, or at any time in the event of a change in control of Rainbow.
Pour plus d'informations, s'il vous plaît contacter:
Terres rares arc-en-ciel Ltée | Entreprise | George Bennett Pete Gardner | Tel: +27 (82)652 8526
|
| Cathy Malins (IR) | Tel: +44 (7876)796 629 | |
Berenberg | Broker | Matthieu Armitt Jennifer Lee Detlir Elezi
| + 44 (0) 20 3207 7800 |
Tavistock Communications | RP/IR | Charles Viviane Tara Vivian Neal | + 44 (0) 20 7920 3150 |
Notes aux rédacteurs:
À propos de l'arc-en-ciel :
Rainbow Rare Earths vise à être un précurseur dans la mise en place d’une chaîne d’approvisionnement indépendante et éthique des éléments de terres rares qui sont à l’origine de la transition énergétique verte. Elle y parvient avec succès grâce à l'identification et au développement de gisements secondaires de terres rares qui peuvent être mis en production plus rapidement et à moindre coût que les projets miniers traditionnels en roche dure, en mettant l'accent sur les éléments de terres rares à aimant permanent que sont le néodyme et le praséodyme, le dysprosium et terbium.
La Société se concentre sur le développement du Le projet Phalaborwa Rare Earths en Afrique du Sud et le projet Uberaba, à un stade précoce, au Brésil. Les deux projets impliquent la récupération de terres rares à partir d'empilements de phosphogypse qui constituent le sous-produit de la production d'acide phosphorique, la roche mère d'origine des deux gisements étant une carbonatite de roche dure. Rainbow entend utiliser une technique de séparation exclusive développée par et en collaboration avec son partenaire K-Technologies, Inc., qui simplifie le processus de production d'oxydes de terres rares séparés (par rapport à l'extraction par solvant traditionnelle), entraînant des avantages en termes de coûts et d'environnement.
L'évaluation économique préliminaire de Phalaborwa a confirmé de solides données économiques de base pour le projet, qui a une VAN de référence.10 en millions de 627 USD , une marge opérationnelle EBITDA moyenne de 75% et un délai d'amortissement < deux ans. Les opérations de l'usine pilote ont commencé en 2023, et le projet devrait atteindre la production commerciale en 2026, cinq ans seulement après le début des travaux sur le projet par Rainbow.
Plus d'informations sont disponibles sur www.rainbowrareearths.com.
About TechMet
TechMet Limited is a leading technology metals investment company with a portfolio of assets that responsibly produce, process, and recycle the metals that are critical to the global energy transition and the electric vehicle revolution. Current assets in the TechMet portfolio include lithium extraction from both brine and hard rock sources, nickel and cobalt hydroxide production from laterite ores, vanadium chemical production from industrial waste feedstocks, rare earth production and processing, tin and tungsten mining, lithium-ion battery recycling, and high-performance cathode manufacturing. TechMet's major shareholders include the U.S. International Development Finance Corporation (DFC) and the global energy and commodity group Mercuria.
Plus d'informations sont disponibles sur www.techmet.com.
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