Arafura Resources Limited (ASX: ARU) has signed a second Memorandum of Understanding (MoU) for the supply of rare earth products from its 100%-owned Nolans Neodymium-Praseodymium (NdPr) project in the Northern Territory.
The MoU allows for the long-term sale of NdPr oxide from Nolans where Arafura is planning to produce an average of 4,357 tonnes of NdPr oxide per annum for the 23-year operational life of the project.
The MoU is with Baotou Tianhe Magnetics Technology Co., Ltd, one of China’s leading manufacturers of Neodymium Iron Boron (NdFeB) permanent magnets with a production capacity of approximately 10,000 tonnes per annum from its facility in Baotou, Inner Mongolia.
Tianhe Magnetics has been operating for more than 30 years, and has sales offices in Europe, the USA, Japan, South Korea and across China. Its customer base includes several globally recognised Western world companies that use magnets in EV/HEV motors, wind power generators, consumer electronics, household appliances, medical devices, and aerospace applications.
Arafura Managing Director Gavin Lockyer said the provisions outlined in the MoU provide a framework for negotiating a final offtake agreement for the sale of up to 900 tonnes per annum of NdPr oxide.
The MoU also contemplates Tianhe Magnetics working with Arafura to develop further opportunities for long-term offtake of NdPr oxide or metal with third party end users.