11 September 2024
Rainbow Rare Earths Limited
("Rainbow" or "the Company")
LSE: RBW
Updated JORC-compliant Mineral Resource Estimate ("MRE") for Phalaborwa
· Updated MRE confirms a 15% increase in the overall size of the Phalaborwa Resource, adding an additional two years to the project life.
· Total Measured, Indicated and Inferred Resource of 35.0 Mt at 0.44% TREO, with a near doubling in the material now classified as Measured.
· The light rare earth elements ("REEs") neodymium ("Nd") and praseodymium ("Pd") represent 29% and the heavy REEs dysprosium ("Dy") and terbium ("Tb") represent 1% and 0.3% respectively - all four of these REEs are considered critical minerals essential to the green energy transition.
· The MRE now reports the full range of recoverable REEs that may have economic value for Rainbow in the future, being the SEG group (samarium, europium and gadolinium), lanthanum ("La") and cerium ("Ce").
· At spot pricing, including Nd/Pr at ca. US$62.5/kg[1], the MRE has an in-situ metal oxide value of ca. US$3.7 billion REEs, with considerable upside based on the forecast strong demand outlook for permanent magnet REEs.
NEWS RELEASE
Further to the Resource Update released on 26 February 2024, today's announcement reflects the publication of a new MRE for Phalaborwa prepared in accordance with the guidelines of the JORC Code (2012 Edition) ("JORC"). The full MRE can be accessed at https://www.rainbowrareearths.com/project/phalaborwa/.
As indicated in the February announcement, the application of updated bulk density estimates and additional drilling for the Phalaborwa phosphogypsum stacks has led to an increase in the Resource by 15% from 30.4 Mt to 35.0 Mt, reported at a 0.2% TREO cut-off grade. At projected production rates, this has extended the project life from 14 years to 16 years.
George Bennett, CEO of Rainbow, commented: "The publication of an updated JORC-compliant Resource for Phalaborwa reaffirms the huge value intrinsic to this project, which contains economic quantities of all four of the critical magnet REEs. It also points to the potential for value from other recoverable REEs, which are currently not included in our project economics, and the MRE has an in-situ metal oxide value of ca. US$3.7 billion even at today's lower spot prices. It's worth noting that this is a very different type of Resource to that of a hard rock mining project, sitting at surface with a relatively homogenous distribution in the phosphogypsum stacks. Therefore, we intend to process the entirety of the stacks, allowing us to generate value from the full 35 Mt Resource."
The four most economically important REEs, being Nd, Pr, Dy and Tb, together represent over 30% of the basket by volume at Phalaborwa and 96% by value. These REEs have been designated globally as critical minerals for the green energy transition due to their use in the permanent magnets essential for electric vehicles and wind turbines. Furthermore, they are considered to be among those critical minerals most at risk in terms of supply chain vulnerabilities.
For the first time, the MRE now includes the full range of recoverable REEs that may have economic value for Rainbow in the future, being the SEG group, La and Ce. At spot prices, the MRE including these ancillary REEs has an in-situ metal oxide value of ca. US$3.7 billion. We have also confirmed that the process residue gypsum is a saleable product, allowing Rainbow to realise further value from the Resource.
The updated MRE confirms very low levels of radioactive elements, further attesting to the 'green' credentials of this project, which will recover REEs from a waste product and rehabilitate an industrial site over time. Uranium is estimated at 1.8 ppm and thorium is estimated at 48ppm, at which levels they can be considered trace elements.
Measured, Indicated and Inferred Mineral Resource Estimate
The MRE is located in two adjacent historically processed phosphogypsum stacks (termed Stack A and Stack B) on the Phalaborwa project site. The MRE update was completed in July 2024 and is based on additional drilling and sampling completed during 2023. Samples were initially sent to Ardaman and Associates, Inc., a Tetra Tech Company ("Ardaman"), in the USA for bulk density calculations before being shipped back to SGS in South Africa for grade assays.
Notes:
1. TREO = Total Rare Earth Oxide; ppm = parts per million
2. Resource figures are reported gross; Rainbow owns an 85% interest in the Phalaborwa project, with an option to increase ownership to 100%
3. The Mineral Resource is reported at a nominal 0.2% TREO cut-off grade
4. No constraining shell is required as stacks are above ground level and no selective reclamation is required
5. Mineral resources are not mineral reserves and do not have demonstrated economic viability
6. The 'Total' rows do not always tally due to rounding
7. The full Resource tables are set out in the Appendix
The MRE is classified as Measured, Indicated and Inferred Mineral Resources of 46%, 43% and 11% deposit tonnage respectively (July 2023 Resource: Measured, Indicated and Inferred Mineral Resources of 24%, 53% and 23% deposit tonnage respectively), representing increased confidence as a result of recent infill drilling.
The MRE is noted as being relatively homogenous in nature, with no selective reclamation of the stacks required as 99.7% of the phosphogypsum tonnage is above the 0.2% TREO cut-off. Due to the nature of the Resource sitting at surface and the associated water limiting drill accessibility, Rainbow is not planning to do further infill drilling and the Inferred portion will be included in the project's forthcoming Definitive Feasibility Study. It is anticipated that the full Resource will be processed as part of the project life.
Competent Persons Statement
The information in this report that relates to the Mineral Resources for the Phalaborwa project is based on, and fairly represents, information compiled or reviewed by Mr Malcolm Titley, a Competent Person who is a Member of the Australasian Institute of Mining and Metallurgy and the Australian Institute of Geoscientists. Mr Titley is employed by Maja Mining Limited, an independent consulting company.
Mr Titley has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Mr Titley consents to the inclusion of information from this report in Rainbow public releases using his information in the form and context in which it appears.
For further information, please contact:
| Rainbow Rare Earths Ltd | Company | George Bennett Pete Gardner | +27 82 652 8526
|
|
| IR | Cathy Malins | +44 7876 796 629 |
| Berenberg | Broker | Matthew Armitt Jennifer Lee
| +44 (0) 20 3207 7800 |
| Stifel
| Broker | Ashton Clanfield Varun Talwar
| +44 20 7710 7600 |
| Tavistock Communications | PR/IR | Charles Vivian Tara Vivian-Neal | +44 (0) 20 7920 3150 |
Notes to Editors:
About Rainbow:
Rainbow Rare Earths aims to be a forerunner in the establishment of an independent and ethical supply chain of the rare earth elements that are driving the green energy transition. It is doing this successfully via the identification and development of secondary rare earth deposits that can be brought into production quicker and at a lower cost than traditional hard rock mining projects, with a focus on the permanent magnet rare earth elements neodymium and praseodymium, dysprosium and terbium.
The Company is focused on the development of the Phalaborwa Rare Earths Project in South Africa and the earlier stage Uberaba Project in Brazil. Both projects entail the recovery of rare earths from phosphogypsum that occurs as the by-product of phosphoric acid production, with the original source rock for both deposits being a hardrock carbonatite.
The Phalaborwa Preliminary Economic Assessment has confirmed strong base line economics for the project, which has a base case NPV10 of US$627 million, an average EBITDA operating margin of 75% and a payback period of < two years.
More information is available at www.rainbowrareearths.com.
Appendix
MRE - REE Proportions
| JORC 2012 | Stack | Mt | TREO % | Nd | Pr | NdPr | Dy | Tb | Eu | Sm | Gd | La | Ce | LREO | HREO | SEGO | Ga | F | Th | U | Dry BD | Moisture |
| Measured | Stack A | 10.8 | 0.4 | 23.6 | 5.7 | 29.3 | 1.0 | 0.3 | 0.8 | 4.0 | 3.0 | 17.4 | 41.6 | 92.2 | 5.5 | 7.8 | 10 | 0.8 | 48.6 | 1.7 | 1.37 | 25 |
| | Stack B | 5.2 | 0.5 | 23.3 | 5.9 | 29.1 | 0.9 | 0.3 | 0.8 | 3.9 | 2.9 | 17.4 | 42.2 | 92.5 | 5.4 | 7.6 | 9 | 0.7 | 45.0 | 2.1 | 1.33 | 27 |
| | Total | 16.0 | 0.5 | 23.5 | 5.7 | 29.2 | 1.0 | 0.3 | 0.8 | 4.0 | 3.0 | 17.4 | 41.8 | 92.3 | 5.4 | 7.7 | 10 | 0.7 | 47.4 | 1.8 | 1.36 | 26 |
| Indicated | Stack A | 11.0 | 0.4 | 23.3 | 5.5 | 28.8 | 1.0 | 0.3 | 0.8 | 3.9 | 2.9 | 17.2 | 42.2 | 92.2 | 5.4 | 7.6 | 11 | 0.6 | 47.7 | 1.8 | 1.46 | 22 |
| | Stack B | 3.9 | 0.5 | 23.2 | 5.7 | 28.8 | 1.0 | 0.3 | 0.8 | 3.9 | 2.8 | 17.6 | 42.4 | 92.7 | 5.2 | 7.5 | 10 | 0.7 | 42.9 | 2.0 | 1.31 | 27 |
| | Rubble/ Mixed | 0.4 | 0.3 | 25.3 | 5.4 | 30.7 | 1.0 | 0.3 | 0.8 | 4.5 | 2.8 | 16.4 | 40.5 | 92.2 | 5.3 | 8.1 | 6 | 1.3 | 28.5 | 1.9 | 1.42 | 27 |
| | Total | 15.2 | 0.4 | 23.3 | 5.6 | 28.9 | 1.0 | 0.3 | 0.8 | 3.9 | 2.9 | 17.3 | 42.2 | 92.3 | 5.4 | 7.6 | 11 | 0.7 | 46.0 | 1.9 | 1.42 | 24 |
| Inferred | Stack A | 1.7 | 0.4 | 23.4 | 5.5 | 28.9 | 1.0 | 0.3 | 0.8 | 3.9 | 2.8 | 17.0 | 42.5 | 92.3 | 5.3 | 7.5 | 9 | 0.6 | 46.0 | 2.1 | 1.48 | 21 |
| | Stack B | 1.6 | 0.4 | 23.2 | 5.5 | 28.7 | 1.0 | 0.3 | 0.8 | 4.0 | 2.8 | 17.7 | 42.1 | 92.5 | 5.3 | 7.7 | 11 | 0.7 | 40.2 | 2.0 | 1.33 | 27 |
| | Rubble/ Mixed | 0.6 | 0.3 | 24.3 | 5.8 | 30.1 | 0.9 | 0.3 | 0.8 | 4.6 | 2.7 | 17.3 | 40.5 | 92.5 | 5.2 | 8.2 | 5 | 1.1 | 31.1 | 1.5 | 1.42 | 25 |
| | Total | 3.8 | 0.4 | 23.4 | 5.6 | 29.0 | 1.0 | 0.3 | 0.8 | 4.0 | 2.8 | 17.3 | 42.1 | 92.4 | 5.3 | 7.7 | 9 | 0.7 | 41.4 | 2.0 | 1.40 | 24 |
| Grand Total |
| 35.0 | 0.4 | 23.4 | 5.6 | 29.0 | 1.0 | 0.3 | 0.8 | 4.0 | 2.9 | 17.3 | 42.0 | 92.3 | 5.4 | 7.7 | 10 | 0.7 | 46.1 | 1.8 | 1.39 | 25 |
Notes
1. TREO = Total Rare Earth Oxide, HREO = Heavy Rare Earth Oxide, LREO = Light Rare Earth Oxide, SEGO = SEG Oxide
2. The Mineral Resource is reported at a 0.2% TREO cut-off grade
3. The individual REEs set out in the table refer to the following oxides, set out as % proportions of TREO; Nd2O3, Pr6O11, Dy2O3, Tb4O7, Eu2O3, Sm2O3, Gd2O3, La2O3, Ce2O3, Ce2O3
4. NdPr, LREO, HREO and SEGO are set out as % proportions of TREO
5. Ga, Th, U are shown as parts per million (ppm), F is shown as %
6. Moisture content is set out as %
7. No constraining shell is required as stacks are above ground level
8. Adequate initial metallurgical testwork and financial analysis has been completed to satisfy reasonable prospects for economic evaluation
9. The favoured mineral processing route uses a continuous ion exchange (to remove impurities) followed by REE leach and REE refining to produce three saleable products: neodymium/praseodymium oxide, dysprosium oxide, and terbium oxide; all processing is expected to be on-site at the Phalaborwa Mining Complex adjacent to the phosphogypsum stacks
10. Tonnages are rounded to the nearest 100,000 tonnes to reflect this as an estimate
MRE - REE Grades
| JORC 2012 | Stack | Mt | TREO % | LREO % | HREO % | SEGO % | F % | Th ppm | U ppm | Nd2O3 % | Pr6O11 % | Dy2O3 % | Tb4O7 % | Sm2O3 % | Eu2O3 % | Gd2O3 % | La2O3 % | Ce2O3 % | Dry BD | Moisture |
| Measured | Stack A | 10.8 | 0.44 | 0.41 | 0.02 | 0.03 | 0.8 | 49 | 1.7 | 0.104 | 0.025 | 0.004 | 0.001 | 0.018 | 0.004 | 0.013 | 0.077 | 0.184 | 1.37 | 25 |
| | Stack B | 5.2 | 0.47 | 0.43 | 0.02 | 0.04 | 0.7 | 45 | 2.1 | 0.109 | 0.028 | 0.004 | 0.002 | 0.018 | 0.004 | 0.014 | 0.081 | 0.198 | 1.33 | 27 |
| | Total | 16.0 | 0.45 | 0.42 | 0.02 | 0.03 | 0.7 | 47 | 1.8 | 0.106 | 0.026 | 0.004 | 0.001 | 0.018 | 0.004 | 0.013 | 0.078 | 0.188 | 1.36 | 26 |
| Indicated | Stack A | 11.0 | 0.42 | 0.39 | 0.02 | 0.03 | 0.6 | 48 | 1.8 | 0.098 | 0.023 | 0.004 | 0.001 | 0.016 | 0.003 | 0.012 | 0.072 | 0.177 | 1.46 | 22 |
| | Stack B | 3.9 | 0.46 | 0.42 | 0.02 | 0.03 | 0.7 | 43 | 2.0 | 0.106 | 0.026 | 0.004 | 0.001 | 0.018 | 0.004 | 0.013 | 0.080 | 0.193 | 1.31 | 27 |
| | Rubble/ Mixed | 0.4 | 0.30 | 0.28 | 0.02 | 0.02 | 1.3 | 29 | 1.9 | 0.075 | 0.016 | 0.003 | 0.001 | 0.013 | 0.002 | 0.008 | 0.050 | 0.123 | 1.42 | 27 |
| | Total | 15.2 | 0.43 | 0.39 | 0.02 | 0.03 | 0.7 | 46 | 1.9 | 0.099 | 0.024 | 0.004 | 0.001 | 0.017 | 0.003 | 0.012 | 0.074 | 0.180 | 1.42 | 24 |
| Inferred | Stack A | 1.7 | 0.41 | 0.38 | 0.02 | 0.03 | 0.6 | 46 | 2.1 | 0.097 | 0.023 | 0.004 | 0.001 | 0.016 | 0.003 | 0.012 | 0.071 | 0.176 | 1.48 | 21 |
| | Stack B | 1.6 | 0.44 | 0.41 | 0.02 | 0.03 | 0.7 | 40 | 2.0 | 0.103 | 0.025 | 0.004 | 0.001 | 0.018 | 0.004 | 0.013 | 0.079 | 0.188 | 1.33 | 27 |
| | Rubble/ Mixed | 0.6 | 0.31 | 0.28 | 0.02 | 0.02 | 1.1 | 31 | 1.5 | 0.074 | 0.018 | 0.003 | 0.001 | 0.014 | 0.003 | 0.008 | 0.053 | 0.125 | 1.42 | 25 |
| | Total | 3.8 | 0.41 | 0.38 | 0.02 | 0.03 | 0.7 | 41 | 2.0 | 0.096 | 0.023 | 0.004 | 0.001 | 0.016 | 0.003 | 0.012 | 0.071 | 0.173 | 1.40 | 24 |
| Grand Total |
| 35.0 | 0.44 | 0.40 | 0.02 | 0.03 | 0.7 | 46.0 | 1.8 | 0.102 | 0.025 | 0.004 | 0.001 | 0.017 | 0.003 | 0.013 | 0.075 | 0.183 | 1.39 | 25 |
Notes
1. TREO = Total Rare Earth Oxide, HREO = Heavy Rare Earth Oxide, LREO = Light Rare Earth Oxide, SEGO = SEG Oxide
2. The Mineral Resource is reported at a 0.2% TREO cut-off grade
3. Moisture content is set out as %
4. No constraining shell is required as stacks are above ground level
5. Adequate initial metallurgical testwork and financial analysis has been completed to satisfy reasonable prospects for economic evaluation
6. The favoured mineral processing route uses a continuous ion exchange (to remove impurities) followed by REE leach and REE refining to produce three saleable products: neodymium/praseodymium oxide, dysprosium oxide, and terbium oxide; all processing is expected to be on-site at the Phalaborwa Mining Complex adjacent to the phosphogypsum stacks
7. Tonnages are rounded to the nearest 100,000 tonnes to reflect this as an estimate
MRE - Contained Metal
| | | | Contained Metal (tonnes) |
| | ||||||||
| JORC 2012 | Stack | Mt | Nd2O3 | Pr6O11 | Dy2O3 | Tb4O7 | Sm2O3 | Eu2O3 | Gd2O3 | La2O3 | Ce2O3 | Dry BD | Moisture |
| Measured | Stack A | 10.8 | 11,214 | 2,704 | 466 | 152 | 1,896 | 379 | 14 | 8,272 | 19,831 | 1.37 | 25 |
| | Stack B | 5.2 | 5,721 | 1,439 | 228 | 79 | 953 | 198 | 7 | 4,261 | 10,345 | 1.33 | 27 |
| | Total | 16.0 | 16,935 | 4,143 | 695 | 230 | 2,849 | 577 | 21 | 12,533 | 30,176 | 1.36 | 26 |
| Indicated | Stack A | 11.0 | 10,724 | 2,545 | 455 | 145 | 1,797 | 371 | 13 | 7,929 | 19,436 | 1.46 | 22 |
| | Stack B | 3.9 | 4,109 | 1,009 | 168 | 54 | 693 | 142 | 5 | 3,115 | 7,515 | 1.31 | 27 |
| | Rubble/Mixed | 0.4 | 275 | 60 | 11 | 4 | 50 | 9 | 0 | 183 | 453 | 1.42 | 27 |
| | Total | 15.2 | 15,109 | 3,615 | 634 | 202 | 2,540 | 521 | 19 | 11,227 | 27,404 | 1.42 | 24 |
| Inferred | Stack A | 1.7 | 1,602 | 379 | 66 | 20 | 264 | 55 | 2 | 1,169 | 2,920 | 1.48 | 21 |
| | Stack B | 1.6 | 1,624 | 388 | 68 | 22 | 280 | 58 | 2 | 1,241 | 2,953 | 1.33 | 27 |
| | Rubble/Mixed | 0.6 | 420 | 100 | 16 | 6 | 80 | 15 | 0 | 299 | 708 | 1.42 | 25 |
| | Total | 3.8 | 3,646 | 867 | 151 | 48 | 624 | 127 | 4 | 2,710 | 6,580 | 1.40 | 24 |
| Grand Total |
| 35.0 | 35,689 | 8,624 | 1,479 | 480 | 6,012 | 1,225 | 44 | 26,469 | 64,161 | 1.39 | 25 |
Notes
1. The Mineral Resource is reported at a 0.2% TREO cut-off grade
2. Metal Content is quoted to the nearest ton
3. Moisture content is set out as %
4. No constraining shell is required as stacks are above ground level
5. Adequate initial metallurgical testwork and financial analysis has been completed to satisfy reasonable prospects for economic evaluation
6. The favoured mineral processing route uses a continuous ion exchange (to remove impurities) followed by REE leach and REE refining to produce three saleable products: neodymium/praseodymium oxide, dysprosium oxide, and terbium oxide; all processing is expected to be on-site at the Phalaborwa Mining Complex adjacent to the phosphogypsum stacks
7. Tonnages are rounded to the nearest 100,000 tonnes to reflect this as an estimate
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