Federal Government backs rare earths

The Federal Government is putting Dubbo, NSW at the heart of its plans to grow Australia’s critical minerals and rare earths industry by providing further support for miner Australian Strategic Materials Limited (ASM) (ASX: ASM).

The Dubbo project will produce critical minerals such as zirconium, niobium and hafnium as well as several rare earth elements.

Rare earths are critical to the energy and defence industries due to their use in high-strength magnets for EVs, wind turbines and aerospace actuators.

The Federal Government will provide $5m to ASM under the International Partnerships in Critical Minerals Program to fund up to 50% of a study to find more efficient ways of refining rare earths at its mine and processing plant.

The funding is on top of a $6.5m grant provided to ASM last year by the Federal Government through the Critical Minerals Development Program to support mining, separation and refining for critical minerals at their Dubbo project.

Federal Resources Minister Madeleine King says the Federal Government is determined to support the critical minerals and rare earths industry to create wealth and jobs, reduce emissions and support the security needs of Australia and its partners.

“Government support to refine rare earths is important for our sovereign capabilities and will help our trading partners meet their economic, national security and emission reduction commitments,” she said.

Minister King says the Federal Government is supporting the development of Australia’s critical minerals sector, including rare earths, to help companies add value and diversify global supply chains. She says the Dubbo project will receive further support through the Federal Government’s plan to provide production tax incentives for critical minerals processing.

ASM managing director and chief executive Rowena Smith says this funding recognises the Dubbo project’s national and international strategic importance.

“With this funding, we will be able to undertake important work to identify lower capital and shorter implementation pathways to unlock rare earth production at the Dubbo project and ensure a focused completion of our final FEED,” she said.

“Working in collaboration with international strategic partners is critical if Australia is to play a leading role in building alternative, end-to-end rare earths and critical minerals supply chains.

“We thank the [Federal] Government for their generous support to enhance Australia’s rare earth production and processing capability.”

ASM received a non-binding letter of interest from the Export-Import Bank of the United States this year for up to $898m (US$600m) to support the construction of the project.

Export Finance Australia has previously provided ASM a letter of support for $200m in debt funding.