Name of the Project
Makuutu rare earths project.

Location
Uganda, 120 km east of Kampala.

Project Owner/s
Ionic Rare Earths (IonicRE). The company currently owns 51% of Makuutu; however, it will increase its stake to 60% on the completion of the feasibility study before October 2022 and has a pre-emptive right over the remaining 40% stake.

Project Description
Makuutu is an ionic adsorption clay (IAC) deposit. IAC deposits contain rare-earth elements (REE) ionically bonded to the clay rather than existing as primary minerals in the ore.

A base case scoping study has demonstrated the potential for Makuutu to become a sustainable, long-life operation, supplying critical rare-earth oxide (REO) and heavy rare-earth oxide (HREO) to global markets and generating strong financial returns while delivering significant social and economic benefits for the local communities.

The study proposes openpit mining over an initial 11-year mine life, with the IAC run-of-mine (RoM) fed into a modular heap-leach plant, where the REO is recovered from the IAC mineralisation using salt desorption to produce a mixed rare earth carbonate product.

The first module will process 2.50-million tonnes a year of RoM and produce about 800 t/y REO equivalent product.

Additional modules will be added in years 2, 4, 6 and 9 to increase the plant throughput up to 12.50-million tonnes by Year 10.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The project has an after-tax net present value, at an 8% discount rate, of $321-million and an internal rate of return of 38%, with a payback of about five years.

Capital Expenditure
Total capital expenditure (capex) is estimated at $301-million.

Preproduction capex, including contingency, is estimated at $89-million for Module 1, including the mining fleet.

The Module 2 expansion in Year 2 is estimated at $40-million.

The expansion from Module 2 to 5, estimated at about $172-million, will be funded from project cash flow.

Planned Start/End Date
Production is expected in 2024.

Latest Developments
IonicRE CEO Tim Harrison has outlined the company’s main priorities for the remainder of this year and 2022, before it takes a final mining decision on the Makuutu rare earths project.

These include validation testwork on the project and potentially also a demonstration plant to help derisk the adoption of the technology related to the project.

The project is undergoing a 7 800 m Phase 4 infill drilling programme, with which the company aims to increase resource confidence from the inferred to indicated classification on the large resources Area 1.

This area has an inferred resource of 96-million tonnes. The company intends for the indicated and measured resource base to be more than 250-million tonnes.

More than 5 000 m of drilling have been done to date and IonicRE expects to conclude drilling in the coming weeks.

The current drill programme is meant to inform a feasibility study and resource upgrade, but the company plans to undertake more exploratory drilling around the project, possibly next year.

The company is targeting the completion of a feasibility study over the next 12 months. Other near-term objectives include the signing of offtake agreements, getting financing in place and receiving approval from the Ugandan government on its environmental-impact assessment, once it is submitted, in the fourth quarter.

Ionic intends to apply for a mining licence by November 2022 and start producing rare earths in 2024.

Key Contracts, Suppliers and Consultants
None stated.

Contact Details for Project Information
IonicRE, tel +61 8 9481 2555.