LSE-listed rare earths miner Rainbow Rare Earths reports that its 70% share in the 38.3-million-tonne Phalaborwa rare earths project, through an amendment to an agreement for co-development and joint venturing in the project with Bosveld Phosphates, has been confirmed.

When the joint venture (JV) was announced in November 2020, a mechanism was included in the agreement to enable for Rainbow’s JV ownership to vary from 60% to 85%, dependent on the results of a prefeasibility study.

The amended agreement, signed on January 18, confirms Rainbow’s shareholding in the JV at 70%, with the remaining 30% held by Bosveld.

Rainbow CEO George Bennett says the amendment serves to underscore Rainbow’s belief in the significant potential of the Phalaborwa rare earths project and removes any uncertainty surrounding the benefit derived by Rainbow by fixing its majority shareholding at 70%.

This amendment removes any downside uncertainty concerning the potential to dilute Rainbow’s share within the JV, as well as assuring Rainbow’s material share in future revenue.

Technical work carried out to date has confirmed an inferred mineral resource estimate at Phalaborwa of 38.3-million tonnes at 0.43% total rare earth oxides contained within gypsum tailings stacked in unconsolidated dumps, derived from historic phosphate hard rock mining.

High-value neodymium and praseodymium oxide represents 29.1% of the total contained rare earth oxides, with economic dysprosium and terbium oxide credits enhancing the overall value of the rare earth basket contained in the stacks.

Metallurgical test work has confirmed that the phosphogypsum at Phalaborwa is amenable to direct leaching with acid to extract the contained rare earths.

“Test work has indicated that the project has the capacity to be developed as a low capital, low operating cost asset with high yields, reaching producing stage on an accelerated timeline,” Bennett adds.

This is owing to the unique nature of the project, with the rare earths contained in a cracked chemical form in the phosphogypsum, requiring no significant costs associated with mining, crushing and grinding, or chemical cracking of the underlying rare earth minerals. These tend to form the majority of the cost base for traditional hard rock rare earth mining projects, he points out.

Using the technology exclusively licensed to Rainbow for Southern Africa from K-Technologies, Rainbow plans to deliver separated rare earth oxides at the Phalaborwa site, facilitating the full value of the contained rare earth oxides to be realised for the benefit of shareholders.

“The amendment reflects our confidence in the project and is the next step in Rainbow’s overarching strategy to become a globally significant producer of neodymium and praseodymium and rare earth elements,” he says.