Completion of acquisition - Phalaborwa Project

RNS Number : 0829J

Rainbow Rare Earths Limited

18 December 2020

 

Rainbow Rare Earths Limited

("Rainbow" or the "Company")

(LSE: RBW)

18^th December 2020

Completion of acquisition for the Phalaborwa Rare Earths Project

Rainbow Rare Earths Ltd is pleased to announce the initial completion of the transaction to acquire the Phalaborwa Rare Earths Project following the conclusion of the due diligence process under the Co-Development Agreement signed with Bosveld Phosphates (Pty) Ltd.  As detailed in the Company's announcement of 3 November 2020, the Initial consideration payable upon completion is US$0.25 million, with two additional tranches of equal amounts paid over the next twelve months in cash or shares.

George Bennett, CEO, said:  "We are delighted to have completed our initial due diligence on the significant body of data available from the historical pilot plant operations, which continues to show encouraging results and underscores our confidence in this exciting project.  I look forward to updating the market on progress, as we believe Phalaborwa will enable the Company to become a very significant producer of Neodymium and Praseodymium (NdPr), the two key metals required for the permanent magnets to drive the electric vehicles and wind turbines of the green revolution."

**ENDS**

For further information, please contact

Rainbow Rare Earths Ltd	Company	George Bennett Pete Gardner	[phone]
SP Angel Corporate Finance LLP	Broker	Ewan Leggat Charlie Bouverat	[phone]
Flagstaff Strategic and Investor Communications		Tim Thompson Fergus Mellon	[phone] [e-mail]

Notes to Editors:

Rainbow's strategy is to become a globally-significant producer of rare earth metals.  NdPr are vital components of the strongest permanent magnets used for the motors and turbines driving the green technology revolution.  Analysts are predicting demand for magnet rare earth oxides will grow substantially over the coming years, driven by increasing adoption of green technology, pushing the overall market for NdPr into deficit.

The Company's Gakara Project in Burundi, which produces one of the highest-grade concentrates in the world (typically 54% total rare earth oxide ("TREO")) through ongoing trial mining operations, is currently the only African producer of rare earths.  The Gakara basket is weighted heavily towards NdPr, which account for over approximately 19.5% of the contained TREO and 80% of the value of the concentrate.

The Phalaborwa Rare Earths Project, located in South Africa, comprises approximately 35 million tonnes of gypsum resulting from historic phosphate hard rock mining, containing rare earth elements with an estimated average in situ grade of 0.6% TREO, based on previous sampling campaigns, of which 30% comprises high-value NdPr.  The rare earths are contained in chemical form in the gypsum stacks, which is expected to deliver a higher-value rare earth carbonate, with lower operating costs than a typical rare earth mineral project.

 

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