London-listed Rainbow Rare Earths made considerable strides during the financial year ended June 30 towards establishing an independent supply chain for the rare earth elements (REE) that are driving the green energy transition, CEO George Bennett says in a statement on the company’s preliminary results for the period.

The main focus this year was commissioning the Phalaborwa pilot plant in South Africa to demonstrate and optimise the unique flowsheet developed for recovering REE from phosphogypsum, he explains.

“I am extremely proud of our team’s hard work in establishing and optimising the primary front-end leach flowsheet, which has resulted in a much more simplified process compared with that which was published in our preliminary economic assessment (PEA), maintaining REE recoveries at 66%.

“Extensive testwork, including repeatability tests, has given us a high level of confidence in our primary flowsheet,” Bennet highlights.

Rainbow expects this achievement of significant optimisation and simplification of the Phalaborwa primary plant flowsheet will bode well for the updated economics of the project to be released in an interim report before the end of the year.

Rainbow expects the honing of this technology to unlock a global opportunity for low-cost and responsible magnet rare earth supply from similar secondary sources.

Results from the primary pilot plant in South Africa, alongside preliminary results from the continuous ion exchange (CIX)/continuous ion chromatography (CIC) separation pilot plant in the US, have delivered two saleable products, namely a mixed rare earth carbonate, and separated neodymium and praseodymium (NdPr) of about 96% purity, facilitating the first commercial recovery of rare earths from phosphogypsum, Bennett informs.

Once optimisation of the NdPr oxide separation is complete, focus will turn to the separation of the heavy rare earths – dysprosium and terbium.

Rainbow states that the market for rare earth permanent magnets nearly doubled between 2020 and this year, and that demand is forecast to continue to grow strongly by about 7% a year over the next decade, according to Argus Media, driven by the global green energy transition, as well new markets such as robotics and advanced air mobility.

There are also efforts to diversify the supply chain for REE, which is largely dominated by China, the company points out.

Rainbow posits that Phalaborwa’s status as a near-term, low-cost and strategic source of all four critical rare earths used in permanent magnets was underscored by a proposed $50-million investment from the US International Development Corporation through strategic shareholder TechMet.

It also highlights project validation from the royalty and share placement agreement announced post year-end with Ecora Resources, raising $10-million.

FINANCIAL

Rainbow recorded a $4.3-million loss for the year.

The group invested $10.6-million during the year to progress the Phalaborwa project with an additional cash outflow of $2.6-million for general and administrative costs, including costs relating to the Gakara asset in Burundi.

The group balance sheet is dominated by the cumulative $15.7-million relating to the Phalaborwa asset, which has been capitalised as an intangible asset, of which $10.9-million was incurred in the year.

At the balance sheet date, the group has no tangible fixed assets and no obligations for environmental closure at the Phalaborwa site.

At period-end, the group had total cash of $100 000 prior to the announcement, on July 1, of the $10-million financing with Ecora. Following receipt of these funds, after associated costs, the group has available cash resources of $9.7-million.

Based on a review of cash flow forecasts for the period to December 31, 2025, additional funding of about $1.5-million will need to be raised before then, the timing of which is dependent primarily on the speed at which the Phalaborwa definitive feasibility study is completed.

Also, further funds may be required to progress the Uberaba opportunity in Brazil or other new business opportunities.