The company went back to the drawing board earlier this year after the scale of the deposit became clear, with resources of 519 million tonnes at 0.32% total rare earth oxide and 4.6% phosphorous pentoxide for 1.6Mt of contained TREO and 24Mt of contained phosphate. Neodymium-praseodymium comprises 22%, or 360,000t, of the TREO content across the Rare Dyke and Phos Dyke.
The larger prize informed a new plan that starts off with a $45 million direct shipping ore option that can operate for three years, recovering 270,000tpa of 23% rock phosphate containing 63,000tpa of phosphorous pentoxide for the fertiliser markets.
With margins expected to be around $130/t and a 1.6-year payback, stage one allows RareX to get into production, generate cash and de-risk the development, 130km from Halls Creek.
The $304 million second stage sees production of 12,000tpa rare earths and 169,000t phosphate from shallow weathered rock over a decade with the installation of a mid-sized beneficiation plant.
The monazite-apatite concentrate generated from a simple flowsheet can be processed offshore.
Staged approach
Stage three costs an additional $63 million and generates 7000tpa REE and 156,000tpa phosphate over a further five years, by upgrading the unweathered fresh rock below 130m.
All three stages generate combined average earnings of $81 million per annum with a post-tax net present value of $333 million and internal rate of return of 27%.
Over 18 years, earnings are expected to be $1.45 billion.
RareX said Cummins Range was positioned as a low-cost, low risk and nationally significant project that could meet increasing demand for phosphate-rare earth mineral concentrates in Southeast Asia to meet demand in the fertiliser and battery markets.
The 2023 enhanced scoping study built on an earlier study completed in September 2022 that would have cost $430 million upfront and produced separate REE and phosphate concentrates using a more complex processing option.
The revised work has exceeded expectations CEO James Durrant said, delivering a project that was differentiated from more conventional rare earth developments that typically have less favourable geology and more complex infrastructure requirements.
Funding options
It is working to find buyers for its initial stages with the hopes of securing a binding take-or-pay fertiliser offtake deal. RareX says its fertiliser product has a bioavailability five times that of traditional rock phosphate.
Stage one is fundable by RareX but stage two will require support.
Over the next 6-9 months, the company wants to deliver a definitive study for stage one and a prefeasibility for stage two.
The scoping study is based on the resource that covers less than half the carbonatite pipe at Cummins Range, and the company is confident in additional resource growth and additional discoveries that may boost the project life.
The development costs are expected to be met by debt and equity. RareX will investigate various government funding options and infrastructure-sharing agreements.
Stage one could be in production by the end of 2025.
RareX shares have traded at 3.5-7.8c over the past year and were last traded at 3.7c, capitalising the explorer at $25 million.
