American Rare Earths’ broadens growth horizons from strong base

Special Report: On a trip to Australia not long after being appointed CEO at American Rare Earths, Donald Swartz says he’s confident the company is ideally placed to be the next major rare earths business in North America.

Swartz is in Australia for American Rare Earths’ AGM and to remind investors here that they remain key players as the company advances the world-class Halleck Creek project in Wyoming and transitions to being a US based entity.

Australian-founded small cap’s big US move

The transition got into full swing in the second half of this year as American Rare Earths (ASX:ARR) appointed Swartz, as well as other US-based senior management and directors, to cement its increasingly important strategic presence stateside.

The company that began its life focusing on Australia’s famous Broken Hill region has been steadily building that presence over the past couple of years. But it’s had a major shot in the arm in 2023 thanks to the ongoing progress at Halleck Creek, which was this year ranked fifth globally in mining.com’s list of top rare earths projects.

Halleck Creek’s huge potential

The Wyoming project has a Maiden JORC Resource of 1.43 billion tonnes including 4.73 million tonnes of contained Total Rare Earth Oxides (TREO), with about 24% of that valuable Neodymium (Nd) and Praseodymium (Pr) oxides.

ARR plans to upgrade the JORC resource after highly encouraging development drillingwas completed last month. Assay results are due in December – and still only 25% of the 3304 hectares (8165 acres) project has been explored.

This development of Halleck Creek mirrors the surging interest in rare earths across North America which is fuelled by concerns about China’s dominance in the supply of minerals critical for clean energy, modern communications and homeland security.

Particularly important to all those sectors are the NdPr elements essential to the magnets used in batteries for offshore wind turbines, EVs and more. It’s these minerals ARR is targeting at Halleck Creek, as well as its exciting new Beaver Creek deposit, also in Wyoming, and La Paz in Arizona.

As ARR works towards its Scoping Study for Halleck Creek, it’s recently received more positive metallurgical test results indicating that ore can be processed with both lower initial capital expenditure and ongoing operating costs.

Economic and environmental impacts are also reduced because of the almost negligible levels of penalty radioactive elements at Halleck Creek and La Paz, a standout feature among many rare earths projects. This feature of the ore has also helped ARR be selected by leading US Government supported R&D initiatives developing a sustainable and secure domestic rare earths supply chain.

Right place, right time

Swartz says Wyoming’s well-established infrastructure alongside its mining-friendly culture and political landscape bode well for a streamlined government permitting process, especially given rare earths’ strategic importance.

“I’ve spent a lot of my career in Wyoming’s Powder River Basin and there is very considerable mining capability,” Swartz says.

“You’ve got there a highly skilled workforce, plus capital and readily available equipment that can be redeployed from coal into rare earths mining. That’s particularly the case with the truck-and-shovel open pit mining we can do at the large-scale and shallow Halleck Creek deposit.”

Currently the Mountain Pass Mine in California is the only US-based rare earths producer. But federal backing that’s part of the $370 billion Inflation Reduction Act (IRA) aims to boost investment in more mines and downstream processing.

“While the IRA is a Biden Administration initiative, there’s a rare bipartisan backing in Washington for its goals and there are macro factors driving this,” Swartz says.

“Republicans highlight the need for domestic job creation and national security, while Democrats rally behind magnet metals as they’re crucial for the electric vehicle and green energy technology.

“But whoever wins the next US election the increasing electrification of so many things, from our cars to grid-scale renewable energy storage, will continue apace.

“This means there’ll be ongoing accelerating demand for magnet metals and we believe we’re well-positioned to play a significant role in meeting that demand.”

Building investor base

ARR is well-funded for its growth plans, finishing the last quarter with A$9.6 million in its coffers.

As it looks ahead, ARR has now made investing in the company more accessible to US investors by upgrading its OTC listing as a precursor to also trading on the world’s second largest stock exchange, the Nasdaq.

But, Swartz says, its Australian investors are still pivotal to the company by enabling it to undertake all its growth activity.

“It’s been great to be here and meet our Aussie investors, some who have been with the company long-term and others who are newer to the company,” Swartz says.

“We’re very grateful for their support and I’m confident we’ll build value for all our shareholders in 2024 as we execute our plans to realise the potential of our US assets.”

This article was developed in collaboration with American Rare Earths, a Stockhead advertiser at the time of publishing.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.