Drilling carried out by RareX last year has paid off with a 47% increase in overall resource tonnage at its Cummins Range rare earths project in Western Australia’s Kimberley region.

Resources at the project now stand at 18.8 million tonnes grading 1.15% total rare earth oxides (TREO) that includes 0.23% neodymium and praseodymium plus 0.14% niobium oxide.

The inclusion of niobium for the first time is significant as the metal used for lightweight high-strength steel alloys currently commands a price of US$92.65 per kilogram, or about three times the basket price of Cummins Range rare earths, making it a potentially valuable by-product.

Equally significantly, RareX (ASX:REE) has also defined a maiden Indicated Resource of 11.1Mt at 1.3% TREO including 0.27% NdPr plus 0.17% niobium oxide and a higher grade core of 6.5Mt at 1.98% TREO (including 0.38% NdPr) plus 0.21% niobium oxide.

Indicated Resources have sufficient information on geology and grade continuity to support mine planning.

The market was understandably stoked at the news, sending shares in REE up more than 16% to 9.4c this morning.

RareX Managing director Jeremy Robinson said the increase in both the scale and grade of the Resource places Cummins Range at the forefront of rare earth projects on the ASX and highlights the great work undertaken by the company’s technical team over the past year.

“Apart from the overall 47% increase in tonnage, we have also posted a sizeable increase in high-grade tonnes and a very significant maiden Indicated Resource of 11.1Mt, which will be available for conversion to ore reserves as part of upcoming economic studies,” he added.

“Importantly, we believe that there is enormous scope to grow the resource further, both in overall size and grade.

“We have seen some very encouraging indications from the recent expansionary drilling and we are really looking forward to seeing what the upcoming diamond drilling will reveal.”

Rare earths value

With rare earths such as NdPr being a crucial component in wind turbines and in the drive train of hybrid and electric vehicles, Cummins Range has the potential to underpin a standalone rare earth oxide producer and supplier of concentrate to third parties within Australia and overseas.

Notably, the significant levels of high-value NdPr, terbium, dysprosium and scandium also translate to an attractive basket price of US$33.60/kg for its TREO.

This is particularly important given that the majority of world’s heavy rare earths come from China and neighbouring Myanmar, making non-Chinese sources of rare earths valuable for ensuring supply chain security.

Drilling delivering growth

Initial assessments of RareX’s recently completed RC program already appear to support the revised geological model.

Holes drilled to the northeast have also intersected structures that are known to host high-grade mineralisation in the main fault.

The company also expects the diamond rig to arrive next week to test the interpreted high-grade structure at depth.

It noted that the main fault has not been tested below 100 vertical metres with the two deepest holes drilled to date recording significant mineralisation.

This article was developed in collaboration with RareX, 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.