RareX secures support from Noble Group subsidiary Talaxis
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Special Report: RareX has received a vote of confidence from Talaxis, which will become a strategic partner and shareholder to help drive development of its Cummins Range rare earths project.
Talaxis, a specialist rare earths project developer and wholly-owned subsidiary of Noble Group, will leverage its extensive experience and relationships to assist RareX (ASX:REE) with securing offtake, financial partners and strategic investors to develop the project.
Noble Group is Asia’s leading independent energy products and industrial raw materials supply chain manager. It operates in 50 countries with annual revenues of more than $US2.5bn ($3.8bn).
“I am extremely pleased to have attracted such a high-quality partner in Talaxis to develop our flagship Cummins Range rare earths project into what is expected to be booming demand for rare earths,” managing director Jeremy Robinson said.
Noble Group head of technology metals Daniel Mamadou believes that the project has the potential to be a world-class rare earths project leading into a critical period of supply deficit.
“Our role as supply chain specialists with deep connections across Asia is to support this project across areas such as securing offtake agreements, to assist RareX to come into production,” he added.
Under the agreement, Talaxis will be responsible for providing market intelligence, global roadshows, capital introduction services, and assisting in contract procurement and negotiation.
In return, RareX will issue Talaxis 5 million options exercisable at 8.5c each that expire on October 11, 2022 along with 1.25 million REE shares. REE is currently trading at 3.1c.
Additionally, if Talaxis or one of its partners completes an outright or partial sale of the Cummins Range project, Talaxis will be entitled to a fee equal to 3 per cent of the value of the takeover if the value is less than $100m, 4 per cent if is sold at $100m to $150m and 5 per cent if the takeover is worth more than $150m.
Cummins Range currently hosts Australia’s fourth largest rare earth resource of 13 million tonnes grading 1.13 per cent total rare earths oxide (TREO).
A significant percentage of this resource is believed to consist of neodymium and praseodymium – high-value, critical elements used in the permanent magnets that are essential for electric vehicles and wind turbines.
RareX recently identified multiple drill targets that could significantly increase the project’s resource inventory.