RareX teams up with Newhaul for Cummins Range haulage
Special Report: RareX has announced its subsidiary, Cummins Range Company, has partnered with Newhaul to provide product haulage and logistical support for the Cummins Range rare earth and phosphate project in WA.
The project is the largest undeveloped REE project in Australia, with an indicated and inferred resource of 519Mt at 0.31% total rare earth oxides (TREO) and 4.6% P2O5 (phosphate) for a contained 24Mt of phosphate and 1.6Mt TREO.
It also benefits from having a phosphate dominant overburden material that can be monetised as a direct shipping ore (DSO) material.
Cummins Range Company and Newhaul have now executed a binding term sheet to form a Joint Venture company and provides a commitment to negotiate a long-form haulage contract.
RareX (ASX:REE) says this partnership complements its strategic land option for product storage facilities at Wyndham Port, and the infrastructure sharing agreement for the bulk minerals loading facility (BLF) owned by Kimberley Metals Group.
Newhaul is a logistics specialist with extensive experience in providing haulage capability for resource projects.
They bring exceptional indigenous engagement, operational discipline, and data-driven haulage management experience to the project – along with a clear roadmap for the decarbonisation of their haulage fleet.
“We’re very pleased to have partnered with Newhaul in this way,” REE CEO James Durrant said.
“Newhaul has a proven operational track record and their commitment to indigenous employment and sensitive, efficient and data- driven operations is impressive and strongly aligned to the values of the team at RareX.”
The term sheet lays out the binding obligations to define forecast operational costs in support of the project’s Definitive Feasibility Studies and to reach a binding haulage contract before the end of FY24.
The timing should line up with REE’s plans to commence mining of the rock phosphate in late 2025 before the construction of a beneficiation plant to produce magnet grade rare earths (in monazite) and battery grade phosphates (in apatite) in 2028.
Notably, the term sheet with Newhaul also provides an option for Cummins Range Company to enter into the JV by acquiring 50% of the shares in JV Co for $1 plus the value of the tangible assets of the JV Company – minus the liabilities.
The option is exercisable subject to at least 500,000 tonnes of product from the project having been hauled by JV Company under the haulage agreement in any consecutive 12-month period.
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.