What's Happening?
Harena Rare Earths, a London-listed company, has completed a prefeasibility study (PFS) for its Ampasindava ionic clay rare earth project in Madagascar. The study confirms the project's technical viability and provides a robust economic framework for its development.
The PFS, supported by global engineering group SGS, indicates a long-life heap leach operation with a total rare earth oxide (TREO) production of about 71,000 tonnes over a 20-year life-of-mine. The project is expected to have a plant throughput of five million tonnes per year, with a pre-production capital cost estimated at $142 million. The study projects an undiscounted life-of-mine free cash flow of $1 billion post-tax, with a pre-tax net present value (NPV) of $343.7 million and a post-tax NPV of $249.6 million. Harena plans to advance the project with a phased 'proof of concept' plant and has strong support from the Malagasy government.
Why It's Important?
The completion of the prefeasibility study marks a significant milestone for Harena and the Ampasindava project, highlighting its potential as a world-class heavy rare earth asset. The project's development is crucial for the rare earth industry, which is vital for various high-tech applications, including electronics and renewable energy technologies. The economic viability of the project could enhance local, regional, and national economies in Madagascar, providing job opportunities and fostering local business development. Additionally, the project's focus on sustainable extraction methods aligns with global environmental standards, potentially setting a precedent for future mining projects.
What's Next?
Harena plans to proceed with a definitive feasibility study (DFS) and further optimize the project to reduce costs and process risks. The company is preparing for the construction phase, expected to begin in 2027, with ongoing environmental and social studies to support permitting. Harena's engagement with the Malagasy government and local communities will be crucial in ensuring the project's smooth progression. The company aims to establish a permanent on-site laboratory and test facilities to optimize the extraction process and prepare for full-scale production.
Beyond the Headlines
The Ampasindava project's development could have broader implications for the global rare earth market, potentially reducing dependency on dominant suppliers like China. The project's focus on sustainable practices may influence industry standards, promoting environmentally responsible mining. Additionally, the project's success could encourage further investment in Madagascar's mining sector, contributing to the country's economic growth and development.
