#None #South Africa #IDC #Carester #Frontier Rare Earths

Strategic Collaboration Between Frontier Rare Earths and Carester

In a significant development within the rare earths sector, Frontier Rare Earths Limited has officially signed a technology supply agreement with Carester SAS. The agreement, aimed at advancing the Zandkopsdrift project in South Africa, comes alongside a substantial $20 million equity investment from the Industrial Development Corporation (IDC). This partnership promises to enhance the project's viability, especially considering the booming demand for rare earth materials used in various high-tech applications.

Key Highlights of the Agreement

The arrangement with Carester, a leader in rare earth separation technologies, is pivotal as it enables the deployment of Carester's proprietary extraction methods at the Zandkopsdrift project. This partnership allows Frontier to leverage advanced techniques to produce high-purity neodymium-praseodymium (NdPr) oxide and mixed heavy rare earth carbonate (MHREC) efficiently. A notable aspect of this agreement is the 7-year offtake for MHREC, which will be processed at Carester's facility in Lacq, France, ensuring a steady market for the product.

Economic Benefits

The completion of an updated Prefeasibility Study (PFS) in 2025 highlighted the project's potential to become one of the lowest-cost producers of battery-grade manganese and magnet rare earths globally. The synergy derived from by-product revenue generated from battery-grade manganese is expected to cover nearly 90% of the production costs for rare earths, boasting a neodymium-equivalent production cost of less than $15 per kilogram, far below the current market price of over $100 per kilogram.

The financial outlook for the project is promising, with a post-tax net present value (NPV) of $2 billion and an impressive internal rate of return (IRR) ranging from 28% to 34%, depending on the gearing. Furthermore, the projected average annual revenue is estimated at $727 million, complemented by an impressive operating margin of 72%.

Long-Term Production Goals

Frontier's Zandkopsdrift project is designed for longevity, with an anticipated life of more than 45 years based on proven and probable reserves. During the initial 25 years of production, the company expects to produce an average of over 3,000 tons of NdPr oxide annually, alongside smaller quantities of dysprosium (Dy) and terbium (Tb) oxides. This focus on critical magnet rare earth elements reflects about 94% of the overall value contained within the rare earth outputs.

Strategic Investment from IDC

The financial injection from the IDC is pivotal, aimed at funding the Definitive Feasibility Study (DFS) and overall corporate development activities for the Zandkopsdrift initiative. Conditions for this investment were met in September 2025, reinforcing the project's progress toward its upcoming phases. The IDC also holds an option for up to 10% of the overall production at market prices, provided it's utilized in further downstream processing within South Africa.

EU Strategic Recognition

The Zandkopsdrift project has been designated as an EU Strategic Project, further emphasizing its importance in the international landscape of critical raw materials. As part of the EU's Critical Raw Materials Act and the Clean Trade and Investment Partnership between the EU and South Africa, the project is exploring multiple funding avenues within the European framework.

Looking Ahead

With all necessary permits in hand, including Mining Rights and Environmental Authorization, Frontier is keen on commencing production by 2030. Infrastructure planning covering roads, power, and process water has already been set in motion, ensuring a seamless transition from the DFS to the actual mining phase, ultimately propelling Frontier Rare Earths into a leading position in the rare earths market.

As Frontier moves forward with this ambitious project, the implications for the rare earths supply chain are substantial. The collaboration with Carester and the backing from the IDC not only signify confidence in the Zandkopsdrift project but also align with broader environmental and economic strategies aiming for sustainable development and innovation in the rare earth sector.