Geomega Resources Inc., a rare earth clean technologies developer for mining and recycling, and USA Rare Earth, LLC, the funding and development partner of the Round Top Heavy Rare Earth and Critical Minerals Project in West Texas, have entered into a Letter of Intent (LOI) to recycle rare earth-containing production waste from USA Rare Earth’s future production of sintered neodymium iron boron (NdFeB) permanent magnets (sintered neo magnets) in the United States.
As part of its mine-to-magnets strategy, earlier this year USA Rare Earth purchased the sintered neo magnet manufacturing equipment formerly owned and operated in North Carolina by Hitachi Metals America, Ltd. (Earlier post.) USA Rare Earth is currently evaluating options for the location of the plant, which will become the first neo magnet manufacturing plant in North America since the Hitachi facility ceased operations in 2015.
Other domestic sources of neo magnets either import magnets for assembly in the US or import sintered neo magnet blocks that are machined and assembled in the US.
The plant was designed to produce in excess of 2,000 tonnes of sintered neo magnets per year, or approximately 17% of current US demand for neo magnets. The process of manufacturing and machining neo magnet blocks generates up to 30% swarf and scrap (up to 600 tonnes), which needs to be recycled.
Material from USA Rare Earth’s facility and material from machining of other blocks will be the feed for Geomega’s recycling plant located in St-Bruno, Québec which, after processing, could become one of the rare earth oxide feeds required for USA Rare Earth’s magnet plant.
USA Rare Earth is expected to make all its swarf and scrap available for Geomega to recycle for a minimum period of five (5) years, commencing on the effective date of a definitive agreement between the companies.
Geomega and USA Rare Earth will negotiate mutually acceptable commercial terms including the possibility of a license agreement to develop a recycling facility at the location of its permanent magnet factory. Until such time, this LOI remains non-binding.
According to industry estimates, permanent magnets are a $21 billion-a-year global market split between high performance magnets (70%) and lower performance ferrite magnets (30%) used in applications such as chargers for electrical devices and other applications where weight and performance are less important and operating conditions are less extreme.
At $13.8 billion, neo magnets dominate the high-performance magnet market, replacing aluminum-nickel-cobalt and samarium-cobalt technologies. Industry sources project the global neo magnet market will expand by nearly 100% to $27.0 billion in 2027.
In 2019, the US purchased approximately 12,000 metric tonnes of neo magnets at an average price of approximately $71,000 per tonne, according to industry estimates, representing 6% of the global rare earth magnet market. This does not include magnets in finished and semi-finished products that are imported.
If the US merely maintains its current 6% share of the global market, annual purchases of rare earth magnets will increase by more than 7,000 tonnes by 2027, or an annual increase of more than 900 tonnes per year.
Based in Boucherville and St-Bruno, Canada, Geomega Resources has developed a proprietary, environmentally friendly “ISR Technology” that recycles rare earth elements with focus on the permanent magnet industry and produces four high demand, high price, rare earth elements (HHREE — specifically Nd, Pr, Tb, Dy).
The company is advancing towards initial production from its demonstration plant to supply HHREEs to North America and other parts of the world.
Geomega also owns the Montviel rare earth carbonatite deposit and holds over 16.8 million shares, representing approximately 19% of the issued and outstanding shares of Kintavar Exploration Inc., a mineral exploration company that is advancing the Mitchi stratiform copper project in Quebec.