Defense Metals (TSXV:DEFN, OTCQB:DFMTF) has recently entered into a memorandum of understanding (MOU) with the Saskatchewan Research Council (SRC) to enhance the development of a domestic rare earths supply chain.
This strategic collaboration, announced on September 26, aims to achieve three primary objectives. Firstly, the partnership will explore potential joint initiatives related to the processing and supply of rare earth materials. Secondly, discussions will encompass the utilization of SRC’s rare earths separation technology for Defense Metals’ products. Lastly, negotiations will be pursued for a long-term supply agreement.
The SRC has established proprietary technologies for rare earths separation, while Defense Metals is advancing its Wicheeda rare earths project situated approximately 80 kilometers north of Prince George in BC, Canada. Guy de Selliers, executive chairman of Defense Metals, highlighted the significance of this partnership in fortifying North American supply chains for critical materials.
De Selliers stated, “By collaborating with SRC, we believe we can make significant strides in closing the rare earth supply chain loop and ensuring the availability of these vital materials for green energy and defense applications crucial for national security.”
This MOU aligns with broader national initiatives aimed at reducing dependency on foreign sources for critical minerals. The Canadian government’s Critical Minerals Strategy prioritizes the development of domestic mineral industries to bolster the country’s economic security and competitiveness in clean energy and defense sectors.
The partnership is expected to support national security objectives by guaranteeing the availability of essential rare earths utilized in a variety of modern technologies, including electric vehicles and military systems.
Furthermore, the SRC recently achieved commercial-scale production at its rare earths processing facility in Saskatoon, Saskatchewan. Operating since this past summer, the facility is currently producing rare earth metals at commercial levels, with an initial output of 10 metric tons per month of neodymium-praseodymium metals. The facility boasts purities exceeding 99.5 percent and a conversion rate of over 98 percent.
This milestone positions the Canadian province as the first jurisdiction in North America to achieve commercial-scale rare earths production. The SRC plans to scale up production to 40 metric tons per month by December of this year and aims for an annual production capacity of 400 metric tons by early 2025.
In a similar move, the SRC also signed an MOU with Arafura Rare Earths (ASX:ARU, OTC Pink:ARAFF) to investigate the processing of rare earth materials from Arafura’s Nolans project in Australia at the SRC’s Saskatoon facility. The focus of this agreement is on processing heavy rare earths like dysprosium and terbium, crucial components for high-performance magnets in electric vehicles and other technologies.
As the demand for clean energy technologies continues to rise amidst the ongoing energy transition, the rare earths industry is garnering increased attention. However, the supply chain remains vulnerable due to China’s dominant position in the market.
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