{kanada_flagge}Canada-based Ucore Rare Metals (WKN A2QJQ4 / TSXV UCU) has developed a proprietary technology called RapidSX™ for the separation of critical metals, particularly the rare earth metals, which dramatically improves the efficiency and environmental characteristics of the separation process. The company has already built a demonstration plant in Canada that can serve as a blueprint for building a commercial RapidSX™ plant in an existing building. And the site for the construction of the first such commercial plant has now been announced by Ucore!
{kanada_flagge}Canada-based Ucore Rare Metals (WKN A2QJQ4 / TSXV UCU) has developed a proprietary technology called RapidSX™ for the separation of critical metals, particularly the rare earth metals, which dramatically improves the efficiency and environmental characteristics of the separation process. The company has already built a demonstration plant in Canada that can serve as a blueprint for building a commercial RapidSX™ plant in an existing building. And the site for the construction of the first such commercial plant has now been announced by Ucore!
The company has decided to build its first “Strategic Metals Complex” at the England Airpark site in Alexandria, Louisiana, where it plans to replicate the process used to build the demonstration plant to accelerate construction of what it calls the Louisiana Strategic Metals Complex (LSMC). In addition, the two plants will work together to shorten the LSMC plant start-up schedule and original equipment manufacturer (OEM) product qualification trials.
The site that Ucore has chosen for its LSMC covers about 7,507 square meters and is thus larger than previously planned, so that the company has decided to design the capacity of the plant for 7,500 tons of TREO (total rare earth oxides) per year from the outset, whereas it had previously planned for “only” 5,000 tons per year!
The estimated cost of building the plant (CAPEX), which is expected to create 100 new jobs, is about $75 million, according to Ucore. However, the company is experiencing great support from the state of Louisiana and its representatives, who have held out the prospect of subsidies totaling $20 million! So far, according to the company’s reports, potential support in the amount of about 15 million USD had been announcend. (Details of the various subsidies, loan securities and other benefits to Ucore can be found in the company’s recent press release).
The choice of England Airpark is the result of a selection process that began in 2022 and included, above all, the criteria of technical suitability and expansion possibilities, environmental impact assessment and permits, integration with the local community and, of course, commercial conditions. England Airpark has been managed since 1992 by the England Authority, whose mission is to create jobs in central Louisiana. Ucore and the England Authority have now agreed to a lease arrangement that spans decades. In addition, GAEDEA (“Greater Alexandria Economic Development Authority”) has agreed to provide the company with $360,000 in subsidies over 24 months to reduce Ucore’s initial lease obligations to the England Authority.
In addition, as part of the commercial demonstration and deployment of its RapidSX™ REE separation platform, Ucore Rare Metals is working to finalize prepayment and offtake agreements with other potential Canadian and U.S. government loan, grant and/or incentive programs and other entities. All of these efforts and work will continue in 2023 and 2024 and should culminate in LSMC production testing being completed in the fourth quarter of 2024. In early 2025, it is hoped to reach the planned plant throughput of 2,000 tons of total rare earth oxides. This is to be followed by an expansion of capacity to 5,000 tons per year in 2026 and 7,500 tons per year in 2027.
Summary: Earlier this year, we speculated that Ucore Rare Metals could make a breakthrough in 2023, and while it’s still early in the year, it appears that CEO Pat Ryan’s company is on the right track, with other milestones achieved in addition to the recent announcement. Ucore is a promising but risky speculation, but the company is making good progress in lowering those risks, in our view. Ucore’s share price has also risen nearly 70% since the beginning of the year and was trading even higher at one point. In any case, we are very excited about the further development of the company and the share!
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