Backed by Western Australia’s richest person, Arafura Rare Earths has received a major $840 million finance package from the federal government for its Northern Territory project.
Backed by Western Australia’s richest person, Arafura Rare Earths has received a major $840 million finance package from the federal government for its Northern Territory project.
The federal government announced the $840 million debt financing package for ASX-listed Arafura, which is developing its Nolans rare earths mine and refinery 125 kilometres north of Alice Spring, targeting first production in 2026.
Tipped to cost about $1.6 billion to construct, the mine would produce key materials neodymium-praseodymium (NdPr) in oxide form, used in the construction of wind turbines, cars and robotics.
Counting Gina Rinehart as one of its major shareholders, Arafura said the government’s investment was just part of a broader financing package it was progressing.
It said it had indicative interest from international and commercial financers for a further $830 million in senior debt facilities. It has been in talks with international backers from South Korea, Germany, Canada and France.
The developer said the government support would be a catalyst to advance the remaining debt and equity funding requirements for the project. It said it was planning to undertake a "significant" equity raising.
Today's federal government debt package was sourced from the $4 billion Critical Minerals Facility, administered by Export Finance Australia (EFA), and the Northern Australia Infrastructure Facility (NAIF).
Fellow rare earths explorer Hasting Technology Metals also received an increased NAIF loan, in the order of $220 million, for its Yangibana project last year.
In 2022, under the Morrison government, Iluka Resources secured a $1.25 billion loan through the Critical Minerals Facility to help develop its Eneabba rare earths refinery.
Arafura managing director Darryl Cuzzubbo said securing the debt facility was a critical achievement for the Nolans project.
“Gaining this level of support from the commonwealth government is a critical milestone in becoming a globally significant producer of NdPr, a product essential for electric vehicle and wind turbine manufactures to achieve future growth targets as part of the energy transition,” he said.
“Being able to secure these debt terms reflects the quality of the Nolans project. It brings us significantly closer to making a final investment decision and contributing to a lower carbon future.
“We are thrilled to be in partnership with the EFA and NAIF, other government stakeholders, our customers and communities to create jobs and economic opportunities for many decades to come.”
Prime Minister Anthony Albanese said the project was a major vote of confidence in the NT, which continued to punch above its weight in global trade.
"The road to net zero runs through Australia's resources sector and the development of our critical minerals sector will play a key role,” he said.
The construction phase of the Nolans project is expected to create 200 jobs, with 125 full-time ongoing jobs. It's targeting 20 per cent local Indigenous employment.
