Washington link-up boosts St George’s Brazilian rare earths ambitions

St George Mining has made a strategic move to strengthen ties with the United States Government by appointing a leading government relations firm, as the aspiring producer looks to provide in-demand critical minerals such as rare earths and niobium to the Western world’s most powerful nation.

The company’s ground-breaking Araxá critical minerals project, which houses the second-highest grade of lucrative rare earths in the western world, is ideally placed geographically to meet critical metals demand from US Government Departments and large public companies. 

With the Trump Administration introducing initiatives in a seemingly all-out effort to secure its slice of the critical minerals pie, St George has seized the moment and empowered Washington DC firm, Ervin Graves Strategy group, to engage with key US Government agencies.

Recently, the US Government turned more than a few heads with its $1.6 billion (A$2.286 billion) funding package for USA Rare Earth, which included wrapping its taxpayer-funded hands around a 10 per cent stake in the Texas based firm. 

USA Rare Earth holds the multi-rare-earth-element Round Top deposit in West Texas and is building a serious magnet manufacturing facility in Oklahoma, which will be capable of producing hundreds of millions of magnets annually.

The decision to invest in USA Rare Earth followed the US Government-backed International Development Finance Corporation’s move in November to loan $465 million to Brazilian firm Serra Verde to help the development of its Pela Ema rare earths mine in Brazil.

With the US Government keen to pump money into projects capable of meeting its critical mineral needs, the timing looks ideal for St George to push for support for Araxá.

St George Mining executive chairman John Prineas said: “Our 100 per cent owned Araxá Project aligns closely with US policy to support development of critical minerals in the Western world. We are excited to have engaged Ervin Graves to progress the potential for St George to attract government funding support and downstream industry partnerships in the US.”

The Araxá project, in the renowned mining State of Minas Gerais in Brazil, holds a world-class mineral resource of 40.6 million tonnes grading 4.13 per cent total rare earth oxides (TREO) and is the largest carbonatite-hosted rare earths deposit in South America.

Notably, the resource includes valuable magnet rare earth oxides, which make up almost 20 per cent of the total resource, potentially positioning the project as an economically strong offering.

An added ace up St George’s sleeve is the addition of the highly sought-after mineral – niobium – which provides another possible revenue option to Araxá’s critical metals mix. Having a swag of niobium grading 0.68 per cent in its kitbag just adds to the project's commercial viability.

The demand for niobium has driven the value of several projects into the stratosphere, including WA1 Resources’ Luni project, which was awarded Major Project Status by the Australian Government last year and now carries a cool market capitalisation of $1.36 billion.

That valuation is backed by a mineral resource of 220 million tonnes of niobium, grading a healthy one per cent of the critical metal.

Niobium is a critical metal used to add muscle to high-strength low-alloy steels, strengthening the material for infrastructure uses such as building bridges and pipelines. Its high-temperature resistance also makes it ideal for superalloys used in rockets and jet engines and its non-toxic properties create demand for use in medical implants and pacemakers.

St George has clearly read the room in Washington, pointing to the US Government’s appetite for backing high-quality, high-grade projects in friendly, strategically located jurisdictions.

Quite rightly, with such a valuable project on its hands, the company now appears to be jostling for a spot at the table to secure its piece of the action.

Is your ASX-listed company doing something interesting? Contact: matt.birney@businessnews.com.au