Arafura Resources Limited (ASX: ARU) ('Arafura' or the 'Company') is pleased to report on the completion of the feasibility study update for its 100%-owned Nolans Neodymium-Praseodymium (NdPr) Project in the Northern Territory.
The recent strength in rare earths prices and increasing interest from financiers and potential offtake partners, along with project changes determined through optimisation work, provided strong rationale for Arafura to review the findings of the Nolans definitive feasibility study (DFS) delivered in February 2019.
Elements of the project that have been refined or optimised since then include the process flowsheet (following completion of final stages of pilot program); process plant design (deferral of cerium production and minor increase in concentrate processing capacity) and mine scheduling.
The updated cost estimates and financial outcomes reported in this announcement will now form the basis of discussions to finalise funding for Nolans, with Arafura targeting a Final Investment Decision in August 2022. Ahead of this - and in keeping with the revised execution strategy articulated recently - Front-End Engineering and Design (FEED) activities are expected to begin next quarter.
Following the feasibility study update, key project information and financial metrics for Nolans are as follows
Arafura Managing Director Gavin Lockyer said: 'The feasibility study update confirms Nolans as a shovel-ready world-class NdPr rare earths project with ultra-low operating costs and the capacity to deliver robust financial returns over an initial mine life nearing 40 years and it will provide an important tool with which to progress discussions on financing and offtake towards a successful close.
Following the non-binding letter of support from Export Finance Australia for a A$200m facility, we are working towards securing binding senior debt terms in line with the target for a Final Investment Decision in the second half of 2022.'
'The size of the Nolans deposit will provide our customers security of supply for their critical raw materials and our 'Ore to Oxide' at a single site provides provenance that their product is being derived from processes aligned with their ESG priorities.'
'With the forecast demand growth for NdFeB magnets to support the manufacture of electric vehicles amongst other applications, the rising imperative for nations to shore up sustainable supply chains and the lack of alternative NdPr sources outside of China, Arafura is moving ahead with greater confidence than ever before.'
Contact:
Gavin Lockyer
Tel: +61 8 6370 2800
PROJECT SCOPE
The Nolans Project will encompass a mine, process plant (comprising beneficiation, extraction and separation plants) and related infrastructure to be constructed and located at the Nolans site, 135 kilometres north of Alice Springs in Australia's Northern Territory. The Project is underpinned by low-risk Mineral Resources that have the potential to supply a significant proportion of the world's NdPr demand. It is a globally significant and strategic NdPr project which, once developed, will become a major supplier of these critical minerals to the high-performance NdFeB permanent magnet market.
ENVIRONMENT
The Nolans Project has been subject to Northern Territory and Australian environmental assessment processes administered by the Northern Territory Environment Protection Authority (NT EPA) and the Australian Government Department of the Environment and Energy (DoEE). The Company received environmental approval from the NT EPA in 2017 (refer to ASX announcement 5 January 2018) and from the DoEE in 2018 (refer to ASX announcement 14 May 2018). These rigorous and lengthy processes included an assessment of the Company's ability to manage mine waste and process plant residues and to progressively rehabilitate the site. This has been fully costed into the Project Update.
COMMUNITY AND SOCIAL BENEFITS
The Project is expected to deliver substantial social and economic benefits to local, regional and national stakeholders. This will include indigenous and local employment opportunities, small and medium enterprise business opportunities, royalties and potentially shared infrastructure. The Company estimates the peak construction workforce will be 650 people with a steady state operating workforce of 280. During steady state operations, most of the workforce will reside at site. However, the Project has the potential to accommodate community friendly rosters considering its proximity to the communities of Alice Springs, Ti Tree and Laramba.
MINING LICENCE AND PERMITTING
Australia's mining and mineral processing industry is both mature and well-regulated having been developed over many decades under the stewardship of successive state and federal governments. A Native Title Agreement (NTA) covering all parts of the Nolans Project has been executed with the site's Native Title Holders.
This NTA provides for the on-going protection of the Native Title Holders rights as well as allowing them to share in the long-term benefits of the Nolans Project
Forward Looking Statement
This report contains certain statements which may constitute 'forward-looking statements.' Such statements are only expectations or beliefs and are subject to inherent risks and uncertainties which could cause actual values, results or performance achievements to differ materially from those expressed or implied in this report. No representation or warranty, express or implied is made by Arafura Resources that any forward-looking statement contained in this report will occur, be achieved or prove to be correct.
You are cautioned against relying upon any forward-looking statement. Except for statutory liability which cannot be excluded, each of Arafura Resources and its related body corporates and their officers, employees and advisers expressly disclaims any responsibility for the accuracy or completeness of the material contained in this report and excludes all liability whatsoever (including in negligence) for any loss or damage which may be suffered by any person as a consequence of any information in this report or any error in it or omission from it. Arafura Resources accepts no responsibility to update any person regarding any inaccuracy, omission or change in information in this report or any other information made available to a person, nor any obligation to furnish the person with any further information.
Mineral Resources and Ore Reserves
The information in this report that relates to Mineral Resources is extracted from the Company's ASX announcement dated 7 June 2017 (Detailed Resource Assessment Completed) and was completed in accordance with the guidelines of the JORC Code (2012). The information in this report that relates to Ore Reserves is extracted from the Company's ASX announcement dated 16 March 2020 (Major Increase in Mine Life for the Nolans Project) and was completed in accordance with the guidelines of the JORC Code (2012). Arafura Resources confirms that it is not aware of any new information or data that materially affects the information included in the original market announcements and that all material assumptions and technical parameters underpinning the estimates in the original market announcements continue to apply and have not materially changed. Arafura Resources confirms that the form and context in which the Competent Person's findings are presented have not been materially modified from the original market announcements
ARAFURA RARE EARTHS LIMITED 
