TORONTO AND WEST
PERTH, Australia, May 1, 2024
/CNW/ - Neo Performance Materials Inc. ("Neo") (TSX:
NEO) has entered in to a non-binding Memorandum of Understanding
(the "MOU") with Meteoric Resources NL
("Meteoric") (ASX: MEI) for offtake of 3,000 metric tonnes
(MT) total rare earth oxide ("TREO") per year from
Meteoric's Caldeira Project (the "Project") in Minas Gerais,
Brazil, to supply Neo's magnet
manufacturing plant
Key Highlights
- The MOU provides the framework for the parties to negotiate a
binding commercial offtake agreement for the supply of mixed rare
earth carbonate ("MREC") from the Caldeira Project.
- Under the contemplated offtake agreement NPM Silmet OÜ
("Silmet"), Neo's rare earth separation facility in
Sillamäe, Estonia, is expected to
purchase 3,000 MT TREO per year from
the Caldeira Project's initial production, and hold a right of
first refusal to purchase additional material when the Caldeira
Project produces more than 6,000 MT
TREO per year.
- Annual offtake of 3,000 MT TREO
from the Caldeira Project could supply Neo with as much as
900 MT of Nd-Pr oxide and 30 MT of
Dy-Tb oxide, combined, to supply Neo's sintered rare earth
permanent magnet manufacturing plant under development in nearby
Narva, Estonia.
- Meteoric expects to obtain a construction permit by Q4 2025 and
aims to commence MREC production during the second half of
2027.
- The Minas Gerais region is one of the world's largest producers
of niobium, iron-ore, tantalum, lithium, vanadium and bauxite.
Meteoric Resources' CEO,
Nick Holthouse, said:
"We are very pleased to be bringing this important agreement
with Neo to market. This represents Meteoric's first step in our
staged offtake strategy, and are delighted to support Neo in their
aim to provide high-performance magnetics for automotive, factory
automation, high-efficiency motors, residential appliances, and
many other industries. Connecting and integrating into the
developing alternate rare earth materials supply chain signals
strong external market confidence in the Caldeira Project`s ability
to progress to an FID and into production. We look forward to
working with NEO and having the benefit of their technical support
as we continue to pursue and develop our own downstream
capabilities and progress to a binding commercial arrangement."
Neo Performance Materials' CEO,
Rahim Suleman, said:
"We are laser focused on laying the groundwork for rare earth
supply by securing offtake from diverse projects around the world.
We are excited to add the Caldeira project to our growing pipeline
of prospective sources of rare earth feedstock which could enable
us to increase capacity utilization at Silmet and supply the needs
of our sintered rare earth magnet plant in Europe when it comes online. The Caldeira
Project is one of a group of key MOUs and agreements we have signed
in securing feedstock. This provides our customers with maximum
supply chain optionality."
Offtake Agreement
The MOU outlines the general terms on which Neo is expected to,
subject to final negotiations and customary conditions, enter into
a binding offtake agreement for annual purchases of MREC containing
3,000 MT TREO from Meteoric's
Caldeira Project. The term of the offtake agreement is expected to
extend until Neo has purchased a total of 30,000 MT TREO, with a customary renewal provision
for subsequent terms.
The MOU also contemplates a right of first refusal for Neo to
purchase additional MREC that Meteoric produces from the Caldeira
Project in excess of 6,000 MT TREO
per year, on similar terms.
The precise pricing mechanisms underpinning the offtake
agreement, which is expected to be based on standard terms and
conditions for such supply, remain subject to final negotiation of
the binding offtake agreement.
About Neo Performance
Materials
Neo manufactures the building blocks of many modern technologies
that enhance efficiency and sustainability. Neo's advanced
industrial materials – magnetic powders and magnets, specialty
chemicals, metals, and alloys – are critical to the performance of
many everyday products and emerging technologies. Neo's products
help to deliver the technologies of tomorrow to consumers today.
The business of Neo is organized along three
segments: Magnequench, Chemicals & Oxides and Rare Metals.
Neo is headquartered in Toronto, Ontario,
Canada; with corporate offices in Greenwood Village, Colorado, United States; Singapore; and Beijing, China. Neo has a global platform that
includes 10 manufacturing facilities located in China, the United
States, Germany,
Canada, Estonia, Thailand and the United Kingdom, as well as one dedicated
research and development centre in Singapore. For more information, please visit
www.neomaterials.com.
About Meteoric Resources
Meteoric Resources NL (ASX : MEI) is a Perth based rare earth company that is
progressing its flagship Caldeira Project in Minas Gerais,
Brazil to become Brazil's next rare earth producer. The
Caldeira Project is a true Ionic adsorbed Clay (IAC) deposit with
above industry TREO grades and excellent metallurgical recoveries
using a standard Ammonium Sulphate (AMSUL) wash flowsheet. These
grade and recovery characteristics allow a simple flowsheet to be
developed to produce a Mixed Rare Earth Carbonate (MREC) with very
low capital and operating costs. Meteoric aims to become a
significant volume, low-cost producer and is committed to
supporting and integrating into western supply chain
opportunities.
Cautionary Statements Regarding
Forward Looking Statements
This news release contains "forward-looking information" within
the meaning of applicable securities laws in Canada. Forward-looking information may relate
to future events or the future performance of Neo. All statements
in this release, other than statements of historical facts, with
respect to Neo's objectives and goals, as well as statements with
respect to its beliefs, plans, objectives, expectations,
anticipations, estimates, and intentions, are forward-looking
information. Specific forward-looking statements in this discussion
include, but are not limited to, the following: expectations
regarding certain of Neo's future results and information,
including, among other things, revenue, expenses, sales growth,
capital expenditures, and operations; statements with respect to
current and future market trends that may directly or indirectly
impact sales and revenue of Neo; expected use of cash balances;
continuation of prudent management of working capital; source of
funds for ongoing business requirements and capital investments;
expectations regarding sufficiency of the allowance for
uncollectible accounts and inventory provisions; analysis regarding
sensitivity of the business to changes in exchange rates; impact of
recently adopted accounting pronouncements; risk factors relating
to intellectual property protection and intellectual property
litigation; risk factors relating to national or international
economies, geopolitical risk and other risks present in the
jurisdictions in which Neo, its customers, its suppliers, and/or
its logistics partners operate, and; expectations concerning any
remediation efforts to Neo's design of its internal controls over
financial reporting and disclosure controls and procedures. Often,
but not always, forward-looking information can be identified by
the use of words such as "plans", "expects", "is expected",
"budget", "scheduled", "estimates", "continues", "forecasts",
"projects", "predicts", "intends", "anticipates" or "believes", or
variations of, or the negatives of, such words and phrases, or
state that certain actions, events or results "may", "could",
"would", "should", "might" or "will" be taken, occur or be
achieved. This information involves known and unknown risks,
uncertainties and other factors that may cause actual results or
events to differ materially from those anticipated in such
forward-looking information. Neo believes the expectations
reflected in such forward-looking information are reasonable, but
no assurance can be given that these expectations will prove to be
correct and such forward-looking information included in this
discussion and analysis should not be unduly relied upon. For more
information on Neo, investors should review Neo's continuous
disclosure filings that are available under Neo's profile
at www.sedarplus.ca.
SOURCE Neo Performance Materials, Inc.