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Rare earths miner Lynas has signed an updated contract with the US Department of Defence (DoD) for the construction of its heavy rare earth processing facility in Texas.

Lynas was in 2022 awarded a $120-million contract from the DoD to build a commercial heavy rare earths facility in the US.

The updated contract is an expenditure-based contract under which all of Lynas’ properly allocable construction costs will be reimbursed, with the DoD increasing its support from $120-million to approximately $258-million.

The updated contract follows detailed design work and cost updates since the original design was completed.

“We are delighted to work with the US DoD to deliver our US heavy rare earths separation plant in Texas, which is a key pillar of Lynas’ growth strategy. This further support by the DoD demonstrates the priority being given to developing robust and resilient rare earth supply chains,” said Lynas MD and CEO Amanda Lacaze.

“Our heavy rare earths separation plant will be the first of its kind outside China and will help to establish a globally significant, safe and environmentally responsible rare earths supply chain. Lynas is the only commercial scale source of separated rare earths outside of China and our expertise makes us the ideal partner for the DoD as it addresses supply chain vulnerabilities and strengthens national security.”

Lynas’ US rare earths processing facility in Texas will serve both DoD and commercial customers and is targeted to be operational in the 2026 financial year.

Once operational, feedstock for the facility will be sourced from the Lynas Mt Weld rare earths deposit and Kalgoorlie rare earths processing facility in Western Australia. Mt Weld is recognised as a world-class source of light and heavy rare earth minerals. The US facility will be able to process feedstock from other sources if/when they become available and are qualified.

“Seadrift, Texas, is an excellent location for our facility and we thank the local authorities for providing such a warm welcome. We are excited to collaborate with local community leaders to create advanced manufacturing jobs and economic opportunities,” Lacaze added.