Lynas Rare Earths has signed a binding letter of intent with the United States Department of War (DoW) to finalise the supply of rare earth oxide.
Under the agreement, approximately $US96 million ($A137 million) will be allocated by the DoW, with both light and heavy rare earth oxides being purchased from Lynas at a floor price of $US110 per kilogram.
The letter of intent establishes a framework to finalise an agreement for the supply of rare earth oxides to support US national security and supply chain resilience objectives.
The products will be supplied by Lynas to the DoW over a four year period.
“We thank the US Government for working with Lynas to reach this mutually beneficial arrangement and look forward to finalising the definitive agreement in due course and continuing our productive engagement with the US government.”
It’s understood supply arrangements between Lynas and the DoW are ongoing for further rare earth oxide supply.
The agreement comes in the wake of an agreement with Japan Australia Rare Earths (JARE), emphasising Lynas’ strategic importance in the global supply of rare earths for future industry.
Under the revised arrangement, JARE will commit to purchasing 5000 tonnes per annum of neodymium-praseodymium (NdPr) from Lynas.
Operations in Malaysia have also been strengthened with a decade-long operating licence secured, providing further long-term certainty for Lynas and its global supply chain partners.