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Yangibana: Is this Australia’s next rare earths producer?

Yangibana

The stock of the Yangibana rare earths mine in Western Australia continues to rise as Hastings Technology Metals announced improved economics for the project.

Following a comprehensive review period lasting more than three years, Hastings has revealed an increased net present value (NPV), internal rate of return (IRR) and life-of-mine free operating cashflow for Yangibana.

Yangibana’s post-tax NPV has jumped from $549 million to $1.01 billion between 2019 and 2022 updates, while its post-tax IRR has improved from 21 per cent to 26 per cent.

The project’s life-of-mine pre-tax free operating cashflow increased by 71 per cent to $4.38 billion.

“Today is a significant milestone for the Hastings team that is the result of an extensive amount of work carried out over a number of years,” Hastings executive chairman Charles Lew said.

“The updated project economics tell a story of a world-class rare earths project that will be capable not only of delivering up to 8 per cent of global NdPr (neodymium-praseodymium) demand for a period of at least 15 years but generate significant, long-term value for all shareholders.”

The updated project economics are based on a definitive feasibility study (DFS) completed in 2017 and revised in 2021. Lew said Hastings has been on a journey to improve the viability of Yangibana.

“The Hastings team has done a tremendous job since 2017 to optimise and de-risk the Yangibana project, both technically and commercially, to make it an even more compelling investment proposition,” he said.

“Since its discovery in 2014, we were always confident in the quality of the rare earths resource endowment at Yangibana.

“As it turned out, the steady progress we have made over the years has converged with a strong global rare earths magnet market underpinned by the global energy transition and electric mobility.”

In early February, Hastings received a $140 million loan from the Northern Australia Infrastructure Facility (NAIF) to fund Yangibana.

Early works construction is expected to begin at Yangibana by the September quarter of 2022, in WA’s Gascoyne region, with first drawdown on the NAIF loan expected in early 2023.

Hastings will explore further funding options as it continues to solidify Yangibana.

“We are well advanced on discussions with a range of funding partners (in addition to NAIF) and are now focussed on finalising the appropriate capital structure that best positions Hastings for success in bringing Yangibana into production by 2024,” Lew said.

“This includes undertaking a corporate transaction or seeking a joint venture partner(s).”

Yangibana will have the capacity to meet about 6 to 8 per cent of the world’s demand for NdPr which are used to manufacture permanent magnets.

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