Arafura Resources has solidified the importance of its Nolans rare earths project in the Northern Territory after signing a landmark memorandum of understanding (MoU) with GE Renewable Energy.
The non-binding MoU will see the two collaborate in the establishment of a sustainable supply chain for neodymium and praseodymium (NdPr), with GE to purchase NdPr from Arafura’s Nolans project on a long-term sales agreement.
The binding offtake agreement would be subject to customary conditions, including Arafura securing project funding to develop Nolans, while the company would also have to successfully construct and commission Nolans.
As part of the MoU, GE will also consider a potential strategic equity investment in Arafura, to be considered and negotiated in due course.
Rare earths are essential materials for neodymium magnets used in electric vehicles (EV) and clean energy technologies. The offshore wind industry consumes over 600kg of neodymium magnets for every megawatt of wind turbine generation capacity.
Establishing a secured rare earths supply chain de-risks GE’s magnet value chain, providing supply security and supporting the growth of the local offshore wind sector.
Arafura managing director and chief executive officer Gavin Lockyer said Nolans had an important role to play in the renewable energy transition.
“Long term, Nolans NdPr may be used in magnets critical for power generation from GE’s Haliade-x12MW, one of the most powerful offshore wind turbines on the market,” he said.
“It is very gratifying that a new supply-chain model, along with transparency of the value chain, will ensure we know exactly where our NdPr will be used, whether it is in a particular EV model or a series of wind turbine.”
GE Renewable Energy vice president and chief technology officer Danielle Merfeld said the partnership would enable the company to solidify its operations into the future.
“This MoU is another example of our efforts to develop strategic collaborations that can help us accelerate the energy transition,” she said.
“Working with Arafura gives us a new and exciting option to obtain reliable, sustainable and competitive sources of key materials going forward that will help us lower the cost of renewable energy.”