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Rainbow Rare Earths clears hurdle for Phalaborwa study with Neo deal
Neo will have offtake rights to 40% of Phalaborwa’s NdPr oxide and 65% of its SEG+ heavy rare earth output, with technology support aimed at enabling a prefeasibility study in Q4.
Rainbow Rare Earths said it has cleared a key technical hurdle at its Phalaborwa rare earth project in South Africa through an offtake and processing agreement with Neo Performance Materials, a step that the company says sets up a prefeasibility study (PFS) for the fourth quarter.
Under the memorandum of understanding, Toronto-based Neo would receive offtake rights to 40% of Phalaborwa’s annual production of separated neodymium-praseodymium (NdPr) oxide and 65% of its mixed SEG+ heavy rare earth carbonate. Pricing would be based on relevant rare earth indices under commercial terms, while Neo would provide technology, design input, and technical support for Rainbow’s final solvent extraction circuit.
Test work using material from Phalaborwa is underway at Neo’s facilities in Estonia, followed by an integrated pilot-scale campaign in Johannesburg. The companies said the partnership resolves the remaining step needed to define the process for extracting rare earths from phosphogypsum waste, and the PFS is expected to establish final products, processing route, and waste streams with enough certainty to advance financing and permitting.
Rainbow expects a definitive feasibility study in the first half of 2027. The Phalaborwa approach targets rare earth recovery from legacy phosphogypsum stacks from fertilizer production rather than mining fresh ore, and the memorandum is subject to binding long-form agreements as commercial terms are finalized.