en.Wedoany.com Reported - Aclara Resources (TSX: ARA) has finally obtained environmental approval for its Penco Module rare earth project in Chile. The company stated that this outcome underscores the need for governments to fully capitalize on opportunities presented by critical minerals.
In a press release, Aclara confirmed that its Environmental Qualification Resolution (RCA) formally validates the environmental permit granted by the Environmental Assessment Commission of the Biobío Region in south-central Chile, concluding a permitting process that spanned over four years. Penco is located approximately 430 kilometers south of Santiago.
In an interview with The Northern Miner, Executive Vice President Jose Augusto Palma expressed relief at the completion of the approval process but noted that the broader context of critical mineral development requires better coordination from governments on permitting. He believes that Peru, Chile, Brazil, and Argentina, as mining-focused nations, face a significant opportunity to leverage demand for critical minerals to establish downstream value chains.
The environmental permit is a key step for Aclara to become one of the few Western companies building a vertical rare earth supply chain. The company's pilot plant at Virginia Tech in Blacksburg, Virginia, is expected to produce the first batches of separated light and heavy rare earth oxides this year, sourced from ionic clay deposits at the Penco and Carina modules in Brazil. The pilot plant is designed to support Aclara's construction of a commercial-scale separation facility in Louisiana.
According to a 2021 preliminary economic assessment, the Penco project is expected to produce approximately 774 tonnes of rare earth oxides (REO) annually over a 14-year mine life. At a 5% discount rate and a base case price of $96 per kilogram of REO, the project has an after-tax net present value (NPV) of $178 million and an internal rate of return (IRR) of 23%. The initial capital expenditure of $119 million is recoverable after-tax within 4.7 years.
Palma said the company is encouraged to move into the next phase of the project and is optimistic about obtaining all construction permits by early next year. Aclara plans to release a feasibility study for Penco by the end of the year, with production potentially starting in 2027. The Louisiana facility is also expected to be completed next year.
In Tuesday afternoon trading, Aclara's shares fell 3% to $4.17 per share, giving the company a market valuation of approximately $1 billion. The stock has traded in a range of 90 cents to $5.40 over the past 12 months. Major shareholders include Eduardo Hochschild (37% stake), Hochschild Mining (LSE: HOC, 20% stake), and CAP S.A. (10% stake).
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