American Rare Earths Signs MOU with Novex for Rare Earth Oxides

en.Wedoany.com Reported - American Rare Earths (ARR) has signed a Memorandum of Understanding (MOU) with U.S.-based Novex for rare earth oxides (REOs). Under the agreement framework, rare earth oxides produced from the Halleck Creek project in Wyoming will be converted into metals used for permanent magnets.

The MOU was signed by Wyoming Rare (USA), a wholly owned subsidiary of ARR. Under the terms, Novex will receive neodymium-praseodymium oxide from ARR's demonstration plant for conversion into rare earth metals. The parties plan to collaborate on process optimization and develop design solutions for domestic rare earth metal production facilities, with the goal of building a mine-to-magnet supply chain located entirely within the United States.

The conversion of rare earth oxides into metals is considered a bottleneck in the magnet manufacturing process, with the majority of supply in this segment currently controlled by China. In April 2025, China imposed export licensing requirements on samarium, gadolinium, terbium, dysprosium, and yttrium, elements used in high-temperature and defense-grade magnets. Additionally, starting in January 2027, U.S. defense contractors will be prohibited from using magnets containing rare earth elements mined, refined, or separated in China, a policy that has further intensified focus on developing domestic metal production capacity.

The agreement was reached following ARR's evaluation of multiple metallization technologies, including fluoride conversion with calciothermic reduction, lanthanum reduction, and high-temperature molten salt electrolysis. The evaluation results indicated that molten salt electrolysis is the leading candidate technology best suited for development, while lanthanum reduction will be retained for certain specific metals. Novex has previously developed similar oxide-to-metal processes and operates a technology center in Bellingham, Washington.

The parties plan to finalize the commercial structure and terms of a long-term supply and cooperation agreement within 12 months. The Halleck Creek project has a mineral resource estimate of 2.63 billion tons, with the site located entirely on state-owned land and supported at both the federal and state levels, including a non-binding letter of intent from the Export-Import Bank of the United States for up to $456 million in potential funding.

ARR CEO Mark Wall stated: "This MOU is a key step in advancing our stated goal of establishing the only fully American-owned, vertically integrated mine-to-magnet supply chain. Our technical assessment shows that molten salt electrolysis is the cleanest path from oxide to metal, and Novex has been developing this capability in the United States for years, working with multiple U.S. government agencies and leading consulting firms."