GE Vernova Helps Secure $300M For Arafura's Rare Earth Project, Targets Stronger Supply Chain

Export Development Canada (EDC) has conditionally approved $300 million in debt financing for Arafura Resources' ARAFF Nolans rare earths project. This funding, facilitated by GE Vernova GEV, is a step forward in securing the necessary funding for the project, which is essential for the global supply chain of rare earth materials used in offshore wind turbines, electric vehicles, and other advanced technologies.

“Debt financing from EDC signifies the increasing geostrategic importance of the Nolans project and securing global diversity in the NdPr [neodymium and praseodymium] supply chain,” said Arafura managing director Darryl Cuzzubbo.

This financing builds on previous support, including $100 million from the Australian government's Northern Australia Infrastructure Facility and $125 million from Export Finance Australia. The Export-Import Bank of Korea also issued a letter of interest for up to $75 million.

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The combined financial backing underscores the strategic significance of the Nolans project, which will include a mine, processing plant, and related infrastructure at the Nolans site.

Located 135 kilometers north of Alice Springs, Australia, the Nolans project is expected to operate for at least 23 years, producing approximately 1 million to 1.3 million tons of ROM ore annually and 316,000 tons per annum of concentrate. It will yield significant amounts of neodymium (Nd) and praseodymium (Pr), which are crucial for manufacturing ultra-strong permanent magnets used in electric vehicles, wind turbines, smartphones, and robotics.

GE Vernova signed a strategic partnership with Arfura in 2022, recognizing its potential for providing a stable supply of rare earth materials for its renewable projects. Facilitating the financing from EDC was but one step in strengthening that partnership.

Arafura has already completed a comprehensive due diligence process with financiers and is in advanced negotiations for offtake agreements with potential buyers. The EDC facility’s availability is contingent upon Arafura achieving an 80% binding offtake target, a slight revision from the previously stated 85%. Additionally, Arafura is in discussions with a select group of international and domestic banks to finalize the remaining project financing.

The conditional approvals from EDC and the Australian government are expected to provide impetus for finalizing credit approvals from the remaining lenders.

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