Iluka Resources said on Tuesday that the Australian government has provided a A$1.65 billion ($1.15 billion) non-recourse loan to build the Eneabba rare earths refinery in Western Australia.
Iluka said the loan access was confirmed by Export Finance Australia, the country’s export credit agency.
The funding comes as Western countries look to reduce their dependence on rare earths from China, the largest producer, for the materials that are vital for electric vehicles and other technologies.
Iluka expects the first tranche of the funding, comprising A$1.25 billion, to be fully drawn by 2026-end, when Eneabba is expected to be 75% complete. The refinery is currently over 50% complete, the company said.
Eneabba will be Australia’s first fully integrated rare earths refinery, according to the company.
The miner said Civmec has been awarded a contract for structural, mechanical, piping, electrical and instrumentation (SMPEI) works at the refinery.
Separately, Iluka said it had concluded a binding agreement for the supply of magnet rare earth oxides to an unnamed global automotive company.
The agreement has an initial term of four years, and represents about 10% of Iluka’s planned production over that period.
Iluka expects revenue over the contract period to be $155 million minimum and $172 million assuming prices forecast by the industry.
($1 = 1.4290 Australian dollars)
(By Nichiket Sunil; Editing by Sahal Muhammed)
