ARR Signs MoU with Novex for US Rare Earth Magnet Metals

American Rare Earths (ASX: ARR) signed a memorandum of understanding with U.S. metallurgy firm Novex to turn separated rare earth oxides from its Halleck Creek project in Wyoming into the metals needed for permanent magnets. The deal aims to build a domestic supply chain that bypasses China's dominant processing and refining network.

The MoU sets a framework for a long-term commercial relationship. It covers process optimisation, metallisation of output from a demonstration plant, and joint design of a rare earth metal production facility. The two parties will use reasonable commercial efforts to agree on definitive terms within 12 months, with regular progress reviews and technical working group sessions along the way.

The agreement follows a technology review by American Rare Earths that looked at ways to enter the midstream segment of the mine-to-magnet chain – the step from separated oxide to metal, then to alloy precursors for magnet production. The company screened several technologies and found more than one viable route. Options included fluoride conversion followed by calciothermic reduction, lanthanothermic reduction for volatile metals such as samarium, and high-temperature molten salt electrolysis.

The review concluded that molten salt electrolysis was the cleanest option because it reduces dependence on anhydrous hydrogen fluoride, a hazardous chemical, and does not consume a saleable rare earth metal as a reductant, unlike lanthanothermic reduction. The company will advance molten salt electrolysis as its primary development candidate, with lanthanothermic reduction as a backup for volatile target metals.

“Our technology review demonstrated that molten salt electrolysis is the cleanest path from oxide to metal and Novex has been developing that capability in the US for years while working with various areas of the government and leading consulting companies,” American Rare Earths chief executive officer Mark Wall said.

Novex CEO Ilija Mišković said his company “look forward to metallising American Rare Earths’ oxide products and working together to advance a US rare-earth metal and alloy production facility.”

Halleck Creek is the largest known deposit of total contained rare earth oxides in the United States. Its mineral resource estimate of 2.63 billion tonnes carries the potential to supply domestic magnet metals for several hundred years. The project sits entirely on Wyoming state land and has drawn strong federal and state support, including a non-binding U.S. Export-Import Bank letter of interest for funding of up to US$456 million.

Wall said the Wyoming value chain would now extend from ore, through refining and separation, to the metals that feed magnet manufacture. The MoU builds on the company’s work earlier this year on oxide-to-metal processing and its demonstrated ability to produce separated oxides from Halleck Creek ore.

The next milestone is the 12-month window to finalise commercial terms. A definitive agreement would give the company a clearer path to revenue from downstream metal sales, though the timeline for a production-scale facility remains open-ended.