Lynas Corporation Limited (LYC) has signed a Strategic Alliance Agreement with Sojitz Corporation to secure additional supply of Rare Earths products for the Japanese market by accelerating the expansion of the Lynas Rare Earths project.
The objective of the Agreement is to provide a stable and long term source of supply for the Japanese market by providing a framework for Lynas and Sojitz to agree off-take, distribution and financing arrangements during 2011 which would enable the acceleration of Phase 2 of Lynas’ Rare Earths mine and Concentration Plant at Mount Weld in Western Australia and the Lynas Advanced Materials Plant (LAMP) in Malaysia.
Phase 1 operations are scheduled to begin in the third quarter of 2011, with an initial capacity of 11,000 tonnes REO (Rare Earths Oxide) per annum. If successful this transaction will allow Sojitz, a leading Japanese trading firm and the largest supplier of Rare Earths into Japan, to be the exclusive distribution company for Lynas product into Japan.This agreement will result in more than 70% of the Lynas 22,000 tonne capacity now allocated.
Lynas Executive Chairman Mr Nick Curtis said: “This landmark agreement will enable Lynas to accelerate marketing to Japanese customers. If implemented, it will enable Phase 2 construction to be committed in April 2011 and be online in 2012, expanding the capacity of the LAMP to 22,000 tonnes REO per annum”.
Sojitz is a leading Japanese trading firm and the largest supplier of Rare Earths into Japan. As a general trading company Sojitz conducts transactions and business operations in Japan and overseas in a wide range of fields including machinery, energy and metals, chemicals and functional materials, and consumer lifestyle businesses.
Lynas owns the richest known deposit of Rare Earths in the world at Mount Weld, near Laverton in Western Australia. This deposit underpins Lynas’ strategy to create a reliable, fully integrated source of Rare Earths supply from the mine through to customers in the global Rare Earths industry. Lynas will concentrate the ore mined at Mount Weld in a Concentration Plant approximately 1.5km from the mine.