Peak Rare Earths has signed a binding off take agreement with Singaporean Shenghe Resources for the Ngalla rare earth project in southern Tanzania. Shenghe Resources Singapore is a wholly-owned subsidiary of Shenghe, a rare earth company headquartered in China with a market value of approximately $3.1 billion.

PEAK Rare Earth has also signed a memorandum of understanding with Shenghe on engineering, procurement, construction, and project funding cooperation. The final investment decision and construction start are expected to be completed by the end of May 2024, while construction and development are expected to be completed by early 2026.

FEED is expected to be completed by the end of November 2023 and a decision will be made on the EPC or EPCM execution mode before the end of December. Russell Scrimshaw, Executive Chairman of Peak Rare Earths, stated that we are pleased to expand our strategic cooperation with Shenghe.

The combination of a binding off take agreement and a non binding EPC and financing memorandum of understanding sets Peak apart from its peers and supports the provision of successful project financing solutions for the development of Ngalla rare earth projects.

According to the terms of the off take agreement, Peak will supply 100% rare earth concentrate and at least 50% of any intermediate rare earth products for the first seven years.

According to the non binding memorandum of understanding, Shenghe will support comprehensive development and financing solutions by arranging and providing fixed price and turnkey EPC solutions. It will provide project financing solutions to help reduce capital and operating costs, accelerate construction, and further optimize the Engla project.

Huang Ping, Vice Executive Chairman of Shenghe, stated that Shenghe believes that the Engla project is one of the world's leading undeveloped rare earth projects. We are pleased to collaborate with Peak and its Tanzanian entity Mamba Minerals to develop this world-class project by providing off take, technical, and financial support.Editor/XingWentao