Third Offtake MOU Agreement Signed with Qiandong Rare Earth Group
Sydney, Sep 13, 2017 AEST (ABN Newswire) - Hastings Technology Metals Limited's (
ASX:HAS) (Hastings or the Company) is pleased to advise that it has signed its third Memorandum of Understanding (MOU) with Qiandong Rare Earth Group (GQD). Under the MOU the parties have outlined their intent to enter into a binding commercial offtake agreement for the sale by Hastings and purchase by GQD of Mixed Rare Earth Carbonate ("MREC"), which will be produced from Yangibana, Western Australia. The framework for the commercial offtake agreement is set out in the MOU, and the final terms and conditions will be formalised in a contract.
HIGHLIGHTS
- Hastings announces its third MOU with Qiandong Rare Earth Group for the future supply of Mixed Rare Earth Carbonate from Hastings' Yangibana project in Western Australia.
- The parties have agreed to enter into discussions to formalise a commercial offtake agreement for Hastings to sell 1,500 tonnes of Mixed Rare Earth Carbonate (MREC) per annum to Qiandong Rare Earth Group.
- This third MOU agreement is for a period of three years with an option to extend for two years.
- Total of three MOUs signed so far represent approximately 40% of planned MREC annual production from Yangibana.
INTRODUCTION
The Parties have undertaken to negotiate in good faith to reach agreement for a commercial offtake contract within 12 months from the date of the MOU. Pricing for the MREC will be based on a formula taking into account prevailing market prices prior to shipment.
Charles Lew, Hastings Executive Chairman, said "This third MOU for an offtake agreement with GQD provides confidence that a strong demand market exists for the Company's high quality NdPr product. Prices for NdPr have increased by approximately 85% in 2017. Our production samples from the pilot test work earlier in the year contained over 40% NdPr of Total REOs. The exciting news announcement over the weekend of China's plans to set a deadline for the ban of fossil fuel vehicles will accelerate the move towards electric vehicles. This follows similar announcement from France and the UK to ban fossil fuel powered cars. The trend towards the electrification of transportation will lead to an increase in the demand for NdPr through the next decade and beyond, and Hastings will be a new source of NdPr to the market."
The Parties have additionally acknowledged that any commercial offtake agreement is contingent on Hastings starting operations and production of MREC from the Yangibana mine, and with any additional conditions usually included in commercial off-take contracts.
Hastings estimates an annual production quantity of 15,000 tonnes of MREC, which it will sell to offtake partners, with production projected to commence in 2H 2019.
GQD
Qiandong Rare Earth Group( called "GQD" for short), is an established leading manufacturer of rare earth derived products. The company is located in China's ionic clay deposits region of Ganzhou and was founded in March 1988.
GQD, through its 11 subsidiary companies, has formed an advanced rare earth industrial supply chain from mining to finished components. GQD has been able to supply more than 60 different rare earth products and related materials, including rare earth oxides, metals, compounds, alloys, magnetic materials and phosphors, etc.
After nearly 30 years' development, GQD has established business relationships with multiple customers in Asia, America and Europe.
About Hastings Technology Metals Ltd
Hastings Technology Metals Ltd (ASX:HAS) (FRA:5AM) is advancing its Yangibana Rare Earths Project in the Upper Gascoyne Region of Western Australia towards production. The proposed beneficiation and hydro metallurgy processing plant will treat rare earths deposits, predominantly monazite, hosting high neodymium and praseodymium contents to produce a mixed rare earths carbonate that will be further refined into individual rare earth oxides at processing plants overseas.
Neodymium and praseodymium are vital components in the manufacture of permanent magnets which is used in a wide and expanding range of advanced and high-tech products including electric vehicles, wind turbines, robotics, medical applications and others. Hastings aims to become the next significant producer of neodymium and praseodymium outside of China.
Hastings holds 100% interest in the most significant deposits within the overall project, and 70% interest in additional deposits that will be developed at a later date, all held under Mining Leases. Numerous prospects have been identified warranting detailed exploration to further extend the life of the project.
Brockman Project
The Brockman deposit, near Halls Creek in Western Australia, contains JORC Indicated and Inferred Mineral Resources, estimated using the guidelines of JORC Code (2012 Edition).
The Company is also progressing a Mining Lease application over the Brockman Rare Earths and Rare Metals Project.
Hastings aims to capitalise on the strong demand for critical rare earths created by the expanding demand for new technology products.
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