The Company IPO’d with an Exploration Target of 20,000-80,000 tonnes which the Directors believed supported the Project given the nature of the ore at the Gakara Project and the mining method to be employed. The historic project and production data underlined the continuity of the mineralisation. Since commencing operations the Company has been highly encouraged by the ongoing results of its exploration work and drilling campaign in 2018 and is targeting a maiden JORC Resource in Q4 2018.
With a shortage of rare earth production outside of China and the desire of Western companies to ensure security of supply in the wake of the 2010-11 price spike, the Company was founded in 2011 and received its first Exploration Licence that year to re-examine the Gakara Project, which had been a producing mine from the 1940s to 1970s.
The key differentiators are its high grade, low capex and mining costs and its speed to production and sales. This is because of the high grade in-situ veins at the deposit, the volumes to be processed and sold, and due to the Company selling a high grade rare earths concentrate product. This is opposed to having to further concentrate or process its material.
The Gakara Basket is weighted heavily towards the magnet rare earths, neodymium and praseodymium, which are vital components in motors, generators, EVs and wind turbines. Based on average samples from Gakara, magnet REEs account for approximately 20% of the contained REOs within the Gakara ore, representing an average of over 80% of the contained value of REOs at current market prices.
Rare earths are widely used in a growing number of products, due to their use in permanent magnets, which make them vital to certain industries including, but not limited to, electric vehicles, wind turbines and generators, which is driving market demand.
Demand for REEs is forecast to strengthen between 2015 and 2025, but this anticipated growth in global demand is dependent on the introduction of new REE producers in North America, Australia and South Africa to fill the demand gap left by an anticipated reduction in exports from China. China’s government remains firmly focused on its domestic supply/demand balance and various government statements have often conveyed a desire to achieve a situation where domestic producers and consumers of REEs are both able to profit and expand.
The Company is aware of the social media speculation regarding the 2011 mandatory payment of $400,000, towards Burundi’s Social and Community Development. The payment was made in accordance with the terms of its Exploration Licence, which was confirmed by Presidential Decree number 100/141 dated 16 May 2011. Please read the Company’s official statement here (scroll to the bottom of the page).