Co-Product Expected To Continue To Add To Makuutu’s Resource
Ionic Rare Earths Limited (ASX: IXR) is making good progress in promoting the substantial upside potential of Scandium co-product from the Makuutu Rare Earths Project in Uganda.
Since the company announced the initiation of scandium marketing activities in late January 2021, it has further increased the long life potential of Makuutu with a substantial near four-fold increase in the contained Scandium Oxide (Sc2O3) resource from prior 2,300 tonnes to 9,450 tonnes as per the Mineral Resource Estimate announced on March 3, 2021.
The Scoping Study announced April 29, 2021 provided an overview of the potential for Sc2O3 production from Makuutu, with initial production produced from one module of approximately 20-25 tonnes Sc2O3 in Year 1 ramping up to 90-100 tonnes by year 10. Negligible additional cost is incurred in the recovery and production of Sc2O3, which will report to the mixed rare earth carbonate (MREC) product at Makuutu.
Managing Director, Tim Harrison, said the low capex development at Makuutu is a clear differentiator to other potential scandium sources and provides Ionic with a tremendous advantage to help build and establish a key foothold in what the company expects will be metal of high demand once initial supply can be demonstrated.
Given the potential for a substantial increase in the Sc2O3 market in the future, enabled through derisking a supply chain driven by long term reliable, diverse and secure scandium sources, Ionic could expect the potential for scandium at Makuutu to be immense
The recent moves by global aluminium giants Rio Tinto and RUSAL to enter the scandium markets underlines the potential as a metal of the future. While the current scandium market is 15-20 tonnes per annum as Sc2O3, the global transportation industry has the potential to turn scandium into a billion-dollar market.
The existing market for aluminium across automotive, aerospace, marine, rail and space applications is approximately seven million tonnes per annum. Ionic expects there is potential for significant market penetration by aluminium-scandium (Al-Sc) alloys into this market globally, representing scope for the Sc2O3 market to grow to approximately 800 tonnes per annum.
The adoption of Sc2O3 will also be heavily dependent on its price-point. As the market grows, the Sc2O3 price is forecast to reduce as economies of scale for production can occur.
This reduction in Sc2O3 price is expected to facilitate Al-Sc to be used in an increasing number of applications, further growing the potential market.
As a result, Ionic has adopted long term Sc2O3 pricing basis reducing from approximately US$1,500 per kg today, to initial pricing of approximately US$1,000 per kg and long-term pricing for the peak Makuutu Sc2O3 production of approximately US$700 per kg.
On August 9. 2021, the company announced plans to evaluate the economics associated with the development a standalone rare earth separation and refinery for the processing of the critical and heavy rare earth dominant MREC from Makuutu.
The refinery will also separate and refine Sc to a purity exceeding 99% and is aligned with supply directly for Al-Sc master alloy manufacturing.
The company continues discussions with global groups interested in development of Al-Sc alloys and is exploring opportunities for collaboration in this sector.
Significant recent development has been in the applications for 3D printing, where components can be rapidly produced for niche components used in automotive, aerospace and space applications.
For further information please visit: https://ionicre.com.au/
