Critical mineral processing nabs $243M in government grants

Prime Minister Scott Morrison yesterday announced that the federal government has committed $243m in grant funding for the processing and refinement of critical minerals, as listed in Australia’s 2022 critical minerals strategy.

This is the first grant as part of the federal government's $1.3 billion Modern Manufacturing Initiative.

The $243m in grant funding will be split across four projects, including vanadium and rare earths.

Of the four projects that received funding, we were most interested in the $30M grant that Arafura Resources received for its rare earths (NdPr) project in the NT. Here the company plans to construct a “first of its kind” rare earth separation plant - only the second of such plant outside of China.

With the government stepping in and providing capital to develop a rare earths processing and refining industry in Australia, the future for local rare earths explorers and producers looks bright.

All of this affirms our macro thinking behind the latest addition to the Catalyst Hunter portfolio - Frontier Resources (ASX: FNT). FNT is preparing for a drilling program right next door to another Hastings technology metals “Yangibana project”, which is expected to come into production 2023 and has the highest grade resource of its peers in the rare earths space.

Interestingly, Hastings was also a recipient of a government loan of ~$140M which is being used to develop its project.

Click here to view our 2022 Investment Memo and see why we invested in FNT and what we want the company to achieve in the year ahead.