PNN hits over 12% Total Rare Earths Oxides from surface in Brazil

Our rare earths Investment Power Minerals (ASX: PNN | OTCQB: PEIMF) just released assay results from the fourth hole at its rare earths project in Brazil.

Most rare earth projects report only Total Rare Earth Oxides (TREO), which can be made up mostly of the lower value, more common, well supplied rare earths.

PNN reports Magnetic Rare Earth Oxides (MREO) as well, which are the in demand, valuable rare earths.

Specifically these four elements: neodymium, praseodymium, terbium and dysprosium.

And they are used in applications such as EV motors, robotics, wind turbines and defence systems:

Today PNN released more high grade results, headlined by 88m at 6.33% TREO from surface, including 1.19% MREO.

Inside that sat 20m at 12.05% TREO with 2.18% MREO from just 18m:

(source)

These are more magnet rare earth grades that can legitimately be measured in percentages in their own right.

Today's hole also hit a second zone below the high grade section, still at decent grades, which shows mineralisation appears to continue at depth to the northeast.

(source)

This is something we were wondering about when the prior hole was released, which we covered here:

(source)

That lower zone from today runs 79m at 1.11% TREO below the high grade 88m part of the hole, which could allow PNN to add some significant tonnage to a potential Maiden Resource.

The drilling crew have been busy too with a few holes are pending at the lab, more are underway and there are two drill rigs spinning right now adding to the queue:

(source)

PNN's aim for this drill program is to put out a Maiden Resource, so it will be interesting to see just how much sits at the ultra high grades near surface, plus more useful tonnage if further holes like today's come in.

PNN also explicitly flagged today that the program is targeting a high grade, near surface, open pit potential operation:

(source)

Of note, there was also some more gallium (a critical mineral), with a single 1.5m section undergoing assay at the lab.

This returned 49.9ppm gallium, and additional checks being done by the lab to further validate the initial gallium results.

Brazil to solve the western rare earths supply chain problem?

Brazil is home to the world's second biggest rare earth reserves (behind only China). (source)

We came across this from a week ago:

(source)

Here is another article specifically highlighting the region that PNN’s project sits in is a rare earth hotspot inside Brazil, calling it the "new front" for rare earths:

(source)

There is also corporate precedent for interest in Brazilian assets:

1. The US$2.8BN USA Rare Earth's takeover of Serra Verde - the only large-scale producer outside Asia producing rare earths from ionic clays. The deal comes with a 15-year US government supply agreement including a price floor. (source)
2. A US$250M letter of interest from the Export-Import Bank of the United States (EXIM) to PNN's next door neighbour Meteoric Resources for its Caldeira project. (source)

$16BN Lynas Rare Earths former CEO has publicly said they are looking at Brazil for rare earths assets - here is what she had said at the time:

"Yes there are deposits there, yes there are deposits in Brazil. Yes we are looking at them." (source)

(source)

Even the EU is looking to do a Brazil minerals deal:

(source)

So there is definitely a group of important global capital allocators that are open to cutting cheques for Brazilian assets.

What's next for PNN?

🔄 Maiden drill program at Morro do Ferro (MDF)

Here are the milestones we are tracking:

1. ✅ First hole assays (116m at 4.78% TREO)
2. ✅ Second hole assays (Prior - 137m at 4.31% TREO, incl. 53m at 9.87%)
3. ✅ Hole 3 assays (Released prior)
4. ✅ Second rig starts (full operations + two extra shifts since 4-Aug)
5. 🔄 More drilling (two rigs, program runs through December)
6. 🔲 Metallurgical test work drilling
7. 🔄 Gallium follow up results (new best hit with hole 3: 2m at 87.7ppm Ga from 83m), more gallium in the single 1.5m section sampled in hole 4 today.

🔲 Maiden JORC resource estimate at Morro do Ferro (MDF)

Expected before the end of the year - this is the big one for us.

🔲 Ionic clay potential tested at Morro do Ferro (MDF)

The "free shot" at the style of deposit that made PNN's neighbours worth a combined ~$1BN.