PR1 partners with Oak Ridge National Laboratory on rare earth recovery from Garnet Hill

Our advanced materials Investment Pure Resources (ASX: PR1) has just signed a Strategic Partnership Projects (SPP) Agreement with UT Battelle in the US.

ORNL is the DOE’s largest multi-program science and energy laboratory - It also co-hosts the Critical Materials Innovation Hub (formerly the Critical Materials Institute).

So, PR1 will now be involved in the US Department of Energy’s critical materials ecosystem (this time looking to process heavy rare earths from its WA garnet project).

The US currently imports pretty much all of its heavy rare earths, with global production heavily concentrated from China, which is now restricting exports, especially to the US.

These elements are mission critical inputs to things such as:

• F-35 Lightning II fighter jets
• Virginia-class and Columbia-class nuclear submarines
• Precision guided munitions
• AESA phased-array radar and electronic warfare systems
• Directed energy weapons

Importantly, these rare earths cannot be substituted out (where they technically can, it comes at the cost of performance which is a clear non negotiable when dealing with these types of items).

So maybe PR1 is able to insert itself into the US heavy rare earths conversation if this partnership comes off…

(source)

We Invested in PR1, mainly for its new CNTF (carbon nanotube fibre) thermal management program with Rice University - which is separate to today’s announcement.

(more on what Carbon Nanotube Fibres are and why we like PR1 in a second)

We think the entry into the US DOE ecosystem could open the door to future funding deals for PR1’s thermal management program with Rice.

We note - PR1 had previously confirmed that it already has US government funding applications underway with both the DoE and DoD (Department of Defense):

(source)

Why we are invested in PR1

The primary reason we Invested in PR1 is for the new collaboration deal signed with Rice University for carbon nanotube fibre tech - being applied to thermal management.

The carbon nanotube fibres (think of them like wires) have thermal conductivity that is around ~10x copper (this is the individual nanotube strands) from Dexmat’s website.

When built into larger structures Dexmat’s product is still ~17% more conductive relative to copper, and 80% lighter. (source)

(perfect for thermal management in tight compact places)

Higher thermal conductivity = higher cooling requirements.

That’s where thermal interface materials (TIMs) and heat sinks matter.

AND where PR1 is focusing with its collaboration deal.

Ever seen one of these inside a computer?

That's the heat sink that sits between the chip and the cooling equipment (in the above case a fan).

Here is where the carbon nanotubes would fit - replacing the (mostly aluminium or copper) heat sink materials - because carbon nanotube fibres are more conductive and can transfer heat away from the chip more effectively.

More efficient heat transfer = lower cooling requirements.

(Source)

A carbon nanomaterial made of extremely aligned and densely packed carbon nanotubes, processed into continuous fibres and thin films:

(source: PR1 announcement)

Check out our full initiation note here: Our Latest Investment: Pure Resources (ASX: PR1) - Thermal Management for AI data centres, Military and Robotics with Rice University

Advanced materials in favour with the ASX now?

A week ago we saw ASX listed Adisyn do a $14M placement with Regal and Israel’s largest investment house Meitav.

Off the back of that placement Adisyn’s share price was up by over 400%...

Today it's capped at ~$213M.

(source)

The past performance is not and should not be taken as an indication of future performance. Caution should be exercised in assessing past performance. This product, like all other financial products, is subject to market forces and unpredictable events that may adversely affect future performance.

We think there are a lot of similarities between that company and PR1.

Both are small ASX-listed companies with world-class university partnership.

Both are working in the “materials science” space - with next gen materials looking to solve the shortcomings of existing materials (like copper).

The main difference between the two is AI1 is working with Graphene and has some decent lab data) - PR1 is working with Carbon Nanotube Fibre’s and lab data is incoming…

Here is how the two rank side by side:

Going based on how the market’s re-rated Adisyn so far, we think PR1 could have a similar re-rate moment across three of the following milestones:

1. A reproducible lab milestone from Rice - IF PR1 can show its nanotube fibre as a working thermal interface material in an industry-relevant test the market could get interested in the stock and fast.
2. A defence or hyperscale customer signal - Depending on those results, PR1 could get interest into the company from an Ai data centre builder interested in CNTF heat sinks, or this could come from a US government agency… (PR1 is already engaging with DOE and DoD funding programs).
3. A cornerstone institutional capital event - Like Adisyn did, PR1 could have some specialised investment fund see the potential and take a position - which could wake up the broader market.

We think that at this stage - there is still so much more to come from PR1…

What we want to see next from PR1

🔄 US government funding outcomes

PR1 has commenced applications to DoE and DoD funding programs. We want to see at least one of these land - it would validate the program and provide additional capital:

(source)

🔄 End user collaboration progress

Multiple organisations are already engaging. We want to see this progress toward joint development agreements or testing partnerships with named parties.

🔲 Workstream milestones

With 8 workstreams now defined, we want to see PR1 start ticking off deliverables - starting with feedstock qualification and fibre synthesis.

Recently PR1 confirmed the 8 step program to get this underway:

(source)