Victory built on ‘cracking the code’

Massive funding is pouring into a global scramble to produce vital, high-grade defence and industrial materials and Australian resources minister Madeleine King underlined the increasing urgency of the mission at the public launch of a tiny Perth pilot rare earth processing operation this week.

“There are a lot of trade restrictions on not only the product but on the know-how that goes into making that product and to be able to have that knowledge developed here in Western Australia and other places in the country is of such vital strategic importance to our country,” King said at Victory Metals’ back-office R&D laboratory in Burswood.

“I can't emphasise that enough.

“Pilot plants like this and getting this technology right [are] a really important step in building our sovereign intellectual property.”

That sovereign IP is connected to breakthrough heavy rare earth concentration and separation technology being refined and, soon, scaled in a multi-national collaboration involving Australian and US technical experts. Earlier this year Victory and Perth’s Curtin University announced a pact linking the Australian Government-backed, Curtin-led Resources Technology and Critical Minerals Trailblazer program and Victory’s unusual North Stanmore RE clay deposit near the small town of Cue in WA and also the company’s formative work with groups in the US advancing innovative metallisation methods.

Curtin has an understated reputation for developing world-class mining technologies but head of the university’s WA School of Mines, John Curtin distinguished professor Mark Buntine, hasn’t been backward in calling out its mineral processing and hydrometallurgy tech credentials and describing Victory’s project as “nationally significant”.

Billions of public and private dollars are flowing into this sector in the US and elsewhere (the US most publicly) in a race to deliver rare earth and other metals critical to defence, AI, clean energy and other product manufacturing. Not just manufacturing today, but future production of even more advanced materials.

China’s dominance of global RE and other metal supply chains, established over decades in a process that has also concentrated related expertise and IP in the east Asian country, has left industrial complexes in the US, Japan, Europe and elsewhere vulnerable to supply-line interruption or worse.

Phoenix Tailings, a Massachusetts-based company co-founded by Massachusetts Institute of Technology alumni, this week promoted a conditional commitment from the US Department of War to provide a US$500 million loan for its proposed “Freedom Facility”, a rare earth separation and metallisation venture still looking for a home but with $1 billion of reported funding behind it. Phoenix, an electrochemistry tech company, has also announced more than $116 million of private equity funding in the past 12 months.

USA Rare Earth this month confirmed $1.6 billion of US Department of Commerce loan and grant backing to add to $1.5 billion of private capital funding announced in January. The company is advancing a hydrometallurgical RE processing and separation demonstration facility in Colorado, USA, and is seeking to accelerate buildout of a large-scale domestic mine-to-magnets supply chain.

Victory Metals last year said it had secured a letter of interest from the Export-Import Bank of the United States (EXIM) for up to $190 million in debt financing.

The company’s veteran technical director, professor Ken Collerson, said in Perth this week there were several US companies “just crying out for our product”.

“The same in Japan,” he said.

“They’ve got the technology now to take concentrate, break it down and separate the individual RE elements. It’s new technology.

“Chinese technology is advanced but it’s basically solvent extraction; the sort of thing that Iluka is doing [at Eneabba in Western Australia].

“This is a new chromatographic separation technique that’s been developed in the United States.”

On the back of its positive pilot-scale circa-60-fold upgrade in rare earth concentration using a standard flotation method – with preservation of the “premium dysprosium, terbium and yttrium basket that makes this [North Stanmore] deposit strategically important” – Victory is closing on completion of its prefeasibility study and progressing offtake exchanges.

CEO Brendan Clark said North Stanmore’s mineralogy put it in a truly rare position in the global rare earth landscape.

“Most clay-hosted rare earth deposits cannot be concentrated by flotation at all,” he said.

“Their rare earths are ionically adsorbed onto clay surfaces and must be recovered by leaching or desorption. Most flotation-amenable rare earth deposits, by contrast, are hard-rock monazite, xenotime or bastnasite ores, requiring energy-intensive processing.

“Combined with Victory’s previously reported ability to extract its premium heavy rare earths under low acid, ambient temperature, atmospheric pressure leaching conditions, the flowsheet avoids the high-temperature acid cracking step and the associated capital cost, estimated at up to A$1 billion based on peer project capital requirements that defines conventional hard rock rare earth development.”

Collerson, a geologist and University of Queensland emeritus professor with decades of industry experience, said breakthrough processing technology combined with North Stanmore’s mineralogy and heavy RE enrichment could give Victory an edge in a production race featuring seemingly more advanced major projects in Australia, Brazil and other parts of the world.

“This is the best project I've been involved with,” he said.

“[Others] are more advanced but they've got the wrong mix of rare earths.

“Our system is 40% enriched in heavy rare earths. We’ve got very low levels of radioactivity because of the [regolith crust] weathering. The groundwater has gone out of the system and removed the uranium and thorium. There’s only seven parts per million thorium and two parts per million uranium ... as opposed to [thousands of parts per million in] some of the other systems.”

Collerson said North Stanmore also did not have the high moisture content of Brazil’s ionic clay RE deposits, nor did it have the same issues with competing land uses.

“It's a game changer for the industry.”

Victory, a circa-$215 million ASX company, has seen its share price nearly double in the past 12 months.

Clark said the pilot testing milestone had been “three years and millions of dollars” in the making.

“Most of the IP for rare earths and separation comes from China and is very protected,” he said.

“We’re relying on one country, and the world's relying on one country, to produce rare earths and specifically heavy rare earths, which is a very scary thing.

“To be able to crack the code like we are is a very, very big milestone for our company.

“These rare earths are not only important for the renewable energy transition but they're critical for our national defence so it's a very important thing for Australia.”