- 01State pact backs Caladão rare earth and gallium studies.
- 02ISR field testing is targeted for 2027.
- 03Non-binding deal carries no funding commitment.
Axel REE (ASX: AXL) has formalised state government support for its wholly owned Caladão rare earths and gallium project in Brazil through a project-specific Protocol of Intent.
The agreement with the Minas Gerais State Secretariat of Economic Development and investment agency Invest Minas covers planned field validation and gallium processing development.
Rare earth in situ recovery (ISR) testing is scheduled to begin in 2027, with the state agencies positioned to assist with implementation, licensing processes, and regional suppliers.
The non-binding arrangement advances a March 2025 memorandum of understanding from broad state-level cooperation to a defined Caladão investment program without committing any party to funding.
Two Development Streams
The first workstream covers field validation of ISR techniques for rare earth elements within the Caladão project, located in the municipality of Padre Paraíso, while the second focuses on developing economically viable gallium extraction and processing techniques alongside the rare earth testing program.
Both streams are intended to establish the technical and economic basis for assessing eventual commercial production rather than constitute a decision to proceed with development.
Axel is evaluating a modular ISR concept using magnesium sulphate leaching of ionic clay-hosted rare earth mineralisation and modular processing plants within well-fields.
“This Protocol […] moves our engagement with the government from general support to a defined investment program that specifically recognises our planned ISR field validation at Caladão and our gallium development work,” managing director Dr Patience Mpofu said.
“In practical terms, it gives us a formal point of engagement within the state government as we move from the laboratory to the field, and an agency partner working to build the regional supply base that field-scale ISR will need.”
State Government Assistance
Invest Minas intends to help attract new suppliers and expand existing businesses capable of providing equipment, contractors, and services required for field-scale work.
The goal is to help build a regional supply base with the capability for field-scale ISR and gallium activities, supporting Axel as it moves towards controlled field-scale testing.
The agency can also assist with the processes for obtaining licences and authorisations as the company progresses through implementation and potential operations.
No minimum expenditure is required, the eventual investment value will be determined after research and pilot work and any party can terminate the arrangement on 30 days’ written notice.
ISR Field Test Preparation
Caladão hosts a combined indicated and inferred rare earth mineral resource estimate of 708.6 million tonnes grading 1,443 parts per million total rare earth oxides.
A separate gallium MRE totals 575.68Mt at 37.05ppm, providing a resource context for the proposed extraction and processing studies.
Preparations for the controlled ISR field test include hydrogeological, geotechnical and environmental assessments alongside technical design and other preparatory studies.
Metallurgical work will continue on precipitation and product quality using solutions derived from leaching, while gallium processing research proceeds in parallel.
Axel plans to work with Invest Minas on the specialised regional supply chain ahead of field validation, with commercial-scale feasibility to be assessed after further technical work.
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