Astron and Energy Fuels partner to unlock western Victoria’s REE and mineral sands potential

Astron Corporation (ASX: ATR) has executed binding agreements with leading US uranium and vanadium producer Energy Fuels to develop the Donald rare earth elements (REE) and mineral sands project in western Victoria.

Under the joint venture agreement, Energy Fuels will contribute $183 million to the development of the Phase 1 Project and will issue Astron $26.1m of its NYSE-listed shares.

Energy Fuels will immediately assume responsibility for funding 100% of the project’s expenditure by way of an interest-free loan to the joint venture (JV) company that will be converted to equity in the JV as part of Energy Fuels’ contribution, upon satisfaction of the conditions precedent.

Energy Fuels may earn a 49% interest in the JV upon completion of its farm-in obligation while Astron, with a 51% interest, will manage the operation.

Long-life source

Astron managing director Tiger Brown said the agreement underpins the development of Donald as a major new long-life source of critical minerals that will generate an REE value chain aligned with the Australian government’s critical minerals strategy.

“The execution of this agreement represents a transformational moment in our company’s history,” Mr Brown said.

“In Energy Fuels, we have found a JV partner that shares our values, our goals and focus, one that strongly complements our mineral sands experience and aspirations with their own REE experience and strategy.”

“We look forward to a long and productive relationship with our new partner to collectively bring to life what, in Donald, is one of the world’s most significant critical mineral resources and deliver value to our respective securityholders and stakeholders.”

Offtake agreement

The JV includes an offtake agreement with Energy Fuels for 100% of the REE concentrate produced from phases 1 and 2 of the Donald project, over an indicative period of 58 years.

Energy Fuels’ president and chief executive officer Mark Chalmers said Donald has the makings of a world-class REE and critical mineral deposit.

“Our JV plans with Astron and the timing of the Donald Project development could not be better,” said Mr Chalmers.

“It fits very nicely with the sequencing of our ‘US Critical Mineral Hub’ initiative, which includes advancing our REE and heavy mineral sand production.”

White Mesa mill

Energy Fuels is currently completing final commissioning of the phase 1 REE separation circuit at its White Mesa mill in Utah.

White Mesa has a commercial REE processing capacity of up to 10,000 tonnes per year.

Mr Chalmers said Donald phase 1 could provide up to 80% of the feed for that circuit in the 2026/27 time period.

“We are also currently in the process of designing and permitting our phase 2 and 3 REE separation circuits at the mill, which are expected to increase our REE concentrate processing capacity in future years between four- and six-fold including the addition of separated heavy REE oxide production in the 2027/28 time period.”

“This would tie nicely into the timing of the planned development of Phase 2 of the Donald project.”

‘Flagship’ project

The Donald phase 2 development could provide up to 35% of the planned increased REE processing capacity at the mill starting as early as 2029.

“These milestones, if achieved, would make the venture significant by any standard,” Mr Chalmers said.

“We believe the Donald project will be a ‘flagship’ mining project for Australia, the State of Victoria and the USA, producing many of the REE raw materials needed for the energy transition perfectly aligned with the critical mineral objectives of both countries.”