Australian Rare Earths (ASX:AR3) has finalised and signed a deal with the Australian Government for a $5 million grant to advance the Koppamurra Rare Earths Project on the border of South Australia and Victoria.
The company has already received $750,000 of the grant as an initial instalment, with the remaining funds to be received upon periodic progress updates.
Funding will support additional metallurgical testwork, completing a Prefeasibility Study, alongside constructing and operating a demonstration plant to advance the project, as well as derisk the development pathway.
All of the activities are expected to be completed by the end of 2026, with an agreement end date of 9 June 2027.
Under the federal government’s International Partnership in Critical Minerals Program, established at the end of 2024, up to $40 million will be provided in grants across eight projects.
The projects funded under the program will build Australia’s sovereign capability in critical minerals processing and support critical minerals projects of mutual interest to international partners.
Australian Rare Earths, which has a market capitalisation of $15.58 million, will match the $5 million grant. This brings the total planned expenditure to $10 million spread over the next two years.
A portion of the matched funding may be eligible for the Australian Government’s research and development tax incentive refundable tax offset.
The company says the grant validates Koppamurra’s potential and its strategic importance in building diverse, resilient, and sustainable supply chains.
The Koppamurra Project has all four key rare earths — praseodymium, neodymium, terbium, and dysprosium — which is considered important for producing rare earth permanent magnets. The project has a resource of 186 million tonnes at 712 parts per million total rare earth oxide.
Australian Rare Earths is an explorer and developer focused primarily on its wholly owned Koppamurra Project located in southeastern South Australia and western Victoria. The project is a prospective ionic clay-hosted rare earth deposit.
Write to Aaliyah Rogan at Mining.com.au
Images: Australian Rare Earths
