USA Rare Earth (NASDAQ:USAR) has executed definitive agreements with the US Department of Commerce for a total of US$1.6 billion ($2.2 billion) in funding under the Department’s CHIPS (Creating Helpful Incentives to Produce Semiconductors) Program.
The agreements comprise up to US$277 million in federal funding, with up to US$1.3 billion in senior secured loans, with distribution tied to project milestones.
These definitive agreements, together with the US$1.5 billion in private capital raised in January 2026, will enable USA Rare Earth to continue the build-out of its integrated heavy rare earth mining, metal, and magnet facilities.
Chairman Michael Blitzer says that the company’s coordination and partnership with the US Government is what’s needed to acquire the necessary capital to build out its light and heavy rare earths platform.
“This landmark collaboration reflects the scale and urgency of securing critical supply chains for technologies essential to long-term economic growth,” Blitzer says.
“We are grateful for the leadership shown across the government in moving with speed and conviction.”
CEO Barbara Humpton also notes the historic milestone as the company moves from “intent to execution alongside the US Government”.
“With the definitive agreements, USAR is positioned to accelerate the building of a global mine-to-magnet value chain that will supply the materials, metals, and magnets that industrial customers depend upon.
“From defence, aerospace, semiconductors, and data centres to physical AI (artificial intelligence), energy, mobility, and healthcare, our integrated value chain is designed to power the technology and innovations of the 21st century.”
The definitive agreements cover USA Rare Earth’s entire integrated value chain, which is targeted to be fully operational by 2030. The agreements will support the development of the Round Top Project’s heavy rare earth and critical mineral deposit in Texas, which is slated for commercial production in 2028.
They are also supporting the processing and separation of Round Top output, which includes heavy rare earth elements and other critical mineral oxides and concentrates.
The funding will also support the reshoring of 10,000 tonnes per annum of heavy rare earth element metal-making, alloy-making, and strip-casting capacity through the company’s subsidiary Less Common Metals, as well as the scaling of the neodymium-iron-boron magnet manufacturing capacity in Oklahoma and South Carolina.
USA Rare Earth is building a fully integrated rare earth and permanent magnet value chain across the US, UK, France, and Brazil.
Write to Amy Rotman at Mining.com.au
Images: USA Rare Earth
