The American company USA Rare Earth will receive large-scale government support. The allocated funds will be used to create a full production cycle in the country rare earth elements and permanent magnets.
The United States government has approved a major investment package for USA Rare Earth. The $1.6 billion in support includes both direct financing and debt funds. As part of the agreement, the US Department of Commerce will acquire a 10% stake in the company.
The main purpose of the financing is the construction of two key facilities: a mine in Texas and a magnet production facility in Oklahoma. The components produced are critical for high-tech and defense industries, including the production of electric vehicles, electronics and aerospace engineering.
The investments are being made under the amended CHIPS Act program, which now covers projects in the strategic raw materials sector. Of the total, $277 million is direct appropriations and $1.3 billion is debt financing.
Unlike some previous agreements, this deal does not provide for the establishment of a guaranteed minimum price for future products. The company will operate on the open market.
In parallel with the government investment, USA Rare Earth conducted a private placement of shares, raising an additional $1.5 billion. The total amount of capital for the project exceeds $3 billion.
This decision reflects the administration’s commitment to active participation in development of the national raw material base. USA Rare Earth’s funding is a strategic move aimed at building foreign-independent supply chains for the high-tech industry.
Source: Mining Weekly
Image: Mining Weekly
