Critical Metals’ Tanbreez REE in Greenland on track

Critical Metals (Nasdaq: CRML) says the feasibility study for its proposed 425,000-tonne-a-year rare earth operation in southern Greenland is now 70% complete, placing it on track for submission in this year’s fourth quarter.

An updated Tanbreez exploration licence application is to be submitted to Greenland authorities upon the study’s completion. It’s a key step, Critical Metals said Tuesday, towards final approval for commercial mining at one of the biggest rare earth projects globally.

The study and the completion of baseline sampling represent a “major milestone” for unlocking Tanbreez’s full potential, Critical Metals executive chairman Tony Sage said in a release. 

Tanbreez, made up of the Fjord and Hill zone deposits, hosts 25.4 million indicated tonnes grading 0.37% total rare earth oxides (TREO) and 19.5 million inferred tonnes at 0.39% TREO, according to a preliminary economic assessment from March. About 27% are categorized as heavy rare earths, which are highly sought after by Western suppliers for their use in clean energy, defence and other high-tech applications.

Shares in Critical Metals gained 3.9% to $6.04 on Wednesday morning in New York, erasing the previous day’s 3% loss in spite of the study update. The New York-based company has a market capitalization of $595 million.

Expanding ressource

A 2,000-metre drilling program this year is aimed at expanding the resource ahead of the study submission. The drilling will focus solely on the eudialyte component of Tanbreez mineralization found on the Fjord deposit, which accounts for about half of the resource.

The final study stage will include the completion of mine design and process plant engineering, tailings management and water treatment strategies, and integration of environmental and regulatory inputs.

The project has an estimated net present value of about $3.04 billion (C$4.1 billion) or about $2.8 billion to $3.6 billion at discount rates of 15% and 12.5%, respectively, before tax; with an internal rate of return of 180%, according to the March economic report. 

That report outlined a staged growth strategy for Tanbreez, targeting production of around 85,000 tonnes of rare earth oxides per year, beginning as early as 2026, then potentially rising to 425,000 tonnes a year after modular expansion. The first buyer of its mixed rare earth products will be Ucore Rare Metals (TSXV: UCU), which will process them at its new facility in Louisiana under a newly signed offtake agreement.