Rare Element Resources Secures Major Approval for New Plant
Rare Element Resources Achieves Significant Operations Milestone
Rare Element Resources Ltd. (the “Company” or “RER”) (OTCQB: REEMF) is excited to share that the U.S. Department of Energy (DOE) has approved both the operations budget and the readiness plan for its rare earth processing and separation demonstration plant. This important Project Continuation Notice allows the Company to commence operations following approval from the U.S. Nuclear Regulatory Commission (NRC). The Company expects this approval in the coming weeks, with operations projected to start in the fourth quarter of 2024.
Preparation for Operations Phase
Team Efforts and Project Readiness
Ken Mushinski, President and CEO of RER, highlighted the strategic preparations made over recent months. These preparations involved extensive collaboration with the project team and contractors to ensure the site is operationally ready. The Company has partnered with Wood plc, based in Gillette, Wyoming, to develop a staffing plan that aligns with the upcoming operational phase. The transition to operations signifies a pivotal step toward demonstrating RER's innovative technology for rare earth recovery.
Funding and Budget Updates
Cost-Share Budget Revision
In conjunction with the operations approval, the DOE has also approved a budget increase for the project, now totaling approximately $53.6 million. The federal cost-share allocation has risen by 10%, escalating from approximately $21.8 million to roughly $24.2 million. RER anticipates that the overall project costs will exceed this budget as it progresses, impacted by supply chain disruptions and inflation, along with necessary design refinements throughout the project’s lifecycle.
Addressing Challenges in Project Development
Importance of Effective Management
Ken Mushinski remarked on the complexities faced during the project's development, specifically highlighting the extraordinary measures taken to manage costs effectively amid economic fluctuations. RER appreciates the DOE's acknowledgment of the project's importance to the U.S. supply chain and its commitment to providing additional cost-share funds to help mitigate rising project costs. As RER shifts its focus towards operational activities, it remains dedicated to prudent cost and schedule management.
Upcoming Steps for the Demonstration Plant
Operational Transition and Expectations
In the forthcoming weeks, RER anticipates receiving NRC operations approval, following which the onsite construction teams will be replaced by operational staff, comprising about 20 full-time positions. This transition is crucial as the Company prepares to form a fully functional operational team.
Rare Element Resources' Vision
Rare Element Resources Ltd. is committed to becoming a leading strategic materials company specializing in the delivery of rare earth products applicable in sectors such as technology, energy, and defense. The advancements related to the Bear Lodge Rare Earth Project highlight the Company’s focus on harnessing rare earth resources crucial for modern technologies, including electric vehicles and renewable energy systems.
Frequently Asked Questions
What is the significance of the DOE’s operations approval?
The DOE’s operations approval is a vital milestone for RER, allowing the Company to commence operations at its demonstration plant and advance its rare earth recovery technology.
What are the expected outcomes from the demonstration plant?
The demonstration plant aims to generate operational and economic data critical for developing a commercial-scale plant capable of producing rare earth materials.
How is RER addressing the increased project costs?
RER is utilizing existing funds to cover costs exceeding the approved DOE budget and actively seeking additional funding sources to manage financial pressures.
What role does the staffing contractor play in this project?
Wood plc is responsible for preparing a staffing roster essential for running the demonstration plant efficiently and effectively under RER's guidance.
What technologies rely on rare earth products?
Rare earth products are crucial for multiple technologies, including electric vehicles, solar panels, wind turbines, high-strength magnets, and laser systems used in medical technology.
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