[Gettyimages Bank]
Rare earths are used in the creation of neodymium-iron-boron (NdFeB) permanent magnets. The strong magnets are key parts of electric vehicle powertrains, wind turbines, smartphones and other precision equipment. Australia is the world's fourth-largest producer of rare earths. China is the biggest with a 57.7 percent share of global production, according to global market research firm Statistica.
A consortium of South Korean private equity investors -- ACE Equity Partners LLC, Kamur Partners LLC and Cerritos Holdings -- has signed a framework agreement with Australian Strategic Materials (ASM) to establish a $250 million fund and secure a 20 percent equity stake in ASM's rare earths and critical metals project in Dubbo, some 347 kilometers (216 miles) north of Canberra.
"We are very proud to be associated with this strategically important project that will give rise to significant upstream and downstream benefits for both Korea and Australia, ushering in new opportunities for Korean manufacturing," ASM's managing director David Woodall said in a statement on July 21.
The agreement also includes provision for a ten-year offtake agreement for up to 2,800 tons per annum (TPA) of NdFeB NdFeB alloy from an ASM plant that is under construction in Ochang some 100 kilometers south of Seoul. The plant will operate, based on ASM's metallization process that converts oxides into high purity metals, alloys and powders using less energy.
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