Lynas Rare Earths’ subsidiary Lynas USA has secured a follow-on contract from the US Department of Defense (DoD) to build a heavy rare earths facility in Texas.

Under the contract, the US DoD has updated its contribution to $258m to build the heavy rare earths component of Lynas’ rare earths processing facility, an increase from the previously announced $120m contribution.

In a press statement, Lynas said: “The updated contract is an expenditure-based contract under which all of Lynas’ properly allocable construction costs will be reimbursed.”

Lynas said the latest updated contract follows detailed design work for the project and its cost updates.

The contract is supported by the US Government’s Industrial Base Analysis and Sustainment programme to help strengthen the country’s rare earth supply chain development.

Upon completion, the project is expected to be the only scale producer of separated heavy rare earths outside of China.

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By GlobalData

Lynas said it has purchased a 149-acre greenfield site in Seadrift, Texas, for the planned heavy rare earths facility, which will be co-located with a light rare earths separation plant.

The site will also allow for potential growth opportunities in the future with regard to downstream processing and recycling.

Lynas’ Texas facility is expected to strengthen the supply chain for responsibly produced rare earths in the US.

Lynas Rare Earths CEO and managing director Amanda Lacaze said: “We are delighted to work with the US DoD to deliver our US heavy rare earths separation plant in Texas, which is a key pillar of Lynas’ growth strategy.

“This further support by the DoD demonstrates the priority being given to developing robust and resilient rare earth supply chains.”