Rainbow Rare Earths has signed a memorandum of understanding (MoU) with Neo Performance Materials covering technical support, design input and offtake for its Phalaborwa project in South Africa.
Under the agreement, Neo will provide technical support and design input for Phalaborwa’s final solvent extraction (SX) separation circuit, using its SX technology.
The planned circuit is expected to produce separated neodymium-praseodymium oxide at more than 99% purity, alongside a mixed SEG+ heavy rare earth carbonate containing dysprosium, terbium and other heavy rare earth elements (REEs) for further separation at Neo’s facilities.
According to Rainbow, Neo was selected after a comprehensive competitive process and technical due diligence on the project.
Neo is a rare earth separation technology specialist with operating and technical experience across multiple commercial facilities.
Under the MoU, Neo will receive rights to 40% of annual separated neodymium-praseodymium oxide output and 65% of annual mixed SEG+ carbonate production.
Pricing will be set on arms-length commercial terms using relevant rare earth price indices.
The parties will also consider toll treatment for the remaining SEG+, enabling Rainbow to market the balance of its separated dysprosium, terbium and yttrium.
Technical test work using Rainbow’s high-grade rare earth solution is under way at Neo’s facilities in Estonia.
Rainbow and Neo are progressing binding long-form agreements while the test work continues.
After the Estonian work, Neo is expected to help run a confirmatory integrated pilot-scale SX plant in Johannesburg, South Africa, to support the definitive feasibility study (DFS). Completion of the DFS is currently scheduled for the first half of 2027.
Rainbow plans to publish a pre-feasibility study (PFS) in the fourth quarter of 2026, incorporating initial SX test work and providing an interim update on Phalaborwa’s economics, the first since a December 2024 Interim Study.
The company said the study will define the final product, process and waste streams with sufficient certainty to advance financing and permitting.
The PFS is intended to support project financing and permitting workstreams within the wider development timeline.
Rainbow CEO George Bennett said: “Finalising our technology partner for the SX separation process was the remaining step required to complete the definition of our process to extract REEs from phosphogypsum waste.
“We are delighted that Neo has agreed to partner with us – their deep understanding and experience in rare earth separation and magnet materials is invaluable.”
