Stellantis and NioCorp sign rare earth offtake term sheet; possible strategic investment by Stellantis

Stellantis N.V. and NioCorp Developments Ltd. have signed a rare earth offtake term sheet. The objective is to enter into a definitive rare earth supply agreement to support Stellantis’ commitment to build resilient supply chains and reach carbon net zero by 2038 and to help accelerate NioCorp’s path to commercial production of magnetic rare earth oxides in the US.

NioCorp is developing North America’s only niobium / scandium / titanium advanced materials manufacturing facility co-located with an underground mine. The company says that Elk Creek also contains the second-largest indicated rare earth resource in the US, after Mountain Pass.

As no economic analysis has been completed on the rare earth mineral resource comprising the Elk Creek Project, further studies are required before determining whether extraction of rare earth elements can be reasonably justified and is economically viable after taking account of all relevant factors.

The entrance into a binding off-take agreement is subject to the satisfactory completion of due diligence, the negotiation and settlement of final terms, the negotiation of definitive documentation, and customary closing conditions, including regulatory approvals. There can be no assurance that any binding agreement will be entered into on the terms described herein or at all.

NioCorp is currently conducting technical and economic analyses on the potential addition of magnetic rare earth oxides to its planned product suite.

The Elk Creek Project is centered within one 640-acre section of all private land 105 km southeast of Lincoln, Nebraska. According to NioCorp’s June 2022 Feasibility Study, the Elk Creek Project is expected to produce the following over its 38-year operating life:

• Ferroniobium (FeNb): An average of 7,348 tonnes per annum (tpa) of ferroniobium, a crucial component in high strength, low-alloy (HSLA) steel that is increasingly used in bridges and other large infrastructure projects, as well as in high-pressure oil and gas pipelines, steel-chassis vehicles, commercial aviation, aerospace, defense systems, and in many other applications. Niobium also is a component of superalloys used in nearly all jet engines and power generation turbines.

• Scandium Trioxide (Sc₂O₃): An average of 102 tpa of scandium trioxide. Scandium has important uses in environmentally preferred Solid Oxide Fuel Cells, as well as in ultra-high-performance aluminum alloys. Scandium greatly strengthens aluminum alloys and allows them to be reliably welded, which presents revolutionary potential for the commercial airline industry. For example, between $1.0-$1.5 million of scandium oxide in a single airliner offers $21-27 million in net present value fuel savings.

• Titanium Dioxide (TiO₂): An average of 12,063 tpa of titanium dioxide. Titanium has the highest strength-to-density ratio of any metallic element, and it is used in wide variety of sectors, including aerospace, national defense, chemical processing, desalination, automotive, health care, communications, sporting goods, and many others. Titanium in its oxide form also is used in the manufacture of pigments in paints, plastics and paper, and is a photocatalyst.

• Rare Earths. NioCorp is currently conducting technical and economic analyses on the potential addition of magnetic rare earth oxides to its planned product suite. Potential rare earth focus: Magnetic Rare Earth Oxides (NdPr) and Heavy Rare Earth Oxides (Dysprosium, Terbium).