08:11 AM EDT, 09/05/2024 (MT Newswires) -- Aclara Resources ( ARAAF ) reported Thursday the results of an updated preliminary economic analysis on its flagship Carina Module clay project in Brazil.

Among highlights, the company cited "robust economics" including an after-tax net present value of US$1.5 billion using an 8% discount rate and base case prices, with a 27% internal rate of return over the 22-year life of mine and a payback period of 4.2 years. It also cited "low" initial capital costs of US$593 million and "low" sustaining capital costs of US$86 million.

The company also cited after-tax NPV of US$2.2 billion using incentive price forecast (excluding Chinese supply).

"These figures underscore the project's status as a high-quality heavy rare earth asset, designed to deliver significant annual dysprosium and terbium production, representing approximately 13% of China's official output in 2023," CEO Ramon Barua said.

Barua added: "The medium to long-term outlook for rare earth elements, particularly heavy rare earths, remains strong due to their global scarcity. Increasing international regulations are enhancing the development of alternative supply chains beyond China, and Argus's incentive price forecast indicates substantial upside potential for rare earths in response to future demand.

"Our focus is now on expediting the path to early production. We have recently signed a Memorandum of Understanding with the State of Goias and Nova Roma Municipality in Brazil as a means to accelerate the permitting process and facilitate the swift implementation of the Carina Module, with the goal of starting production between 2027 and 2028."