Aclara Resources Inc (TSX:ARA, OTC:ARAAF) released an updated Preliminary Economic Analysis for its Carina rare earth project in Brazil that showcased a US$1.5 billion net present value.
The report confirmed the economic potential of the regolith-hosted ion adsorption clay project, Aclara told shareholders.
According to the new PEA, Carina Module has an after-tax Net Present Value (NPV) of approximately US$1.5 billion using an 8% discount rate, and an internal rate of return (IRR) of 27% over the 22-year mine life.
Initial capital costs are estimated at US$593 million, with low sustaining costs of US$86 million.
The project is forecast to generate US$505 million in annual net revenue and US$366 million in EBITDA.
The PEA also highlights potential upside in the project's valuation, estimating an NPV of US$2.2 billion under Argus Media's incentive price forecast, driven by regulations promoting critical raw materials like the European Critical Raw Materials Act and the US Inflation Reduction Act.
The project is set for commissioning by 2029, though Aclara is evaluating a faster production schedule for 2027 to 2028. Additionally, Aclara has secured a Memorandum of Understanding with local authorities to accelerate permitting.
Aclara's CEO, Ramon Barua, noted that the Carina Module's production of heavy rare earth elements (REEs) such as dysprosium (Dy) and terbium (Tb), essential for clean energy technologies, positions the company to meet growing global demand.
“Our focus is now on expediting the path to early production,” Barua said in a statement.
The CEO also emphasized the project's strategic importance as international supply chains seek alternatives beyond China.
Aclara's environmentally focused extraction process minimizes its ecological footprint by avoiding explosives and milling, recycling 95% of water, and using common fertilizers, with no liquid residues requiring tailings dams.
Aclara plans further drilling and metallurgical studies in 2024-2025 to support a prefeasibility study and pilot plant construction.
The Carina Module is part of Aclara’s rare earth portfolio, which includes the Penco Module in Chile and a US-based subsidiary, Aclara Technologies Inc.