Peak Rare Earths
Primary ticker: ASX:PEK
Stage of development: Exploration, Development
Primary minerals: Rare Earths, Phosphate and Fluorspar
Project to promote: Ngualla Project
Project location: Tanzania
Website: peakrareearths.com
Peak Rare Earths is an ASX listed rare earth focused company focused on the development of its Ngualla Rare Earth Project in Tanzania. Once constructed, the Ngualla Project will be a large and low-cost producer of high-grade bastnaesite concentrate which will be used in a range of low carbon technologies that power the green transformation. The broader Ngualla deposit also hosts a range of other critical minerals including phosphate, niobium, and fluorspar which offers significant exploration and development upside.
Cash: AU$7.6M (30 June 2024)
Major shareholders:
Shenghe Resources – 19.9%
Management Ownership – 1%
Financials
Management Profile
Russell Scrimshaw – Executive Chairman
Russell is a distinguished corporate executive and company director with experience in large scale mining project development and operations, product marketing, finance, business development and technology. Russell was a founding director of Fortescue Metals Group and served in executive roles including Deputy CEO and Executive Director. He was a key part of the management team that developed Fortescue’s mining, port and rail operations and was instrumental in establishing Fortescue’s strong relationships with large steel mill groups across a vast Asian customer base.
More recently Russell was Chairman of UK-listed Sirius Minerals PLC (acquired by Anglo American in 2020), which is developing a large Polyhalite fertiliser project in North Yorkshire, in close proximity to Peak’s Teesside refinery site. He has also held senior executive positions at the Commonwealth Bank of Australia and Optus. Russell is currently Chairman of the Garvan Research Foundation, a non-Executive Director of the Garvan Institute of Medical Research and Vice Chairman of Ignition Wealth.
Matthew Horgan – Head of Corporate Development and Investor Relations
Matt holds over 12 years of experience within the mining industry. Matt was most recently at Azure Capital, a boutique investment bank based out of Perth, where Matt worked on several M&A transactions within the metals and mining space. Prior to his role at Azure, Matt spent over nine years at the aluminium company Alcoa where he worked across a number of roles spanning corporate development, strategy, market development and technical (chemical engineering). Prior to departing Alcoa, Matt was manager of global corporate development where he focused on business development initiatives across Southeast Asia.
What is your rationale for taking part in 121 Mining Investment?
Engagement with high quality institutions as well as on market support and potential investment.
What recent news would you like to highlight to investors attending?
24 July 2024 – Shenghe Investment and Funding Term Sheet
21 June 2024 – Offtake Agreement Conditions Precedent Satisfied
26 April 2024 – Enlargement of Special Mining Licence Area at Ngualla
22 April 2024 – Phosphate co-operation and development MOU with Minjingu Mines
What are your key goals in 3 months, 6 months, 12 months?
3 Months:
* Finalisation of Shenghe transaction documentation
* Completion of cost optimisation study (in collaboration with Shenghe)
* Award of EPCM contract
* Potential sale of Teesside site
* Final Investment Decision (FID)
6 Months:
* Commencement of Construction
* Exploration activities (phosphate & fluorspar)
What do you see as the key risks and challenges facing your company at the moment and how are you overcoming these?
– Price risk: Binding offtake agreement in place for 100% of mine output supporting attractive payabilities across the entire pricing cycle
– Funding risk: Full funding solution in place with Shenghe (market cap of US$2.5b) with Peak not required to contribute any additional development equity into the project
– Technical risk: Strong management team and Board with deep experience in African project development, as well as ongoing partnership and collaboration with strategic partner, Shenghe (20+ years experience in rare earth industry)
What do you think makes your company such a compelling investment?
– Compelling NdPr market outlook: Attractive long-term fundamentals for rare earths
– Experienced board and management team: A well-rounded leadership team with a track record in funding and developing projects
– De-risked development strategy: A bankable feasibility study (BFS) update and front-end engineering design (FEED) study have recently been completed
– World class deposit: High-grade, long-life asset with also benefits from very low levels of radionuclides
– Complete offtake solution: A binding take-or-pay offtake agreement with Shenghe for 100% of rare earth concentrate and 50% of any future downstream products
– Attractive mining jurisdiction: Tanzania has a well-established mining sector and a rapidly growing economy
– Exploration upside: The broader Ngualla deposit hosts a range of critical minerals including phosphate, niobium, and fluorspar
What are the top 3 key investor takeaways?
– Attractively valued relative to other rare earth development companies
– Complete integrated solution in place including funding, development and offtake – the only rare earth development company that has a full offtake solution
– Highly supportive partner, Shenghe which has deep experience in the rare earth sector (20+ years). Shenghe previously played a key role in the restart of the Mountain Pass Mine including funding, offtake and technical support – Shenghe still holds a 7.7% stake in MP Materials