Pensana chairman Paul Atherley has reflected on “considerable progress for the company” in its development of the world’s first independent and sustainable magnet metal rare earth processing hub at Saltend.
It came as the company released its 2022 Annual Repor t, building on last week’s investor update. London-listed Pensana has now entered the construction phase for a complex separation plant, a £150 million investment creating 125 highly-skilled jobs in chemical engineering and associated functions.
It will be fed from a mine Pensana is also developing in Angola, Africa, as well as third parties.
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Mr Atherley, who was on site in July, welcoming then Business Secretary Kwasi Kwarteng to join him in the ceremonial groundbreaking, said: “The electrification of motive power is forecast to become the biggest energy transition in history. Two of the biggest components of this transition are the phasing out of internal combustion engines in favour of electric vehicles and the rapid growth of offshore wind, both of which are heavily dependent on powerful rare earth permanent magnets.
“Currently, China supplies over 90 per cent of these magnets and has made it clear that it is going to need all its production for its US$11 trillion 2060 carbon-neutral plan and that it feels under no obligation to supply the rest of the world.
“An additional concern for European and US OEMs is that the current supply from China may not meet their environmental, social and governance (ESG) standards.”
It is claimed highly toxic methods are being used to extract rare earths in some regions, “devastating ecosystems, endangering livelihoods and restricting access to safe drinking water”.
Mr Atherley said: “Pensana is at the forefront of tackling these challenges. By establishing an independent and sustainable supply chain to the highest international standards, we will be able to provide our customers with the assurances they need in terms of supply chain resilience and transparency in terms of ESG.
“An example of this was the recent announcement that Pensana has been selected by Polestar to join its collaboration to produce the world’s first climate-neutral car. The Polestar 0 Project is aiming to develop a climate-neutral supply chain for all its raw materials.”
Other highlights reflected on include the green bond accreditation from Cicero, Norway’s foremost institute for climate research, recognised as a leading provider of independent reviews of sustainability financing frameworks.
Mr Atherley said: “We are seeing increased levels of interest from automotive and offshore wind original equipment manufacturers and are in advanced discussions with a number of parties seeking offtake arrangements. We are also in early discussions with new and existing major magnet manufacturers about becoming part of a realignment of international magnet metal supply chains and have recently signed a memorandum of understanding with a large non-Chinese magnet manufacturer for an offtake of 25 per cent of Pensana’s rare earth oxide production post year-end.
“At the time of writing, we are in the final stages of financing and, despite the current turbulence in the world’s financial markets, we are receiving strong interest and aiming to complete the main financing by the end of quarter four of calendar year 2022.”
Losses after tax for the heavily investing business pre-trade were $10.1 million (£8.7 million), with project expenditure of $20.8 million (£18 million).
As reported, Wood has been appointed as principal contractor with orders placed for long lead time infrastructure.
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