Phalaborwa, South Africa — Two massive sand dunes are located at an old chemical processing plant in South Africa, and are at the heart of a US-backed exploration project to extract… Rare earth elements From industrial mining waste.
The Phalaborwa Rare Earths Project is supported by US government equity investment of $50 million International Development Finance Corporation It is part of the accelerated American efforts to achieve this – Reducing dependence on its economic competitor, China For minerals necessary to make electronic devices, robotics, defense systems, electric vehicles and other high-tech products.
Countries have identified dozens of minerals, including copper, cobalt, lithium and nickel, as critical because they are essential for new technologies. The seventeen rare earth elements are a subset of it.
President Donald Trump has made expanding U.S. access to critical minerals, including rare earth elements, a central policy of U.S. policy Anti-China. The Trump administration said this year it would allocate nearly $12 billion to create its own program Strategic reserve.
DFC was established during the first Trump administration and committed its investment in the Phalaborwa project in 2023 under former US President Joe Biden.
The current Trump administration has gone ahead with the project though A major diplomatic dispute With South Africa, which began when Trump returned to office and issued an executive order last February halting all financial aid to the country.
But the administration has shown that some economic concerns come first. The Forces of Freedom Declaration has touted its participation in the Phalaborwa project as part of a campaign to unleash Africa’s mineral potential “while advancing the strategic interests of the United States.”
The Phalaborwa project is being developed by Rainbow Rare Earths. The DFC is investing through its partner TechMet, a company that says it is focused on securing vital mineral supplies for the West. The South African government has no direct stake in the project.
George Bennett, CEO of Rainbow Rare Earths, told The Associated Press they hope to supply primarily the United States, saying its interest in the project is largely related to defense systems.
The company says it aims to supply rare earth elements such as neodymium, praseodymium, dysprosium, terbium and others from its project in South Africa. They are used in high-performance magnets in wind turbines, electric vehicles, defense and emerging applications, including robotics.
The Phalaborwa project aims to start extracting rare earths from the massive sand dunes in 2028. The dunes consist of 35 million tons of phosphogypsum, a byproduct of mining waste and the processing of phosphate rock to produce acids and fertilisers.
Rainbow Rare Earths said the project is expected to last 16 years. The $50 million from DFC will only be used when Rainbow Rare Earths begins construction of its processing plant in Phalaborwa, expected in early 2027.
Rare earth elements are relatively common but are usually found in low concentrations and are difficult to separate, making them expensive to mine.
Neha Mukherjee, research director at Benchmark Mineral Intelligence, said that although the Phalaborwa project was unique, with its experimental above-ground mineral extraction process, its potential was still unknown.
“It appears to be a fairly low-cost asset in terms of operational cost,” she said. “Even the capital requirements are not too high…which is a good sign.”
Mukherjee added that the project is important because “we do not have enough projects to fully meet the demand outside China.”
Rainbow Rare Earths says extracting minerals from the sand dunes will use up to 90% renewable energy and will be much less expensive than typical rare earth mining.
Bennett said Phalaborwa would be a low-cost product compared to Chinese producers.
“(The previous owners) crushed it, ground it, put energy into it, put heat into it, all to make phosphogypsum, which is what we need to make rare earths,” said Rainbow Rare Earths project manager Alberto Protomeso, referring to the processes the waste had previously undergone. “Heating is the most expensive part of the process. It’s what costs the most money.”
The Trump administration has also invested in it Mining of critical minerals in the United States Deals have continued to secure access to these minerals abroad, including… In Ukraine. Greenland Rare earths It’s part of the reason why Trump wants to seize the Arctic island.
The Phalaborwa project is one of several mineral projects in Africa with DFC investments.
Patience Musosa, a mining specialist at the North Africa Institute in Sweden, said the United States is “trying to catch up in terms of mining investment” on the African continent, where China is the dominant player in mining.
In February, the US Trade and Development Agency signed a formal agreement to provide $1.8 million for a feasibility study of the Monte Mwambe rare earths project in Mozambique.
In Africa, the Trump administration is also continuing US financial support for Africa Lobito Passthe Biden administration’s initiative to build an 800-mile (1,290-kilometer) rail line connecting… Mineral-rich areas in the Congo And Zambia to the Atlantic coast of Africa.