Equinox Resources (ASX:EQN)
, a leading diversified global resources company, has announced its latest strategic move to establish dominance in Brazil's rare earths sector. The company has submitted strategic pegging applications for approximately 1,760 square kilometers of rare earth tenements in Bahia State, northeast Brazil. This marks a significant step forward in Equinox's growth strategy, positioning it as a key player in the clay-hosted rare earths supply chain.
The newly defined "Campo Grande" Rare Earths Project, located in a rapidly emerging rare earths province in Bahia State, Brazil, is strategically situated near the Rocha da Rocha Rare Earths Project, currently held by Brazilian Rare Earths Limited (BRE). The Rocha da Rocha Project boasts an impressive JORC Resource Estimate of 510.3 million tons at 1,513 parts per million Total Rare Earth Oxide (TREO).
Brazilian Rare Earths Limited is in the midst of a $50 million Initial Public Offering (IPO) on the ASX, with an expected market capitalisation of approximately $315 million (based on the IPO issue price and assuming full subscription). Equinox's move to establish the Campo Grande Project aligns with its broader strategy as a diversified global resources company, complementing its advanced iron ore assets in Western Australia and lithium assets in Canada.
Equinox's CEO, Zac Komur, expressed his enthusiasm for the Campo Grande Project, stating, "The Campo Grande Project represents an outstanding and potentially game-changing growth opportunity for Equinox, located in the heart of one of the world's most exciting emerging districts for clay-hosted rare earths discoveries. The staking of these highly strategic tenements represents the culmination of an extensive review of potential business development opportunities in Brazil, including time on the ground visiting prospective tenements. I am thrilled that we’ve secured this opportunity for our shareholders."
The decision to submit the Campo Grande tenements application was made after a meticulous assessment of the available ground, which revealed compelling potential for the discovery of additional ionic clay-hosted rare earths deposits. Equinox is poised to become the largest tenement holder within the province once the applications are granted.
Clay-hosted rare earths are in high demand for the green energy transition due to their less capital-intensive mining and processing requirements, as well as their environmentally friendly outcomes compared to traditional hard rock deposits.
Furthermore, Brazil offers a premier mining jurisdiction with a rich resource base, extensive high-quality infrastructure, and a supportive legislative regime. Equinox plans to kickstart an auger drilling program in early 2024 following the expected granting of the applications, further solidifying its position as a major player in the global rare earths supply chain.
Equinox Resources Limited's strategic placement is set to raise $1.6 million before expenses, with directors committing $465,000 to support the company's growth endeavors. This move underscores Equinox's commitment to expanding its presence in the rare earths market and contributing to the global shift towards sustainable energy solutions.