Name of the Project
Phalaborwa Rare Earths Project.

Location
Limpopo, South Africa.

Project Owner/s
London-listed Rainbow Rare Earths, which holds an 85% interest in the project.

Rainbow signed an agreement with Bosveld Phosphates in June 2023 to acquire the remaining 15% interest. Upon completion of the definitive feasibility study (DFS), the unincorporated joint venture (JV) will be transferred into an incorporated JV company and, at Rainbow’s election, Bosveld will transfer the assets required for the project into that company.

Project Description
The near-term rare earths development project is based on the recovery of rare-earth elements (REEs) from phosphogypsum stacks generated from historic phosphate hard-rock mining by Foskor, which then sold a concentrated phosphate slurry to Sasol (the last major operator of the site), which, in turn, fed a phosphoric-acid production facility. Phosphoric acid is a key ingredient required for the manufacture and/or production of fertiliser. The project has a Joint Ore Reserves Committee-compliant mineral resource estimate of 35-million tonnes at 0.44% total rare-earth oxides (TREO), contained in two unconsolidated phosphogypsum stacks.

The project is being developed as a chemical processing operation on a brownfields chemical site without any mining. Rainbow has said the resource is already at surface and is in a chemically cracked form, which eliminates the need for hard-rock mining, crushing, milling, flotation and cracking – all characteristics of a hard-rock rare earths mining project. This is expected to give Phalaborwa a lower operating-cost profile and a much lower capital intensity than those of traditional rare earths mining projects.

An updated interim economic study, released in December 2024, proposed a 16-year project life, based on the processing of an average of 2.2-million tonnes of phosphogypsum a year. The overall recovery rate is estimated at about 65%. The project is expected to produce about 1 850 t/y of separated neodymium/praseodymium (NdPr) oxides, as well as about 80 t/y of dysprosium and terbium, and about 140 t/y of yttrium within a samarium, europium and gadolinium-plus (SEG+) mixed rare-earth carbonate.

Rainbow’s process flowsheet provides for mechanical reclamation of the gypsum, followed by hydrometallurgical processing to recover the rare earths and produce a high-grade mixed rare earth product (MREP) for solvent extraction (SX) separation. Rainbow has selected SX as the final separation route. The company expects to produce separated NdPr oxide and an SEG+ mixed rare-earth carbonate, which will include dysprosium, terbium, samarium, europium, gadolinium and yttrium.

The flowsheet has been simplified through optimisation work, including the reduction of the leach process from three stages to two, and a reduction in residence time from 32 hours to eight hours, by increasing leach-heating requirements. Rainbow has also incorporated a purification process combining continuous ion-exchange and precipitation steps, as well as cerium depletion, to produce a high-grade feed stream for separation.

Phalaborwa is also expected to have environmental benefits, as the project will serve to clean up a legacy environmental issue of acid water associated with the historic unlined gypsum stacks. Rainbow will use this water source in the closed-circuit process plant, which is also expected to minimise the need to draw on an external water source for the processing plant. The clean gypsum by-product will be deposited on newly lined stacks designed to International Finance Corporation and Equator Principles standards, with the plan to be sold into agricultural and industrial markets over time.

Potential Job Creation
Not disclosed in the interim study.

Net Present Value/Internal Rate of Return
The December 2024 interim economic study estimated an after-tax net present value, at a 10% discount rate, of $610.9-million, an after-tax internal rate of return of 38% and a payback period of two years. Average earnings before interest, taxes, depreciation and amortisation are estimated at $180-million a year over the 16-year project life.

Capital Expenditure
Capital costs are estimated at $326.1-million.

Planned Start/End Date
Rainbow expects to publish the DFS by the end of 2026. On completion of the DFS, final permitting is expected to run in parallel with the project-finance process, allowing for construction to start by the end of 2027. First production is targeted for the end of 2028 or the first quarter of 2029, subject to completion of the DFS, permitting and financing.

Latest Developments
Rainbow reported in its interim results, published on March 31, 2026, that Phalaborwa had been established as a proven producer of REE, with the large-scale pilot plant in Johannesburg running the optimised primary flowsheet and producing a high-grade mixed rare-earth product (MREP).

The pilot plant initially produced a 55% TREO high-purity mixed rare-earth hydroxide, with subsequent optimisations delivering a 78% TREO product. Rainbow expects the pilot plant data to underpin the DFS, including mass balance, equipment sizing, and capital and operating costs, as well as third-party validation for project finance.

The company remains focused on delivering the DFS for Phalaborwa in 2026. Rainbow completed an equity subscription on March 31, 2026, raising about $14.6-million from strategic investors, consequently providing funds to complete the Phalaborwa DFS, the prefeasibility study for the Uberaba project, in Brazil, and general working capital beyond the end of the second quarter of 2027.

On May 5, 2026, Rainbow announced that it was evaluating a potential US stock exchange listing. The company said its core priorities remained the delivery of the Phalaborwa DFS in 2026 and the start of a prefeasibility study at Uberaba. Rainbow also noted continued support from the US International Development Finance Corporation, which has a $50-million option to provide project equity financing for Phalaborwa through strategic shareholder TechMet.

Key Contracts, Suppliers and Consultants
ANSTO Minerals (SX modelling and mineral testwork); K-Tech Ip for separation – CIC has been replaced by SX K-Tech Inc (REO separation technology and back-end pilot plant work); Mintek (pilot plant and front-end testwork in South Africa); METC Engineering (PEA and DFS engineering work); NEXUS Intertrade (letter of intent for benign gypsum offtake); and LCM (strategic supply agreement for magnet REE offtake).

Contact Details for Project Information
Rainbow Rare Earths investor relations, Cathy Malins, tel +44 7876 796 629 or email cathym@rainbowrareearths.com. 
Tavistock Communications, on behalf of Rainbow Rare Earths, tel +44 20 7920 3150 or email rainbowrareearths@tavistock.co.uk.