Arafura Rare Earths obtained US$1.3Bn in debt funding for the Nolans project in Northern Territory, Australia. The funding is backed by agencies in Canada, Germany, South Korea, and commercial lenders. 

Arafura Rare Earths has completed its debt financing for the Nolans project, which involves developing both mining and refining infrastructure in the Northern Territory, Australia. The company obtained conditional approval for up to US$775M of senior debt finance facilities including Export Finance Australia, Northern Australia Infrastructure Facility, Export Development Canada and The Export-Import Bank of Korea (KEXIM), supplementing an existing US$550M debt package approved earlier this year in March 2024 from Critical Minerals Facility, revamped Northern Australia Infrastructure Facility and federal export financing. These debt packages, amounting to over US$1.3Bn, include a US$80M cost overrun facility and a subordinated standby liquidity facility of US$200M, designed to cover pre-production capital costs.   

The funding is underpinned by support from international agencies in Canada, Germany, South Korea, and various commercial lenders. Notably, this includes US$150M from KEXIM and up to US$533M from the Australian government, of which US$200M is provided under the Critical Minerals Facility. The financial backing highlights the global significance of the Nolans project in the supply chain of critical minerals essential for advanced technologies and sustainable development. 

This funding is notable for its absence of Chinese investors, which is a departure from the trend seen in recent transactions. Chinese-backed companies have recently invested in projects such as Peak Rare Earths' Ngualla project in Tanzania and the Hastings Rare Earths' Yangibana project in Australia. In response, governments such as South Korea, Canada, Germany, and the USA are embarking on collaborative funding initiatives to mitigate Chinese dominance by diversifying the global supply chains for rare earth elements. These efforts are driven by concerns over supply stability, geopolitical tensions, and the strategic vulnerabilities associated with heavy reliance on Chinese sources for critical materials.