Peak Resources has served notice to exercise its option for a 250-year lease from Homes England over a 19-hectare parcel of land within the Wilton International Site located near the town of Middlesbrough.
Peak intends to construct its Teesside Refinery on the site to receive high-grade rare earth concentrate from its planned Ngualla Rare Earth Project in Tanzania, which will produce Neodymium Praseodymium Oxide and other separated rare earth products that are critical for electric vehicles and renewable energy technologies.
The construction of the Teesside Refinery is intended to occur in parallel with the development of Ngualla.
The development of the Teesside Refinery is central to Peak’s strategy of becoming the second fully integrated producer of NdPr Oxide outside of China.
Peak will pay an upfront amount of GBP1,858,712 to exercise its option over the Teesside Refinery site, with annual rent structured as a nominal peppercorn payment. Consideration will be funded from Peak’s existing cash reserves and execution of the long-term lease is expected to occur by mid-June 2021.
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Construction and development of the Teesside Refinery is expected to cost approximately US$160 million and create around 130 long-term jobs.
An Environmental Permit for the project was granted in August 2018 and Planning Permission from Redcar & Cleveland Borough Council was implemented in April 2021.
The Teesside Refinery site is located with the Teesside designated Freeport area. Following recent announcements by the UK Government, freeport areas are expected to benefit from lower tariffs and customs charges, simplified customs procedures, streamlined planning processes, tax breaks to encourage investment and government support to promote regeneration and innovation.
Development of the Teesside Refinery is consistent with increased international focus on diversifying rare earth supply and supporting production outside of China.
Bardin Davis, MD of Peak comments:
“This is a significant milestone for Peak and our strategy to become one of the major integrated producers of NdPr Oxide outside of China. With incredibly strong global demand for non-Chinese rare earths, we are ideally placed to supply these critical commodities, which are driving the electrification and decarbonisation revolution.
“The Teesside location provides a major competitive advantage with its “plug and play” infrastructure, skilled labour force and proximity to potential customers, while its freeport status provides tangible tax and other benefits.
“Our refinery is also poised to make the UK a major supplier of NdPr Oxide, supporting its transition towards a net-zero carbon economy and the development of its cleantech supply chains.
“The project also has strong government backing and on behalf of Peak I would like to thank Homes England, Redcar and Cleveland Borough Council and the UK Department for International Trade for their ongoing support.”