Australian Strategic Materials Limited (ASM) (ASX:ASM) has announced promising results from a Scoping Study evaluating a potential first-phase development of its Dubbo Project. The focus is on rare earth oxide production using a heap leach purification, separation, and refining flowsheet. ASM is an emerging vertically integrated producer of critical materials for new growth industries, advanced technologies and sustainable energy solutions. The study outlines a potential phased implementation strategy, with an initial phase processing 1 million tonnes of material per annum to produce separated light and heavy rare earth oxides, addressing growing global demand.
The Scoping Study represents a significant shift in the Dubbo Project’s development approach, simplifying construction and potentially accelerating cash flow generation by eliminating complex initial processing stages. Key highlights include a forecast capital cost of AUD 740 million (including contingency), a reduction of over AUD 900 million, or approximately 56%, from the AUD 1,678 million estimate in ASM’s 2021 Optimisation Feasibility Study. Operating expenses are projected to be in the lowest quartile of operating costs among ex-China rare earth producers.
Average production targets for years 3-15 estimate a total of 1,242 tonnes per annum of rare earth oxides, including 1,157 tpa of NdPr oxide, 13 tpa of Tb oxide, and 72 tpa of Dy oxide. The project forecasts robust financials across multiple pricing scenarios. Based on a blended pricing forecast, the pre-tax NPV is AUD 967 million with a pre-tax IRR of 18.3%. Under a pricing upside scenario, the pre-tax NPV increases to AUD 1,468 million, and the pre-tax IRR rises to 22.9%.
Rowena Smith, Managing Director and CEO, stated that the Rare Earth Options Assessment directly responds to the need to reduce upfront capital costs and accelerate the delivery of rare earth oxides. The company is targeting completion of a Pre-Feasibility Study (PFS) in Q1 2026. The Heap Leach Option would present the opportunity to implement a simplified processing route for rare earths using low-cost, proven heap leaching technology.
