Lindian Resources (ASX:LIN) and Iluka Resources (ASX:ILU) have formalised a strategic partnership through a binding loan term sheet and offtake agreement focused on rare earth concentrate supply. Lindian Resources is focused on rare earths and bauxite, and plans to produce a premium monazite concentrate. Iluka Resources, which produces zircon and titanium, is expanding into refined rare earth oxides.
Under the agreement, Iluka, capitalised at $2.48 billion, will provide a US$20 million ($30.86 million) construction term loan facility with a five-year tenor. These funds will primarily finance capital costs for Lindian’s Kangankunde Project. The loan’s availability is contingent upon Iluka’s due diligence, full funding of the Kangankunde project, and the deployment of other construction funding sources. The offtake agreement commits Lindian to supply Iluka with 6,000 tonnes per year of rare earth concentrate over a 15-year period.
The supplied material is intended as supplementary feedstock for Iluka’s Eneabba rare earths refinery, representing approximately 10% of its total capacity. The Eneabba refinery, currently under construction and scheduled for commissioning in 2027, is poised to become Australia’s first fully integrated rare earths refinery, producing both light and heavy rare earth oxides.
According to Iluka Managing Director Tom O’Leary, this deal exemplifies Iluka’s proactive role in catalysing new mine production to supply its Australian refining operations. Lindian Executive Chairman Robert Martin views the partnership as a pivotal milestone for the company, establishing a clear pathway for the Kangankunde project’s advancement. The agreement also includes a right of first refusal for Iluka to secure up to an additional 25,000 tonnes per annum of product, contingent on funding 50% of the capital cost for a stage two production expansion.
