Summit Minerals Investor Webinar | INN

Aclara Resources Inc. (“Aclara” or “Company”) (TSX:ARA) is pleased to announce that it has signed a Memorandum of Understanding with VACUUMSCHMELZE GmbH & Co. KG (“VAC”), which establishes a non-binding, non-exclusive, preliminary agreement, to jointly approach potential clients as a “mine-to-magnets” solution for ESG compliant permanent magnets (the “Preliminary Agreement”).

Aclara and VAC believe that there is a significant market opportunity driven by the rising demand for electric vehicles (“EVs”), wind turbines, and other clean technologies that require rare earth permanent magnets produced pursuant to ever-increasing ESG standards. Such permanent magnets require significant quantities of both light and heavy rare earth minerals. Currently, obtaining these rare earth mineral materials whilst also having the capacity to process them, combined with the industrial technology needed to fabricate permanent magnets, is very limited and concentrated among a few Asia-based suppliers. This supply/demand dynamics results in a promising background to develop a new, resilient, ESG-focused supply for permanent magnets.

The strategic alliance between VAC and Aclara is unique due to Aclara being one of the very few potential suppliers of Dysprosium and Terbium, two highly coveted heavy rare earth minerals which are key in the production of permanent magnets and are not easily available outside of Asia. Aclara is currently developing two ionic clay projects, one in Chile and another in Brazil, for the production of a high-purity heavy rare earth carbonate. In addition, the Company is developing processing technology through its US-based subsidiary to be able to receive this carbonate and produce with it magnetic alloys. These alloys, in turn, are the key input required by VAC to produce permanent magnets.

VAC is considered the largest producer of rare earths magnets outside of Asia, with more than 40 years of experience in magnet making technology. VAC, whose main permanent magnet facility is located in Hanau, Germany, recently executed a contract with General Motors (GM) to supply GM with permanent magnets by building a new magnets’ plant in the State of South Carolina, United States.

Accordingly, each of Aclara and VAC are strategically positioned to collaborate to build a reliable long-term solution to supply high-performance permanent magnets to power EV motors and other technologies for our global clients.

Agreement Structure and Next Steps

The collaborative relationship between Aclara and VAC is not structured as a legal entity. Instead, each of the parties will engage in collaborative efforts, in a relationship characterized as (i) preferred supplier-purchaser and (ii) cooperation on marketing, customer relations, and related matters. Highlights of a number of the collaborative next steps include but are not limited to:

• VAC’s intention to support the further development of Aclara’s rare earth metals and alloys existing joint venture project with CAP…