Greenland REE project boasts hits of ‘strategic value’

[Ben Graham]

Critical Metals (Nasdaq: CRML) has returned results as thick as 65 metres grading 0.55% total rare earth oxides (TREO) from surface at Tanbreez, one of the largest undeveloped heavy rare earth deposits outside China.

That result in hole DDH-C-24 at the Fjord deposit in southern Greenland is top-tier and important for showing continuity in a bulk target that could support long-life production. The Tanbreez hole included 25.5% heavy rare earth oxides (HREO) and 90 parts per million (ppm) gallium oxide (Ga₂O₃), an important energy transition metal for its use in semiconductors, LED lights and solar panels.

“These incredible results underscore the strategic value of Tanbreez as a rare earth elements and gallium project with scale, grade, and a high proportion of critical heavy rare earths,” Critical Metals CEO and executive chair Tony Sage said in a release on Monday. “With China’s total control over the rare earth market globally, securing sources of these critical minerals has become paramount for US defence capabilities and national security.”

Rare earth tailwinds

The results come just over a month after the United States’ Department of Defense (DoD) struck a key partnership to spur domestic production of rare earths. The deal with MP Materials (NYSE: MP) made the Pentagon the largest shareholder in MP, which operates the Mountain Pass rare earths mine in California, and set a price floor of $110 per kilogram for neodymium-praseodymium (NdPr) materials.

Critical Metals shares fell 6.9% to $5.43 apiece on Monday morning in New York, for a market capitalization of $534.4 million. The stock has traded in a 12-month range of $1.23 to $10.15. 

While the Tanbreez assay is much less than the 17% TREO surface channels samples found at US Critical Materials’ (OTC: USCMF) Sheep Creek project in Montana or Steenkampskraal Holdings’ 14% TREO in South Africa, it’s in line with bulk, low-to-mid grade, very large-scale rare earth projects such as nearby Kvanefjeldheld by Energy Transition Minerals (ASX: ETM) and Norra Kärr in Sweden held by Leading Edge Materials, TSXV: LEM).

High-grade HREO

Another noteworthy Tanbreez result, hole DDH-B-24 cut 61.3 metres grading 0.5% TREO, 26% HREO and 100 ppm Ga₂O₃; while hole DDH-A2-24 intersected 41 metres at 0.52% TREO, 26.9% HREO and 95 ppm Ga₂O₃.

DDH-A1-24 cut 40 metres grading 0.48% TREO, 27.1% HREO and 100 ppm Ga₂O₃, with mineralization remaining open at the bottom of all holes, the company said.

The holes are part of an ongoing resource upgrade program for Fjord, with more than 1,500 metres drilled so far this year and additional assays pending.

The project has an estimated net present value of about $3.04 billion (C$4.1 billion) or about $2.8 billion to $3.6 billion at discount rates of 15% and 12.5%, respectively, before tax; with an internal rate of return of 180%, according to a preliminary economic assessment from March.

Tanbreez, made up of the Fjord and Hill zone deposits, hosts 25.4 million indicated tonnes grading 0.37% TREO and 19.5 million inferred tonnes at 0.39% TREO.