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Hexagon, Innovation Metals teaming up for US rare earth processing JV

Hexagon Resources Ltd. secured an option to acquire a 49% interest in Innovation Metals Corp.'s proprietary downstream rare earth elements separation technology, RapidSX.

The company said Oct. 10 that the technology will allow rare earth producers outside of China to serve the U.S., European, Japanese and Korean markets and will mitigate the concentration of rare earth supply and separation capability in China.

Under the agreement, Hexagon's U.S.-based unit, Energy Materials of America LLC, and Innovation Metals will form a joint venture called American Innovation Metals Inc.

Innovation Metals will contribute its RapidSX technology IP, and Hexagon will spend US$2 million to build a commercial demonstration plant and pay US$4 million to Innovation Metals from its share of cash flows from the joint venture.

The demonstration plant is planned to have a production capacity of 60,000 to 80,000 kilograms of rare earth oxides per year from a site in North America.

Plant construction and commissioning are expected to be completed in about six months, with operations expected to start in the third quarter of 2020.

The demonstration plant will be used to conduct staged scoping to feasibility-level studies on the performance and the capital and operating costs of a full-scale rare earth separation plant, the company said.

Hexagon will put the option up for a vote at its annual general meeting scheduled for Nov. 22.