A Delaware-connected rare earth mining company is exploring the establishment of a magnet manufacturing facility in France after announcing a significant investment in a French processing operation.
USA Rare Earth revealed Thursday it will invest 40 million euros ($47 million) to acquire a 12.5% ownership stake in Carester, a French company constructing a rare earth processing facility in southern France.
The investment comes as both the United States and European nations work to develop independent sources of rare earth materials, which are essential for renewable energy technology, electronic devices, and military equipment, while reducing reliance on China, the world’s dominant supplier.
“They (the French government) are interested in… supporting a potential USA Rare Earth magnet-making facility in the south of France,” CEO Barbara Humpton stated during an investor conference call.
Chief Financial Officer Robert Steele confirmed the company is in preliminary planning phases for the potential magnet plant but declined to provide specific timelines or additional details about the project.
USA Rare Earth’s strategy involves creating a comprehensive rare earth operation that encompasses mining, processing, and magnet production. The company secured $1.6 billion in combined debt and equity financing from the U.S. government in January and operates a magnet manufacturing facility in Stillwater, Oklahoma, scheduled to begin operations later this year.
InfraVia, a critical minerals investment fund supported by the French government, will also purchase a matching 12.5% stake in Carester as part of the agreement.
Carester’s French facility will focus on producing heavy rare earths, materials that are crucial for magnet manufacturing but may become increasingly difficult to obtain due to anticipated supply shortages, according to industry analysts.
The partnership includes 15-year supply and purchase agreements that will allow USA Rare Earth to ship materials from its Round Top mining operation in Texas to France for processing and then acquire the resulting heavy rare earth oxides.
USA Rare Earth’s British subsidiary, Less Common Metals, which manufactures rare earth alloys and metals, previously established a partnership with Carester in May of last year to develop a processing plant in France.
Carester has secured 216 million euros in funding from Japanese investors and the French government for its Caremag processing facility, which is projected to produce 1,400 metric tons of rare earth oxides annually from recycled magnets and mining materials.
