USA Rare Earth subsidiary developing new plant in France
USA Rare Earth (USAR) announced plans to develop a 3,750 metric ton per annum (mtpa) metal and alloy production facility in Lacq, France with support from the French government.
The plant will be developed through its subsidiary Less Common Metals (LCM Europe).
USAR said in a press release that the facility will be co-located with the Carester oxide processing facility in Lacq, which is scheduled for commissioning in late 2026.
The two facilities "will establish a comprehensive supply chain for rare earth processing, metal and alloy production in Europe," USAR said.
In order to help facilitate the development of the facility, the French government has approved direct tax credits for LCM Europe under the C3IV program of up to 45% of all eligible equipment and up to a total of €130 million (USD $152.2 million) for real estate.
The C3IV program is a French tax credit designed to boost domestic green tech manufacturing by offering significant financial incentives for approved projects.
USAR said the government has also expressed interest in providing support for hiring and training programs associated with LCM Europe's new facility.
"The development of an integrated rare earth processing and metal-making platform in France enhances USAR's integrated rare earth value chain, to the benefit of the United States and our allies," USAR CEO Barbara Humpton said in a statement.
"We are proud to establish Europe's first metal-making platform, which will accelerate the realization of a secure, sustainable transatlantic rare earth value chain."
USAR shares have rallied 62.4% to start the year.
USAR completed its acquisition of LCM in November for $100 million. LCM is a leading earth metal and alloy manufacturer based in the United Kingdom.
The company cited LCM's "strong network of long-term customers" across defense, automotive and magnet manufacturing in Europe and the United States as being a key highlight of the transaction.
LCM also "maintains established government relationships" in Europe, the US and Japan.
The acquisition paid off immediately as LCM reached a supply agreement with Belgian-French multinational chemical company Solvay SA (BRU) and Arnold Magnetic Technologies Corporation in December.
On the domestic front, USAR said last week that it is making a "significant acceleration" of its timeline to begin mining at its Round Top rare earth deposit in Texas, with commercialization now slated to happen in late 2028.
This is two years earlier than the company had previously targeted.
The company said Round Top is the richest known deposit of heavy rare earth elements, gallium and beryllium, calling it a "cornerstone" of its integrated mine-to-magnet value chain.
"We're challenging ourselves to innovate and pursue creative solutions that accelerate our timeline for securing, reshoring, and growing the US rare earth value chain," Humpton said.
Benchmark analyst Subash Chandra reiterated a Buy rating for USAR in a client note on Wednesday and maintained a $15 price target, calling the development of the new facility in France a "key strategic asset for EU rare earth independence."