Arafura Rare Earths (ARU) Investor presentation summary

Strategic importance of rare earths

• NdPr oxide is essential for high-value industries such as EVs, wind turbines, robotics, and defense, with a significant value chain multiplier effect, as 1kg of NdPr oxide is valued at US$100 and is a critical input for electric vehicles and other advanced technologies.

• Demand for NdPr oxide is forecast to double by 2035, driven by a 7% CAGR, with robotics expected to see a 22% CAGR, highlighting the need for new supply sources like Nolans.

Nolans Project overview and economics

• Nolans is a fully integrated, single-site mine-to-oxide project with a 38-year mine life, targeting 4,440 tpa NdPr oxide and 573 tpa SEG/HRE oxide, and is construction-ready with all permits secured.

• Projected upfront capital cost is US$1,191m, with a post-tax NPV of US$1.9bn (base) and IRR of 18.1%, and forecast to be in the first quartile of the global cost curve at ~US$32/kg NdPr net of by-product credits.

• The project is designed for scalability, with Phase 2 expansion potential and the ability to process third-party feedstocks.

Funding and equity raising

• A two-tranche institutional placement aims to raise ~A$350m, with an additional A$25m targeted via a share purchase plan, fully funding the equity component for Nolans.

• Hancock Prospecting has committed A$85m, and cornerstone investors include Export Finance Australia, KfW, and the National Reconstruction Fund Corporation, with over US$1bn in debt conditionally approved.

• The placement is fully underwritten except for Hancock’s commitment, and shareholder approval is required for tranche two and cornerstone subscriptions.