The Export-Import Bank of the U.S. may provide up to $750 million for Aclara Resources’ (TSX: ARA) Project Dynamo rare earths processing plant in Louisiana, marking another Washington-backed effort to build Western rare earth supply chains.

Aclara said Friday that the letter of interest from EXIM shows the bank’s interest in financing Dynamo, a planned separation, metals and alloys facility 340 km west of New Orleans that is due to start in 2028. The project is estimated to cost $277 million to build and would produce at commercial scale the separation demonstrated at Aclara’s pilot plant in Blacksburg, Va. The potential loan amount far exceeds the plant’s estimated construction cost, reflecting financing that could also support the broader integrated supply chain Aclara is developing.

“Clearly, the U.S. is looking at Aclara as an integrated company, not as a set of standalone assets,” Aclara CFO François Motte told The Northern Miner in an interview on Friday. “What they really like about us is that we will be providing not a mixed carbonate, but finished products that customers can procure directly, without having to figure out the rest of the value chain.”

$3.5B this year

EXIM’s interest adds to about $3.5 billion in potential federal support earmarked or finalized this year for rare earth development in the U.S., underscoring government backing for supply chains outside the influence of China, which dominates rare earth mining and processing. Demand from defence, artificial intelligence data centres and other modern technologies is expected to soar. Rare earths such as neodymium and praseodymium are key inputs in the permanent magnets used in electric vehicle motors, wind turbines and military systems, which has made domestic processing capacity a stated U.S. policy priority.

In June, the Office of Strategic Capital (OSC) announced a $725-million conditional loan for Energy Fuels (TSX: EFR; NYSE-A: UUUU) to expand rare earth separation at its White Mesa mill in Utah and build downstream metals and allied production facilities. Also in June, private refiner Phoenix Tailings received a conditional $500 million loan from the OSC for rare earth midstream processing at its Massachusetts and New Hampshire plants.

USA Rare Earth (Nasdaq: USAR) also executed definitive agreements in June with the Department of Commerce to unlock almost $1.6 billion in funding under a CHIPS Act-backed initiative.

“EXIM’s interest in financing our separation, metals and alloys facility in Louisiana represents a key milestone for Aclara and a strong validation of our strategy to build an integrated mine-to-alloy rare earth supply chain,” Aclara CEO Ramón Barúa said in a release.

Aclara shares rose 2% to close at $3.56 apiece on Friday in Toronto, giving the company a market value of $883 million. The stock has traded between $1.56 and $5.40 over the past 12 months.

Financing conditions

A letter of interest is a preliminary indication and does not guarantee financing; EXIM support would require the bank’s full due diligence and approval process.

The EXIM financing would come with several conditions, Motte said, including Aclara showing Dynamo’s engineering, environmental assessments and permits, as well as the prices and equity terms Aclara would have with offtake customers. He expects to provide all of that to the bank in the first or second quarter of 2027, when site preparation for construction could also begin.

Commissioning and first production could start in the second half of 2028, he added.

Heavy separation capabilities

At full capacity, Dynamo could produce 1,131 tonnes a year of the light rare earths neodymium-praseodymium, Aclara said. Its heavy rare earth output could total 148 tonnes of dysprosium and 25 tonnes of terbium annually. Dysprosium and terbium are added to magnets to make them stable at high temperatures, a requirement for many defence and electric-vehicle applications.

Energy Fuels’ White Mesa mill and MP Materials’ (NYSE: MP) Mountain Pass are the only U.S. facilities that separate light rare earths at commercial scale. Neither can yet separate heavy rare earths.

Aclara’s Penco Module mine in Chile and Carina Module site in Brazil would supply feedstock for the company’s U.S. operations.

Penco could be first supplier

Although separation of rare earths produced at Aclara’s South American projects is still some time away, Motte said Penco in Chile could be the first to provide feedstock to Dynamo, located at Port of Vinton, La.

Penco, about 430 km south of Santiago, could produce about 774 tonnes of rare earth oxides (REO) a year over 14 years, according to a 2021 preliminary economic assessment.

At a 5% discount rate and a base-case price of $96 per kg of REO, Penco has an after-tax net present value (NPV) of $178 million and an internal rate of return (IRR) of 23%. Initial capital of $119 million could be repaid post-tax in 4.7 years.

Aclara aims to publish a feasibility study for Penco by the end of this year, with production potentially starting in 2027.

“Chile is a great opportunity,” Motte said. “It’s a simpler project to be built from a capital perspective and from infrastructure availability.”

Carina’s larger output

Carina, in Brazil’s Goias state, has a $1.6-billion post-tax NPV and a 26.9% IRR at initial costs of $781 million, according to a feasibility study released in April. The project could produce about 4,378 tonnes of REO annually over an 18-year life.

Early works are targeted for this year, followed by full construction in 2027 and initial production in the second half of 2028.

The U.S. International Development Finance Corporation (DFC) last year earmarked up to $5 million to support Carina’s development.