REEtec raises NOK 1200 million for first industrial plant

8 November 2022

REEtec, the company that was established by Scatec Innovation, has closed a financing round of NOK 1200 million (EUR 115 million) to build the first full scale production plant for separating rare earths. The plant will be built in Herøya, Porsgrunn where REEtec has been operating the demo-plant since 2019.

REEtec has developed a proprietary technology for environmentally friendly and efficient production of neodymium and praseodymium, commonly referred to as ‘NdPr’. Known as “magnet metals”, these two rare earth elements are essential in the manufacturing of electric motors,wind turbines, robots, and pumps.


Through this financing round, LKAB, the international mining and mineralsgroup, will become the largest shareholder in REEtec. The Norwegian State's climate investment company Nysnø and energy and commodity groups Mercuria andTechMet also participated with new equity alongside existing shareholders where the REEtec founders,  Scatec Innovation,is included.


“Governments and businesses in Europe aim to reducethe reliance on imports, and the European Commission considers rare earthelements to be critical materials for reaching climate neutrality by 2050. HavingLKAB, with its strong industrial position and technical insight, as a new major shareholder is a sound endorsement of our technology. REEtec is now wellpositioned to become a leading European REE producer,” says John Andersen,Chair of REEtec and CEO of Scatec Innovation.


“LKAB plans to extract rare earth elements as aby-product from our iron ore mining. Together with REEtec, we can create the basis of a strong and sustainable Nordic value chain for rare earth metals,”says Jan Moström, LKAB’s President and CEO.

Together with REEtec, we can create the basis of a strong and sustainable Nordic value chain for rare earth metals,”says Jan Moström, LKAB’s President and CEO.

REEtec’s first plantfor separating rare earths will provide annual production of 720 tons of NdPr oxidefrom the second half of 2024 which represents approx. 5% of the estimated demand in the EU. REEtec’s proprietary technology can reduce CO2emissions by 90% compared to other leading suppliers, as virtually all consumables are recovered and re-utilized in the process.

The Herøya Industrial area including a rendering of the new REEtec plant building.

The Herøya plant will process rare earth carbonates produced by Vital Metals in Canada. Under an agreement betweenREEtec and Vital Metals, it is the parties’ intention to triple volumes fromVital Metals, thereby providing REEtec with a basis for significant expansion.REEtec has secured offtake for 80% of the NdPr from the first plant, includinga 5-year contract with the global automotive supplier Schaeffler Group.


“Our strategic alliance with Vital Metals is an important pillar of our business plan. In addition, Norway, Sweden, and Finland contain significant rare earthdeposits which makes the Nordics an attractive region to develop a complete value chain of mineral extraction, separation, and processing to production ofmetals and magnets,” says John Andersen.


A second plant is planned to be built in Herøya in 2026, based on material from Vital Metals as well asfrom LKAB’s mining operations which is expected to be available from 2027.

Here is a short introduction to the new investors


About LKAB

LKAB is an international mining and minerals group that offers sustainable iron ore, minerals, and special products. LKAB is committed to developing carbon-free processes and products by 2045, leading the transformation of the iron and steel industry. Since 1890 , unique innovations and technological solutions have been developed and driven forward by more than 4,500 employees in 12 countries. In 2021, the LKAB group had sales of about SEK 49 billion.


About Nysnø Klimainvesteringer 

Established in 2017, Nysnø Climate Investments (Nysnø) is a state-owned climate investment company that invests in companies and funds with profitable and smart solutions to reduce greenhouse gas emissions. With 2.9 billion NOK inassets under management Nysnø invests within clean energy, digital and enabling technologies, resource efficiency, sustainable demand, and the circular economy. Nysnø is based in Stavanger and owned by the Norwegian Ministry of Trade,Industry & Fisheries.


About Mercuria
Established in 2004, the Mercuria group is one of the largest independent energy and commodity groups in the world, bringing efficiency to the commodity value chain with technology, expertise, and solutions. Mercuria’s business includes trading flows, strategic assets, and structuring activities that generate more than $120 billion in turnover. The company has built upon a series of strategic acquisitions, including the physical commodities trading unit of JP Morgan Chase & Company, Noble Group’s US gas and power business and the Aegean Marine Petroleum Network, reorganized as Minerva Bunkering. It has become one of the most active players in the renewable markets with more than fifty percent of new investments dedicated to the energy transition.


About TechMet

TechMet Limited is a leading technology metals investment company with a portfolio of assets that produce, process, and recycle the metals that are critical to the global energy transition and the electric vehicle revolution.Current global assets in the TechMet portfolio include vanadium processing, hard rock and brine lithium development, nickel-cobalt mining, rare earth mining, tin mining, direct lithium extraction. TechMet’s major shareholders include the U.S. International Development Finance Corporation and the global energy and commodity group Mercuria.