Rainbow Rare Earths Limited (RBW) Earnings Call Transcript & Summary

Good morning, ladies and gentlemen, and welcome to the Rainbow Rare Earths Limited Investor presentation. [Operator Instructions] And I would now like to hand you over to CEO, George Bennett. George?

Good morning, and thanks for having me. Yes. Once again, this is a presentation on our year-end results and progress of Rainbow over the last year. And hopefully, some of the attendees might have already seen the announcements we've made over the last year, but I'll cover a lot of those, and hopefully you'll get a better understanding of where we are doing at the moment. There's the usual disclaimer, and I'll now move on to the presentation. Thank you. So I'm pleased to say that we've -- after the last year, we've been able to achieve the first commercial recovery of rare earths elements on phosphogypsum. Guys have been trying to do this for many, many years. Historically, everyone knew the phosphogypsum contained rare earth elements. But when we secured the Phalaborwa project and started working into January 2021, we realize that we have something special here. And as you can see from the slide up there, that the key thing about this type of phosphogypsum that we are chasing around the world is that it's a source or phosphate from a hard rock carbonatite which is mined and turn into a phosphate slurry to concentration process, and this is fed into a phosphoric acid plant. The phosphoric acid plant is used to produce phosphoric acid for the fertilizer industry globally. And in this type of phosphoric acid production process, it uses sulfuric acid, there's a large additive as well as heat to generate phosphoric acid. And that's a key element in the Rainbow project. As I said, the phosphoric acid produces a waste product called phosphogypsum and the rare earths are concentrated in the phosphogypsum that is deposited onto stack. And Phalaborwa's case onto 2 stacks. And the gypsum waste residue -- the rare earths deport into the phosphogypsum waste residue into economic quantities of rare earths and the phosphogypsum. Rainbow has been able to develop a unique flow sheet with in-house IP to recover the rare earths from those phosphogypsum. I just want to stress here that all the technology we're using is not as proven in other industries. So it's tried and tested and proven. In other words, we're using big belt filters, which are commonly used in the mineral processing industry, we're using leach tanks. We're using filtration. We're using rapid consolidation of the rare earths into a pregnant leach solution. And then we're going to continuous ion exchange. Continuous ion exchange is used throughout the world in various industries, but very well known in the uranium industry where it's used -- when you design and build uranium plants. And I want to stress that the Rainbow team have design and build 2 uranium plants and the production. So we've got all that experience within the team. And then we're using continuous ion chromatography which is, once again, it's a technology that was patented some 30-odd years ago. It's used in sugar industry, lysine industry as well as the biochem industry and phosphate industry and it's used to extract uranium and thorium out of phosphogypsum in Morocco at the moment by OCP. And once again, it's a proven technology. We're just using it in a slightly different arrangement or in a flow sheet, and we're targeting rare earths, which [ very similar ] to uranium and thorium that we all know are part of the -- they're not classical rare earths. The 17 elements make up a rare earth sweet, but uranium and thorium are also associated with rare earths. And the fact that this technology is successfully applied to remove uranium and thorium gave us the confidence that it's the right technology to use going forward to extract those out of this phosphogypsum. So as I stress, it's an innovative flow sheet, but we see improvement processes and we're using the proven processes to recover rare earths which are critical to the green technology and the green transition motion, I should say. And there's enough about that on the various, you can Google it, but we all know that it's key to what everyone is trying to achieve in terms of net zero by 2050. So some of the achievements over the last 12 months, which I think we're very proud about our pilot plant as we've been able to produce 2 salable products to date. So initially, I wanted to derisk Rainbow both for investors. And the key -- first key risking step was that we successfully produced a mixture of carbonate. And if Rainbow stopped at that stage, we would have had a successful product, which we could sell. A lot of rare earths projects start and only produce a mixture of concentrate. Then they crack those rare earths into a chemical form and they stop at producing a mixture of carbonate. Now Rainbow successfully did that and the carbonate has got a payability of around about 70%. We didn't want to stop there. We wanted to go all the way through to separated rare earths oxides. As I mentioned, we're using technology that is proven, but it's just the first time we're applying it to the rare earths suite and processing. And we've successfully derisk Rainbow further, but we've been able to achieve a separated rare earths oxide at circa 96% to 97% purity using this back-end technology, we've described continuous iron exchange and continuous iron chromatography. And that in itself is another derisking step for Rainbow because we've established through to completely different parties that we could sell. This purity level of separated rare earths oxides, but we would suffer an impurity discount, similar to other minerals in the mineral space that if you produce a copper concentrate, depending on how pure your concentrates is, you will then get discounted from the index of copper metal, which is 100% copper and your copper concentrate would be discounted for the amount of impurities in your copper concentrate. So it's most similar to what you see in other minerals around the world. But our target is 99% plus purity, and we are on our way to achieving that. We've also, during the last year, secured strategic equity funding for the project at the project-co level from the U.S. government, the DFC of $50 million. This is via the green critical minerals fund of TechMet and this $50 million has been committed by the DFC via TechMet into Rainbows, Phalaborwa project in South Africa. So we think that's a very, very significant derisking step. We had independent third-party validation of our project, of our technology of the flow sheet and so forth. So that was very, very good to receive that $50 million equity investment commitment by the DFC. We also did a $5.5 million private placing, strongly supported by the Board and management during the course of the year. And then in July '24 we did a $10 million raise by an 8.5% royalty agreement and share placement with Ecora. Largely nondilutive to Rainbow shareholders, and we've all been about trying to protect shareholder dilution in Rainbow as we move forward. Once again, Ecora did extensive [ DD ] on Rainbow not only legal, but technical [ DD ] on our flow sheet. And once again, we had a third-party validation signed off twice within the last year on Rainbows processes that we'll be using to extract the rare earths from the phosphogypsum. So once again, I believe a very big and confident tick in Rainbow. We also had an update of the resource an increase by 15% to circa 35 million tonnes, which will give us extra 2 years of project life. We've gone from 14 years to 16 years and 16 years for the guys in the industry will know, that's a very, very good sort of project life for this type of project. And we -- and as we've mentioned, the in-situ value of the rare earths at spot prices at the time is $7.3 billion. And we all know that rare earths prices are forecast to continue rising steadily, hopefully, but strongly over the next decade. In terms of trying to create independent supply chain outside of the U.S., we've entered into an MoU with LCM. LCM are a business that's been in around for over 30 years, and they take separate rare earths oxides, turn into metal and then alloy, which they then sell to permanent magnet manufacturers. LCM are doing expansions at the moment in the U.S., and they're looking for a source of separated oxides, and they believe Rainbow will be one of the projects that will go to construction and into production hence why they signed the MoU with Rainbow. They targeted Rainbow some 3 years ago. So this is the sort of accumulation of a couple of years of discussion and when they saw our success in the pilot plant, they are happy then to sign an MoU with Rainbow. And we've also deepened into offtake discussions with various supply chain participants, OEMs on the car manufacturing side on the wind turbine side. And on the wind turbine side, they seriously are worried about dysprosium and terbium supply, and we will be a commercial producer of both of those 2 key rare earths products. Terms of circularity, as I said, we've also entered into an offtake agreement or letter of intent to -- with the biggest gypsum trade in South Africa to sell phosphogypsum that we process and take the rare earths out of. Unfortunately, we can't sell all the phosphogypsum we process every year. We're processing 2.2 million tonnes. We'll be able to sell somewhere between 400,000 and 600,000 tonnes per annum into the phosphogypsum industry because the whole industry is only 1.2 million tonnes per annum. But obviously, over the course of the project and for another 40-plus years, we will continue to sell gypsum into the South African market and eventually with the complete rehabilitation and cleanup of the sites at Phalaborwa. So it's a very, very strong ESG story and the fact that we are protecting the environment by what we're doing, we think makes Rainbow also a compelling story. And then just in terms of diversification, we also signed an MoU with Mosaic. One of the largest fertilizer producers in the world, they are circa $14 billion, $15 billion business and that large phosphate deposit in Brazil. There have been a large phosphoric acid mine -- acid production process plant in Brazil as well at Uberaba producing fresh phosphogypsum and we've entered into an MoU to use our IP to develop and extract the rare earths out of their phosphogypsum on a 50-50 basis, and we've already released announcements regarding Uberaba and now they're on our website for those of you who want to go and have a look at more detail about the Uberaba project, which we are very, very excited about at Rainbow. Once again, it's a very similar hard rock carbonatite producing phosphate slurry feeding of phosphoric acid mine where they add phosphoric acid plant, I should say, with the adds of sulfuric acid and heat and they create a waste residue of phosphogypsum with rare earths in it. And then we've had strategic partnership approaches from -- because of our advancements in the space because of our positive applications of our process flow sheet, Rainbow's [ IP ] in terms of producing mixed earth carbonate and now producing separated rare earths oxides, to the purity level of 96% to 97%. We've had approaches from guys in Canada and India and Saudi Arabia, all in the phosphogypsum space, all looking to partner with Rainbow going forward. So this is opening up a huge addressable market to Rainbow. The fact that we are getting this technology right. I did announce a delay in our RNS some 4 weeks ago but that delay is purely on the fact that I've always said, from a technical point of view, we won't take any shortcuts. If it takes 6 months or 9 months longer to get to the right result is far more important than going into production with a flow sheet that's not 100% right, you'll pay -- you regretted down the line. And having a team that's built many, many mines and process plants around the world, we recognize that this is not something that we want to do at Rainbow will take a bit longer to get the driver and the fact that we are getting it right and we will get to the final purity level that we target 99% to 99.5% purity and separated oxides. This is why we are getting these approaches, and it's -- so it's far more important to spend a bit longer getting the tech right because it will turn Rainbow into a very diversified project company or a company with lots of projects around the world and we believe a multibillion dollar business eventually. Just in terms of the market, we all know that these rare earths are essential for, as I said, the green transition. They currently use consumer electronics until recently about 50% of all permanent magnets that had rare earths then we're in the consumer electronic business, in other words, smartphones, speakers, drones, handheld, drills, electric scooters, electric motor bikes. And then the last few years has been a massive take-up of permanent magnets and electric vehicles as well as plug-in hybrids, which also require electric motors using permanent magnets and also a very strong driver is wind turbines. And then there's also the defense application and the geopolitics we know around the world are not great at the moment and defense is even more key now because every American F-35 fighter jet, for instance, takes 420 kilograms of rare earths elements in it. Abrams tank has got, I think, 2 to 3 tonnes of rare earths per tank. And submarine, the -- I can't think of the class name now, but one [ escapes me ] but these bigger submarines got sort of 15 tonnes rare earths elements in them, just to give some examples of the strategic applications in defense. We believe that the trend is unstoppable. It's a global megatrend in terms of EVs. The take-up might be a bit slower. We know that the take-up has been a bit slow, but it's not going away. We know that in a lot of countries around the world between 2035 and 2040, you won't be able to buy an internal combustion engine motor, what they call an ICE motor vehicle. It will be plug-in hybrids, and it will be full in EVs. Plug-in hybrids also take a lot of permanent magnets in their motors. So it's very similar to a full EV. And as you know, even though the take-up in full EVs have been slow, the take-up in the hybrids has been very, very strong. So the offset, the slow take-up in EVs has been more than -- the take up has been more than offset by the plug-in hybrid takeup. And then rollout of wind turbines. We know that's not going away. These wind turbines, a 3-megawatt direct-drive wind turbines takes 2 tonnes of permanent magnets in it. And of those 2 tonnes, 600 or 700 kilograms of rare earths elements. So we all know that wind capacity that's been rolled out offshore is not going away. It's growing very, very strongly. As you can see in 2023, it grew by 112% and there's extra 500 gigawatts of offshore wind turbine capacity forecast to be installed by 2034. So a massive massive rollout of wind turbine capacity is still on the card, and this is a mega trend, as I mentioned, that's not going away in both electric vehicles as well as wind turbines. I was in Toronto just 3 weeks ago at a very large rare earths conference, the Adamas Rare Earths Conference in Toronto, all the major players in the industry were there. And the whole conference was very excited by 2 new frontiers of permanent magnet demand over the next decade, and these are humanoid robots. And just a week or so or take 2 weeks after the Toronto conference, Elon Musk announced the launch of this humanoid robots. At the moment the humanoid robots have some 36 rare earths magnets in them and they're forecast to go up to 78 permanent magnets, basically doubling. And the reason why they're doubling is to give humanoid robots full for -- movements similar to what we as a human have. So this will make these robots able to pick grapes, tie shoelaces, serve drinks on a bar, pour cocktails and so forth. So we all know that you've got negative growth rates in China, negative growth rates in Japan, negative growth rates in Europe and so forth in certain countries in Europe, like Germany, Italy and these robots will be able to fulfill a large labor demand that will be -- at these countries, will be looking to source some from outside, from somewhere, and we believe robots are going to be able to make up for a lot of this labor that at the moment, certain Western countries or looking and China included. These humanoid robots are, as I said, are forecast by 2040, they say there will be $1 billion of these built and some forecast is even more aggressive than that but the amount of rare earths magnets per robot range from 5 to 15 kilograms. So that's similar to an EV to 3x what's required in an EV depending on how sophisticated these robots are and this is something that's very real. And about 2 months ago, my son was in Los Angeles and he post -- he sent me a video of a robot doing a pizza delivery in L.A. And he's already received deliveries from Amazon via drone at the moment. So the take-up in drone is going to increase in the commercial area, and we've already seen it starting to replace Uber scooter drivers and the Deliveroo scooter drivers. And this is very real. And this is a trend which is not going to go away and it's going to grow dramatically over the next decade. If we could just show a quick video of this delivery taking place in L.A. right now. [Presentation]

Thank you. That was my son stopping the robot there on its way to deliver a pizza or hamburger. But yes, this is very real, and it's very exciting for the rare earth space that we see massive demand over the next decade taking place in this field. And then the next frontier is what they call eVTOLs or e-mobility. This is electric vertical takeoff and landing vehicles. Basically, as I mentioned, drone deliveries are going to get bigger and bigger. The payloads are now up to 40 kilograms. The next payload is going up to 100 kilograms, and then they're talking up to 400 kilograms. eVTOLs are basically air taxis, very real. 30 years ago, we thought this was pure Star Wars and was pure science fiction, while it's here today. At the moment, in the U.S. alone, there are 4 licenses, commercial licenses that have been applied for at the FCAA, that's the Federal Civil Aviation Authority to start air taxi trial runs commercially from 2 from New York or JFK, 1 in Chicago and 1 in L.A. And basically, these guys will be able to take you from a place like L.A. to San Diego, which is over an hour's drive in traffic, you'll be able to do that trip in 8 minutes and the price is the same as Uber Black per kilometer. So for the same prices in Uber Black, you'll do a trip in 8 minutes, which will take you an hour, 1.5 hours in traffic in L.A. and the forecast of this type of demand is going to pick up. As I said, next year, it's a commercial reality. And in the next decade between 2030 and 2040, we see a massive massive takeup of this type of mobility. And it's a very exciting new frontier for rare earths and permanent magnets. And it's going to ensure that the mega trend stays in place at even a higher rate. In fact, by 2040, the demand for robots and eVTOLs for permanent magnets will be outstripping electric vehicles, plug-in hybrid vehicles as well as wind turbine demand. We all know that China controls the supply chain for mining through to separation, refining and magnet manufacturing. And this is why there's such a strong diverse focus or strong focus on diversifying supply outside of China. We'll always have supply from China, but it doesn't make sense to rely on one country to dominate so strongly. The moment China dominates about 60% of primary rare earths concentrate production. But over 90% of the downstream beneficiation supply chain is controlled in China and there's a massive focus as we all know, to diversify outside of China. And we believe Rainbow is going to be part of this diversification supply chain, and we will be one of the successful projects which is coming into the action in the very, very near term. There are lots of development projects out there. Lots of new projects that apparently been found in Brazil, for instance, these are ionic clay deposits. But like the market knows mining projects take typically between 15 and 25 years from discovery to go into production. So there are -- there is -- even though there are new discoveries, these are a long way away. So the near-term projects that are going into production and Rainbow is certainly one of those. And the project like Uberaba will also have a very similar short time frame to go into [ production ] like we are seeing what we're achieving with Phalaborwa and Rainbow. It's well known about the geopolitics and with tariffs now being imposed on Chinese electric vehicles and then the Chinese responding with export bans on certain key materials and certainly technology. So this is not going away at the moment. And whether it's a Biden administration in power -- or the Kamala Harris administration gets into power, or it's a Trump administration, they bipartisan on the Chinese threat to these critical minerals, and that is not going to change whoever is in the power in the U.S. in the next month. Just a snapshot of our project once again, on the right-hand side, you can see, that was a pilot of reclaiming the phosphogypsum in a Phalaborwa that we ran in February this year very successfully, and that was part of our DFS process to prove that we could retain the phosphogypsum as we envisaged it through high-pressure hoses and that was just a photograph of the trial mining that took place. And lots of investors and analysts were on that site visit in February this year. As I said, our CapEx and our PEA, which we released in October 22 was circa $300 million with the process flow sheet development, we've been able to achieve by running a large-scale pilot plant in Mintek over the last year we believe our capital expenditure will certainly be within that range. The project NPV was based on rare earth pricing at the time -- spot rare earths pricing at the time of the PEA and as I said, we've got one of the highest proportions of neodymium and praseodymium in our basket of any rare earths projects in the world of just over 29%. And as I said, at spot rare earths pricing, we believe we would have achieved circa $190 million of EBITDA with operating margin of over 75%. So very, very strong metrics, financial metrics, and we believe by the time we come into production, which is forecast now for 2027, rare earths pricing will be very similar to where we were in the PEA. Once again, this is to visualize the project at Phalaborwa, what you [ can't ] see here is that just on the top of this photograph, you've got the Phalaborwa Mining company on our border literally across the fence. You've got the PhosCo phosphate mining company also operating and they're also producing [ iron ore ] out of the same carbonatite deposit that's been mined for 60 years and got a life of another 40-odd years. In the top right-hand side, you can see the multiple phosphoric acid plant that was done by Sasol that created over a period of 60 years, the phosphogypsum stacks that you see. But there's a lot of infrastructure in place, high voltage switch yards in place, the high-voltage power line runs through the property. The property has got security fencing already. There's served by black top hot top road and very importantly, the phosphoric -- sorry, the Phalaborwa copper mine which has got a new sulfuric acid plant operating on our border has got some 10,000 tonnes of excess sulfur acid to get rid of every month, we'll be requiring circa 45,000 tonnes a month sulfuric acid, and we will be supplied directly through the fence and at a very, very low cost compared to any other rare earths project in the world. At the time of our PEA, the phosphoric acid plant -- phosphoric acid price, delivered to the Congo for copper mines in the Congo was $450 a tonne, and our PEA was $95 a tonne. Let's just give you an idea of how important it is to have the source of sulfuric acid on our doorstep. What's important here is that we don't do typical mining cost for a mining project. We don't have any crushing. Well, we don't have any drilling blast then we don't have all to a stockpile that we don't have crushing, milling flotation to produce a rare earths concentrate. Then the rare earths concentrate in the typical mining project, you have to crack into a chemical form before we can start the separation and to crack it, you add sulfuric acid and heat into the mineral concentrate to crack it into a chemical form at Phalaborwa, as I mentioned earlier, they add sulfuric acid, they add heat in the phosphoric acid production process and that means that these 2 phosphogypsum stacks are chemically cracked. And this was a benefit -- a huge benefit to the project. So 2/3 of the flow sheet already taken place for us by the time we start incurring costs to separate the rare earths out of this phosphogypsum. As I've mentioned, we've got a very low CapEx and very low OpEx. And as you can see, the sensitivity to rare earths pricing in the low pricing environment, we have been for the last 6 months or 9 months, rare earths prices a short while ago were circa $47, $48 a kg for NdPr. We're now sitting circa $60 a kg for NdPr. But has been more publicized that there's low rare earths prices and very few -- in fact, no Western rare earths projects can make money at these prices and that is by the Chairman of Iluka. And even the Chinese have indicated that these low prices, they were betting to break even. If you look at this chart on the left-hand side, at $78.46 that's the Rainbow basket at current rare earths pricing, which is circa $60 a kilogram for NdPr, but the reason why our basket is higher at $78.46 is because we've got dysprosium and terbium in our basket, which are very, very highly priced rare earths. And that means the average basket price currently is $78 and $78 a kg. If you look on the right-hand axis, we would still be making circa $80 million per annum of EBITDA. We don't believe there's any rare earths project in the world right now that would be making $80 million of EBITDA per annum at current rare earths pricing. So just this slide just demonstrates how resilient we are to rare earth pricing at the moment in terms of the low pricing environment. And of course, as rare earth prices continue to rise, that's only going to be very positive for Rainbow going forward. We've mentioned that this is a very good ESG story. And so we believe we are a responsible producer of rare earths. It's a brownfield site, it's a closed loop. We're going to be rehabilitating those sites depositing gross tax, redepositing them on to a lined stacks with the IFC principles at the moment, those stacks are online because 60 years ago, there was no legislation forcing people to learn stacks of this nature we will be lining new stacks and selling this benign gypsum into the South African market, and we'll be using some of the infrastructure again. So it's very much a circular closed loop story, and we believe bodes very well for us being a very, very green producer of permanent magnet materials that go into permanent maintenance. Just as I said, we're in a unique position in the rare earths supply chain. We don't have a lot of the upstream processes that make -- are very expensive for rare earths projects. We've got no mining, as I mentioned earlier, no concentration, no cracking, we start off with a crack chemical gypsum stockpiles, and we go straight into separation. Separation using traditional solvent extraction, which we, as a team, understand very well, you've got 2,000, 3,000, 4,000 stages of what they call [indiscernible] and solvent extraction, which is why it's so detrimental to the environment in China. And we have continuous ion exchange, we will have 2 steps of continuous ion exchange and 3 steps of continuous ion chromatography. So far, far smaller footprint and which will be apparent to the market in the next couple of months, when our producer fly-through of the footprint of this project compared to the footprint of other rare earths projects. I believe puts Rainbow in a very unique position. As I said, our primary flowsheet that we've been able to prove is through massive and extensive piloting that we've undertaken over the last year, we ran a large-scale pilot plant at Mintek. When I say large scale, our feed rate for this pilot plant was 20 kilograms per hour. A typical mineral processing pilot plant runs in between 2 -- sort of 3 to 5 kilograms per hour or feed rate. So we as a circa 10x to 20x larger than a normal pilot plant, and we ran extensive lease testing. And as I said, we produced some 35 kilograms of mixed rare earth carbonate, which proves that Rainbow is now derisked, if we stopped at the carbonate stage. But once again, as I said, we were able to also simplify our flowsheet from the PEA. I've made a large announcement on this was on our website and the RNS some 4 weeks ago, where we went into detail about the optimization, the steps we've been able to take out of the PEAs flowsheet which all bode well for CapEx and OpEx for the DFS and which also results in a smaller footprint, which is also very beneficial for the project. As I said, as you can see here, this was the PEA flowsheet that we initially priced and developed in October 22. And all those colored blocks and light purple are the errors that we've been able to optimize and remove, which bodes well for the DFS going forward. And as I said, there's more detail on this on our website. We are very pride at Rainbow that we always go into detail in our announcement in all of the technical nature, we make sure that the market has got confidence that the technical team know what they do. And we've only just kept back enough detail that protects our IP and what we've been able to develop at Rainbow. We also then successfully shipped carbonate to our back-end pilot plant in America, as you can see a photograph over there, how it's sophisticated control delivery a large amount of software. And at this stage, we saw very good separation of what they call the SEG group, which has got a potential for a revenue stream that wasn't in the PEA that we're looking to for the DFS and basically, we have achieved successful separation of NdPr up to 96%, 97% purity level, which we've -- as I've mentioned, we've deemed as a sellable product. And our next steps are now that we announced in an announcement some 4 weeks ago that we are taking this pilot plant from Florida to South Africa to reassemble it and run it because we recognize that we need re-circulating schemes on the back-end from the front-end into the back-end and vice versa going backwards and forwards again, to maintain our overall recovery rate of 66%, 66% recovery of rare earths from your initial feedstock is a very, very high recovery rate in the rare earths market, and we want to protect that. And also, we also realize that the waste stream -- the final waste streams that come out of that can pilot plant have to be deposited somewhere. And at the moment, we can co-deposit these with the gypsum that goes back onto the gypsum stack, these waste teams came into the front-end as part of the phosphogypsum and they will then be fed back into the phosphogypsum and co-deposit back onto the stack. So we don't have any environmental issues, whereas if we had at one stage, we thought we could maybe build a separation plant in the U.S. as a stand-alone project, we would have the problem that we would impact our overall recovery, which wouldn't make sense. And lastly, we would then have to apply for permitting for these waste streams and even though there's only trace elements of uranium and thorium, which came into the -- with the feed we'll go back with the waste stream, as I mentioned, in America, that would require extensive permitting and how long is the piece of string. We all know in America that if you have a permitted site, that cancel a huge [indiscernible] I never understood that until I was involved in the U.S. and realize that these permits can take anywhere from 3 to 10 years to get permitted the site [indiscernible] continuous environmental permitting regulations in U.S. would mean that I wouldn't be able to put my hand in my heart and tell you when we will be in production in the U.S. so the final stage separation because I wouldn't know how long their permitting would take place. So by bringing it back to South Africa, it made sense on a number of fronts, and that's what exactly what we've done. Just to give you a time line, as I mentioned, in 2024, we've given the resource update. We're moving the pilot plant back to South Africa, we've already [indiscernible] which the Mintek pilot plant was sort of those final runs we finished in May, June this year. And during the course of this year, we run the pilot plant at -- in the U.S. and Florida, and we've achieved the separation results I've spoken about. So I think we've had a very successful pilot plant operations in both the front-end and the back-end during the course of this year. We are -- as I mentioned, we will be dropping out an interim report before the end of this year, circa early December, which we'll then be able to footprint the economics and the CapEx of the project very close to the DFS level of accuracy. And I believe it will -- we'll be able to confirm that our PEA numbers were very, very good numbers, very conservative numbers. And as I said, we will then be able to -- on the back of this, we'll produce a fly through video or what the pilot plant or not the pilot what the commercial scale -- the commercial scale plant will look like, sorry for getting my plants twisted there, but the commercial scale pilot plant and this -- the market will be able to see exactly the footprint of this plant and how small it is compared to a traditional plant, which, once again, as I said, is very good for the economics and the CapEx of the project. Environmental work is well underway. It's -- we're about 80% done on the ESIA permitting and the environmental for the DFS. We are -- gypsum stack design has been done by Ardaman in the U.S., the global world experts and gypsum stack design, they've designed and built over 100 gypsum stacks globally Ardaman will be [indiscernible] they'll be finished at DFS level before the end of the year. And we've got the front-end reclaimed portion of the DFS will be complete at DFS Standard by -- before the end of the year. So we're well underway with large parts of our DFS will be complete by the end of the year. It's just the final stage that's led to a slight delay and the DFS which will be completed during 2025. And we will be and also -- the interim report will be kicking off our project financing, and we are still forecasting production for 2027. So that's the corporate team. And can look at this at [ Johannesburg ] we do have this footprint, which is highlighting global opportunities that we have at the moment. We've got Uberaba in Brazil, which is going along very nicely. And as I said, you can look at the announcements, the RNS announcements surrounding Uberaba, we've had approaches from India, Saudi Arabia, and Canada. We have a long-term opportunity with OCP Morocco and we've got our flagship project moving very strongly ahead in Phalaborwa in South Africa. As I said, why Rainbow, well, we've been able to achieve the first commercial production of rare earths elements from phosphogypsum to one of the highest margin rare earths projects in development today. We've got a unique flowsheet that's, cheaper, safer and more environmentally friendly than traditional solvent extraction. We've got strong support from an independent verification of our process through the DFC through TechMet and then investments by TechMet and through Ecora as well. So we think we are on the cusp of unlocking a huge global opportunity for those costs and responsible supply of rare earths for phosphogypsum. Thank you very much. And at your leisure, you can -- this is on our website, and you can go into the appendices at your leisure with this even more information for your analysis. Thank you very much for your time.

Perfect. George, that's great. And thank you very much indeed for your presentation this morning. [Operator Instructions] I'd just like to remind you that a recording of this presentation, along with a copy of the slides and the published Q&A can all be accessed your investor dashboard. And George, as you can see there, we have received a number of questions that were both pretty submitted ahead of today's event as well as those that have made their way through during your presentation this morning as well. So firstly, thank you to all of those on the call for taking the time to submit their questions. And George, at this point, sir, if I may just hand back to you just to read out those questions and give your responses where it's appropriate to do so. And if I pick up from you at the end, that would be great.

Thanks very much. The first question is, is the rare earth elements product from the pilot plant able to be sold? Well, I'm not sure if this question is are we going to sell what we're producing in the pilot plant. The answer is no. Because this is used for marketing and force tending to various offtake OEMs that we've been in discussions with. But if we stopped at where we are, as I said, the 96% or 97% purity, yes, we've established that this could be sold. But as I said, we are optimizing, we're very confident that in our optimization process taking place in South Africa once a pilot plant gets here shortly that we will get our targeted purity level. Next question is Gakara Burundi update, please? We have had a couple of discussions with the government this year. There's a Worldbank report published about 4 weeks ago on the mining industry in Burundi, which supported Rainbow has been the only or the best most responsible miner in Burundi. And as you know, they suspended all mining activity in Burundi not just Rainbow. And we've recently been told by the government that we were in negotiations with them. We gave them a proposal and now we've heard from the government that they want to invite Rainbow back for negotiation, we presume to discuss our proposal. So hopefully, it will be positive near short term or in the [indiscernible] I want to stress that Burundi is a very, very small part of Rainbow going forward. Our key project is Phalaborwa followed by Uberaba and then the other opportunities I've highlighted. The next question is, how long will the current cash position last -- does the DFS with the recent announced date delay completely covered now? Yes, the DFS has completely covered even with the delay we're well funded into the fourth quarter 2025. The next question is, could you expand on why 99% purity for NdPr was not possible to achieve. It is matter of trial and error. Is it a matter of trial and error adjusting the parameters or equipment related to something else? The 96% purity, although sellable would be disappointment from many investors. I fully agree with taking the time to probably optimize the flowsheet in a way -- is the way to go forward. And it's better or no longer and how confident are you that your team can achieve the 99% purity production? It's a good question. And yes, as I mentioned, we've achieved 96% or 97%. That's through 2 parcels of the CIC unit in Florida. What we realized is that we've always said we will need a third pass, but more importantly that we need to remove even more [indiscernible] rare earth elements or basically impurities from the phosphogypsum feed before we go into the final stage separation. We've introduced the continuous ion exchange step at the front-end pilot plant in South Africa. So -- and also with the recirculating modes, in other words, so as you're scavenge your purity off your premium need solution on the resin in these columns and the continuous ion exchange columns, you always leave a bit of rare earths behind. And by recirculating those loads, from the front -- from the back-end into the front-end, you recapture those rare earths that are in solutions. So you never actually lose it. So you actually get 100% of extraction from the back-end by never losing those rare earths that you keep recirculating and that's why we will achieve overall 66% recovery, which is very, very critical. As I said, the team at Rainbow over the last 4 years have purely worked on this phosphogypsum. They understand not only the front-end process, unbelievably well, they also have a huge amount of knowledge now in the back-end separation. They've been working with K-tech and the IP that is in Florida and our team are very confident that by tweaking the elements and just the type of reason that we'll get the final purity level. And we might have to go to a fourth step of CIC to get that final purity. Basically, each step, you get high and higher purity. We always thought we'd get it in 3 steps. But if we had to go to a fourth step, there wouldn't be a train smash to get to the purity level because the final stage separation, the size of that plant would be basically the size of the pilot plant that you've seen in the photograph or you can go back and look at under your in time. So what I'm saying is that the flows reduce so much between each step in these processes there. By the time if we had to introduce a fourth step, the pilot plant size that we see there would be sufficient to get that final stage purity. So we're very confident, as I mentioned. Economically, would you consider adding another purifying step into the current stage? Yes, I've just answered that question. Thank you. The Chinese have lots of expertise. The question is the Chinese have lots of expertise and dominate the sector would you consider JV with them? The answer is no. As I said, we see ourselves as a part of independent supply chain and one of the conditions of $50 million in equity financing at the [ Portico ] level from the DFC is that we are in niche support Western supply chains. So that would mean South Korea, Japan, Western Europe, Canada, America and so forth. Do you think Rainbow will be able to economically extract rare earths from sedimentary phosphogypsum stacks within the next 10 years? That is a good question. And this basically talks to the OCP MOU we have. the Phospho, the rare earths and the net phosphogypsum is very, very, very low compared to carbonatite sources of phosphogypsum. So to answer the question is that we basically got a free option here. If it takes us -- if we over the next 10 years, could develop a way to upgrade the rare earths and net phosphogypsum and then develop economic flowsheet we would obviously do it within Rainbow, and that's why it's basically a long-term option. But as I said, our focus right now is on carbonatite sources of phosphogypsum, which is some of the approaches that we've had. Is the radioactive content of Uberaba phosphogypsum tailings comparable to Phalaborwa? Yes it is comparable. I think if I can remember, it's more internally lower. So yes, very, very low and very positive for the project. As a patent application being submitted to the front-end flowsheet? To be honest with you, no, we haven't submitted it because we realized that we're going to be optimizing the front-end flowsheet and making changes, as you've seen in my presentation. So once we have developed a flowsheet, then we'll take a decision where we want to patent to or not. To be honest with you, we're not sure patents is the right way to go because when you patent something, you have to lay out everything in detail in your patent to -- that's the only way you can get a patent. And basically, that means we'll be opening ourselves up for somebody else to see exactly what are our IP is. And at the moment, our strength is that we developed the IP, it's in-house, no one quite knows how we're doing it, and we are way ahead of everybody else in the game. So we are the front runners. So I think it's a case you basically going to be like an Uber or UberEats. They were the first on the block, and they were so far ahead of the market before other people copy them, they are still the leaders. And we believe Rainbow is in a similar position. So it's not 100% certain whether it makes sense to do a patent or not, but we'll evaluate it once we've nailed down. So once we realize there aren't any more optimization steps in our front-end flowsheet. At good stage all the Phalaborwa project is the [indiscernible] TechMet $50 million could be made available to Rainbow. The terms of that $50 million are on the publication of our definitive feasibility study and when we have a financing term sheet and then that $50 million flows as equity into the project. Can you give an estimate of the discount in percentage terms should the product not reach 99% purity and we stuck at 97%? To be honest with you, as I mentioned, the mix of carbonate, which we know we can sell all day long, there's around about 70% payability. And we think to [ 99% -- 95.5% ] purity is 100% payability, it's going to be somewhere in that range. I don't know 100% for sure. But I would imagine that somewhere between a 10% maximum 15% discount. But it purely my opinion, we have not physically tried to go and get pricing in the market because we don't believe we need to. We believe we'll be at 99% plus purity. Is it feasible to use the extraction rate by introducing a second extraction circuit? Of course, it's feasible. But to be honest with you, we think that what we intend to produce at Phalaborwa is more than enough as a first pass. We could always look if we introduce another plant, it will reduce the time line of the project quite significantly, and that doesn't make sense. But certainly, at Uberaba, where we are looking at extracting the [ debris ] from the raw phosphogypsum feed, there we believe we'll have 2 modules producing rare earths out of their phosphogypsum. I'm just looking for any other -- any other questions, Joe that I might need to answer. Just a question in my presentation, when it will be updated on the website? Yes, it has been updated. It's there. So how are you protecting your IP for your processing. That's once again talks to the patent application. I've mentioned the patent application. We're not sure it makes 100% sense because you then outline all your IP in the patent application, and we will take a decision on that at the right time. Might Rainbow have any interest in partnering other miners to process uranium, carbonate and thorium? As I said, we have approaches from other projects at the moment, but that's to take the rare earths out of the phosphogypsum that they are producing through a similar process that we saw at Phalaborwa and Uberaba. And if this was phosphogypsum produced from a hardrock carbonatite or [indiscernible] technically, I suppose we could look at partnering people. So the answer is not no. But at the moment, we've got our hands full with the opportunities we have already at the moment, to be honest with you. Rainbow has secured attractive funding solution through a royalty agreement further derisking the project, will Rainbow plan for DFC funding? As I've mentioned, we already have DFC funding committed through an equity deal we've done with the DFC of $50 million. But we'll be certainly talking to the DFC on has been a partner in the project financing package that we'll be looking at for Rainbow. We anticipate if we still stick at the $10 million CapEx number that we'll have $200 million of debt, $100 million of equity, $50 million of that equity is already spoken for by the DFC, as I mentioned. So -- and the DFC have indicated they would like to talk to us on the debt package as well. So we will definitely be talking to them on part of that $200 million debt package. Just to conclude, I'm trying to think, if there any other questions here. Which quarter are you anticipating breaking even? Obviously, this is a question for when we get into production. As I've indicated, our time lines have been -- I mentioned earlier that we were looking to go to production early 2020's or we'll be commissioning beginning of '27. This has moved out slightly by the delay in the DFS as I've earned and alluded to, while I mentioned in our announcement 4 weeks ago, but we're still forecasting being in production in 2027. In the last -- sorry, in the second half of '27. And this type of plant to ramp up to full production and full sort of revenue is very short compared to a mining project. We don't have large-scale stockpiles and faces to mine, to build up stopes for your mine plan, which takes a long time when you're commissioning a new mining project and then your plant itself takes a long time for the gold to come out of what they call lockup in the [ mill ] and so forth and in your carbon and niche circuit and your carbon inventory of gold -- so it takes quite a bit longer for this to come out. And this is a mineral processing. As I said, the throughput will be achieved very, very quickly and in terms will get up to mandate throughput very quickly and production of the -- sorry, of the NdPr and eventually Dy and Tb, we believe will also be filling quickly. So I can't give you an exact answer, but it's a far shorter time line than the typical mining project. Thank you. I hope I've answered all the questions adequately. And I think my time is almost up. And I would like to thank everybody for spending the time this morning to get an update on Rainbow to see the progress we've made and to listen to the answers to the questions I've been asked. Thanks very much to everybody.

George, that's great. Thank you very much indeed for being so generous for your time then addressing all of those questions that came in from investors this morning. And of course, if there are any further questions that do come through, we'll make these available to you immediately after the presentation has ended, and just for you to review to any additional responses, of course, where it's appropriate to do so, and we'll publish all those responses out on the platform. But George, all that leaves, I guess, is for me to thank you once again for that's...

Sorry just one question I think I need to answer yet. Before you sign off is. Will we achieve any value for the IP when, as you say, it has rolled out globally. The answer to that question, I think I've answered, which is that we've had these independent approaches from projects in India, Canada and so forth, Saudi Arabia to partner with Rainbow because they'd see the value of our IP. So yes, as these partnerships develop like the Uberaba partnership, we will soon see the value that this brings to Rainbow over the next course of the next sort of 6 to 12 months. Thanks very much.

Perfect George. Thank you. And thank you once again for updating investors this morning. Could I please ask investors not to close this session, you will now be automatically redirected for the opportunity to provide your feedback in order management team can really better understand your views and expectations. This will only take a few moments to complete, but I'm sure will be greatly valued by the company. On behalf of the management team of Rainbow Rare Earths Limited, we would like to thank you for attending today's presentation. That now concludes today's session. So good morning to you all.