On the back of Mt Weld, Lynas Rare Earths has built its reputation as the leading producer outside China, and says it is the only commercial producer of separated light and heavy rare earth oxides outside China.
Now it has agreed to buy something quite different. Lynas has signed a binding scheme implementation deed to acquire Meteoric Resources in an all-share deal valued at $968 million. The prize is Meteoric’s Caldeira project in Brazil, which hosts both light and heavy rare earths and would become Lynas’ second major resource base, albeit a different deposit type, at an earlier stage of development and in a different country.
Why is Lynas looking to reshape its business and existing supply chain?
Lynas’ business today is a single chain, spanning ore from Mt Weld in Western Australia, which is processed at the Kalgoorlie Rare Earths Processing Facility, then separated and finished at its Advanced Materials Plant in Kuantan, Malaysia. It produced 13,089 tonnes of rare earth oxides in FY26, including 7260 tonnes of NdPr, the magnet rare earths used in electric vehicle motors and wind turbines, and ended June with A$1.2 billion in cash. Heavy rare earths remain small, at 19 tonnes of dysprosium and terbium in the June quarter.
It is also pushing into heavy rare earths after it first produced separated dysprosium and terbium in FY25 and added samarium in March 2026. However, volumes are still small: 19 tonnes of dysprosium and terbium in the June quarter.
Its Towards 2030 growth strategy calls for adding resource and scale, and Caldeira, which Lynas says is the “largest known ionic clay JORC rare earth oxide mineral resource outside China”, fits that. Lynas chair Professor John Humphrey said expanding into a new country would help it “maintain its leading position in the global rare earths supply chain”.
Caldeira sits in the Poços de Caldas alkaline complex in southwest Minas Gerais. It is an ionic adsorption clay deposit, where rare earths cling to clay particles and can be released with a salt solution rather than blasted, crushed and floated from hard rock. Its ore reserve averages 3524 parts per million total rare earth oxides, or about 0.35 per cent, compared with Mt Weld, which Lynas calls high grade.
The case rests on cost and scale. Meteoric’s July 2026 definitive feasibility study outlines a 151Mt probable ore reserve, average annual production of about 12,500 tonnes of total rare earth oxides, including 3862 tonnes of NdPr and 127 tonnes of dysprosium and terbium, for more than 20 years, and initial capex of about $US498 million. Those are targets rather than results, and depend on a final investment decision and market conditions.
Brazil ranks behind China as the world’s second-largest holder of rare earth reserves. Brazil is widely ranked second behind China for rare earth reserves. Estimates vary: recent reporting cites a US Geological Survey estimate of about 11 million tonnes, while earlier USGS material puts the figure at 21 million tonnes. China itself accounts for roughly 60 per cent of mined rare earth output and more than 90 per cent of refining capacity.
Caldeira sits in the Poços de Caldas alkaline complex in southwest Minas Gerais. It is an ionic adsorption clay deposit, meaning the rare earths cling to clay particles and can be released with a salt solution rather than blasted, crushed and floated from hard rock. That is a different proposition from Mt Weld, and a very different grade: Caldeira’s ore reserve averages 3524 parts per million total rare earth oxide, or about 0.35 per cent. Lynas said Caldeira could feed its Malaysian operations and that it will study downstream processing in Brazil, but has put no cost or timetable on either.
The case for the project rests on cost and scale. Meteoric’s July 2026 definitive feasibility study (DFS) outlines a 151Mt probable ore Reserve, average annual production of about 12,500 tonnes of total rare earth oxides, including 3862 tonnes of NdPr and 127 tonnes of dysprosium and terbium, for more than 20 years, and initial capex of about $US498 million. Meteoric also lifted Caldeira’s measured resources 246 per cent to 128Mt in July.
The production target is based on probable ore reserves, and both companies caution that actual rates and costs depend on a final investment decision and market conditions.
Caldeira’s mineral rights also depend on a contract. Under an agreement with Brazilian company Togni S/A – Materiais Refratários, Meteoric holds the exclusive right to explore, develop and mine rare earths at Caldeira. Until now, Togni could terminate if production hadn’t started by April 2031. As part of the Lynas deal, Meteoric has agreed to push that out two years, to April 2033.
Meteoric shareholders would own about 5.9 per cent of Lynas, and the A$968 million value is struck on Lynas’ 60-day average share price, so it will move with Lynas’ shares. Meteoric’s board has unanimously recommended the scheme in the absence of a superior proposal, provided an independent expert continues to find it in shareholders’ best interests. A scheme booklet is due in December, with a meeting in January 2027 and implementation by March if shareholders, the court and Brazilian regulators approve.
The deal also comes at an interesting time for Brazil’s domestic rare earths sector, given that Serra Verde, whose Pela Ema mine and processing plant in Goiás are also ionic clay operations, was agreed to be purchased by USA Rare Earths in April. The US-based company described Serra Verde as the only scaled producer of all four magnetic rare earths outside Asia, backed by a 15-year, 100 per cent offtake agreement with price floors. Serra Verde’s chief executive, Thras Moraitis, became USA Rare Earth’s chief executive from 1 October.
What happens next will test whether Lynas can run an ionic clay project as well as it runs Mt Weld. Meteoric executive chair Dr Andrew Tunks said Lynas brings what Caldeira needs.
“Lynas brings technical expertise, global credibility and balance sheet strength to fast-track the development of Caldeira,“ he said.
“Together we see a long future leading the development and industrialisation of the rare earths industry in Brazil.“
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