"Awarding the contract for the detailed design of the processing plant is yet another significant step forward in the execution of our plan to become a fully integrated rare earth producer by early 2013," said Great Western Chief Executive Jim Engdahl in a statement.
The processing plant, expected to complete by the end of the year, will be built at the Steenkampskraal mine site.
The company, which has exploration and development properties in North America, said this is the first step in the production process where rare earth ore is converted into rare earth chlorides.
DRA, which has constructed plants on five continents, is a multi-national organization specializing in the mining, infrastructure and mineral processing industries.
"Contracting DRA, with its strong track record of superior performance, ensures we can achieve world class design and construction standards within the processing plant, combined with cutting edge technology," Engdahl added.
The plant will "crack" the monazite ore through a caustic leaching process, removing copper and gold by flotation. Additionally, Tri-sodium phosphate will be produced as a by-product with the potential for onward sales.
Further, the thorium found in the rare earth ore will be removed during the processing stage and be prepared for licensed storage, leaving a clean rare earth chloride ready for the solvent extraction separation phase.
Earlier this week, Great Western announced a joint venture with Ganzhou Qiandong Rare Earth Group Ltd in relation to the processing plant.
A new joint venture company, to be called Great Western GQD Rare Earth Materials Co., will be created. Of which Great Western will own 75%, while Chinese rare earths processor Ganzhou Qiandong will own the rest. The agreement will be formalised in August.
Great Westerns shares were inactive during pre-market trade on Wednesday, but closed Tuesday at $0.980 on the Toronto Stock Exchange.