Neo Material Technologies Inc (TSX: NEM) said it signed a Memorandum of Understanding with Mitsubishi Corp with the aim of establishing a strategic partnership for the identification, development and commercialization of rare earth resource opportunities outside of China.
Under the terms of the agreement, Mitsubishi will fund up to US$2.5 million of all costs associated with Neo's development of the heavy rare earth resource at the Pitinga tin mine in Brazil owned and operated by Mineracao Taboca. In return, Neo is to work towards securing a portion of all mixed rare earth concentrate produced from Pitinga foe Mitsubishi.
In the event that Neo decides to construct and operate a rare earth processing plant anywhere outside the People's Republic of China, Mitsubishi has committed to a minimum participation of 20 percent in such new facilities. In return, Mitsubishi will have the right to purchase no less than 20 percent of the annual output of separated rare earths from such plants.
In addition to Neo's Pitinga project, Mitsubishi and Neo will continue to collaborate on the identification and development of rare earth resources around the world, which fit their criteria of by-product economics and heavy rare earth mineralization.
Neo president and CEO Constantine Karayannopoulos said: "Mitsubishi Corporation shares the same vision as Neo for the long-term robust demand for high value rare earths, and, particularly the importance of securing a long-term global supply of such materials for the further development and growth of electric and hybrid electric vehicles and other key environmentally-friendly applications.”http://www.proactiveinvestors.com
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