May 11 (Reuters) - Mineral sands explorer Iluka Resources ILU.AX said on Tuesday the Australian government had notified it that its proposed rare earths refinery at Eneabba would be in line with the country's critical minerals policy.
Two federal ministers said in a letter that the processing plant in Western Australia could help develop new mines, move the country "further along the rare earths value chain", and "build security in the global supply of critical minerals".
A threat of supply disruptions from China has in recent years pushed the likes of Australia and the United States to ramp up their own capabilities.
China is the world's largest producer of rare earth minerals that are used in a wide range of gadgets and some weapon systems.
The letter said the federal government would consider options for further support to the project, and noted the company's application for a non-recourse loan to export credit agency Export Finance Australia.