Australian Strategic Materials Ltd (ASX:ASM, OTC:ASMMF) is looking to bolster its access to rare earth elements (REE) by way of a potential joint venture with Caspin Resources Ltd (ASX:CPN) which would see it earn up to 75% of the REE rights at Caspin’s Mount Squires Project in the West Musgrave region of Western Australia.
The two companies have executed an exclusive option agreement to progress the collaboration plan, which is consistent with ASM’s mine-to-metals strategy.
Significantly for ASM, the supplementary rare earth supply from Mt Squires includes a significant proportion of high-value heavy rare earths.
Subject to metallurgical testing and drilling, this source may be suitable for processing at ASM’s planned separation and refining facility at the Dubbo Project in Central West New South Wales.
“Aligns with our strategy”
ASM managing director and CEO Rowena Smith, said: “We are pleased to collaborate with Caspin to identify further raw material supply for ASM’s Dubbo Project separation and refining facility.
"This opportunity aligns with our mine-to-metals strategy to broaden our rare earth supply, particularly for high-value heavy rare earths.
"Additionally, we see real value in developing the Dubbo Project as a rare earth separation and refining hub with the ability to unlock value for potential rare earth projects across Australia.”
High-value heavy REEs
Drilling programs have been undertaken by Caspin at its 100%-owned Mt Squires Project that have demonstrated REE results including a significant proportion of high-value heavy REE.
A mineralogical study indicates REE mineralisation is hosted predominately in monazite, a common REE ore mineral, with positive implications for metallurgical testing.
Caspin has steadily advanced its understanding of the REE mineralisation and recognised the potential for further discoveries at Mt Squires, which is adjacent to the western border of BHP’s West Musgrave Project hosting the large Nebo-Babel nickel-copper sulphide deposits, about 1,700 kilometres northeast of Perth.
Staged earn-in rights
The agreement with Caspin Resources provides ASM with an option to earn up to 75% of the REE rights at Mt Squires through staged earn-in rights.
Subject to confirmation from metallurgical testing, the REE from the project may be converted to a concentrate form and then processed through the Dubbo Project separation and refining facility to create high-purity rare earth oxides.
In line with the option agreement, ASM will undertake metallurgical testing and drilling programs over the next 3-9 months to identify this potential before deciding whether to exercise its option to enter into a joint venture agreement with Caspin.
About Caspin Resources
Caspin is a mineral exploration company based in Perth, Western Australia. It has extensive skills and experience in early-stage exploration and development of precious and critical metals.
The company is actively exploring the Yarawindah Brook Project in the West Yilgarn province and the Mt Squires greenfield-style gold and base metal project in the West Musgrave region, one of Australia’s last mineral exploration frontiers.
Caspin discovered significant REE mineralisation on the project in 2023, the first discovery of REE in the West Musgrave Province.