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The project is expected to create 490 jobs and will be supported by recently approved CHIPS Act funding. The U.S. government will become one of the company’s largest shareholders.
- USA Rare Earth will invest $1.2 billion to establish a magnet manufacturing and refined metals operation in Blacksburg, South Carolina, the critical minerals company said Tuesday. It is targeting a 2028 commissioning date, with plans to begin site work in the coming months.
- The project, slated for Bailey Industrial Park, is expected to create 490 jobs and expand domestic production for sintered neodymium-iron-boron (NdFeB) permanent magnets and refined rare earth metals.
- USA Rare Earth on Wednesday said it reached definitive agreements to receive up to $1.6 billion in funding from the U.S. Department of Commerce’s CHIPS program for its Blacksburg facility and other projects underway. In exchange, the U.S. government will receive 16.1 million shares, making it one of the largest company stakeholders.
Dive Insight:
Founded in 2019, USA Rare Earth is focused on developing a domestic “mine-to-magnet” supply chain independent from China. Its U.S. operations span mining, separation, metal production and magnet manufacturing, according to the company’s website.
USA Rare Earth also has operations in the United Kingdom and recently struck a $2.8 billion deal to acquire Serra Verde Group, which owns a Pela Ema rare earth mine and production plants in Goiás, Brazil. Additionally, it has a rare earth metal and alloy project underway in Lacq, France.
The Blacksburg project would expand USA Rare Earth’s domestic metal magnet capacity. USA Rare Earth plans to produce 6,400 metric tons of NdFeB magnets and 5,000 metric tons of strip cast, metal and alloy at the facility per year. Engineering work and equipment procurement is underway.
CEO Barbara Hampton described the project as “the next critical link” in the company’s global rare earth and magnet supply chain.
Once completed, the location will conduct electrolysis, heat treatment, jet milling, machining and coating, among other tasks, according to the South Carolina Department of Commerce. The magnets and refined metals produced there are expected to support advanced manufacturing industries, including defense, aerospace, semiconductor, medical, artificial intelligence and energy.
“South Carolina offered the workforce, the infrastructure and the partners we needed to move quickly,” Hampton said in a statement. “With this investment, we’re bringing home the advanced manufacturing capabilities that America and its allies depend on, from the factory floor to the front lines.”
In March, USA Rare Earth began commissioning its first commercial production line at its magnet manufacturing plant in Stillwater, Oklahoma, which is being expanded. Together with the Blacksburg facility, the company said it will aim to produce 10,000 metric tons of NdFeB magnets and 10,000 metric tons of strip cast, metal and alloy per year.
The company chose Blacksburg after evaluating multiple states for the project. During the search, it said it considered incentives like grants, tax credits and exemptions, access to reliable and affordable power, proximity to a skilled workforce and other factors. Duke Energy agreed to provide utility services to the facility.
South Carolina’s Coordinating Council for Economic Development approved job development credits related to the project. A spokesperson declined to say how much was approved for the project.
USA Rare Earth on Wednesday said it reached definitive funding agreements with the Commerce Department regarding a number of investment projects, including the development of the Round Top mineral deposit and processing output in Hudspeth County, Texas; reshoring of capacity through subsidiary Less Common Metals; and scaling of magnet capacity in Stillwater and Blacksburg.
“This partnership with the U.S. government is the largest of its kind in our industry and provides the necessary capital to build the only global platform across light and heavy rare earth mining and processing, metal and alloy making, as well as magnet manufacturing — for the benefit of the United States and its allies,” Michael Blitzer, board chairman of USA Rare Earth, said in a statement.
The agreements provide access to up to $277 million in federal funding and up to $1.3 billion in senior secured loan capacity under the CHIPS Act. In exchange, USA Rare Earth will issue 16.1 million shares of common stock to the U.S. government and 17.6 million warrants, according to an investor filing. The funding will be disbursed in phases and is tied to project milestones.
USA Rare Earth plans to deploy up to $3.5 billion developing and expanding its rare earth supply chain through a mix of federal funding and private capital. It closed on a $1.5 billion fundraising round in January.
Source: Manufacturing Dive
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