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Mining For Sustainability: Mkango's HyProMag USA Project Gains Momentum

AInvestThursday, Dec 5, 2024 2:33 am ET
4min read


Mkango Resources Limited, a leading player in the critical mineral sector, recently announced its intent to appoint an Engineering, Procurement, and Construction Management (EPCM) provider for its HyProMag USA project. This strategic move signifies the company's commitment to advancing its rare earth magnet recycling and manufacturing venture in the United States. The project, which aims to establish a low-cost, low-carbon, and sustainable supply of rare earth magnets, has the potential to significantly impact the domestic magnet market and contribute to the nation's mineral security.

HyProMag USA is a joint venture between Mkango and CoTec Holdings Corp., formed to roll out HyProMag's Hydrogen Processing of Magnet Scrap (HPMS) recycling technology in the United States. This innovative process, developed at the University of Birmingham, offers a more efficient and environmentally friendly alternative to traditional chemical recycling methods. By liberating magnets from end-of-life scrap streams, HPMS enables the production of recycled rare earth magnets with a significantly reduced carbon footprint.

The appointment of an EPCM provider marks a critical milestone in the project's development, as it paves the way for the detailed engineering design, procurement, and construction management phase. This process will involve completing sufficient engineering design works to support the development of an AACE Class 1 capital cost estimate, allowing for a more accurate and refined budget. The EPCM provider will also play a crucial role in supporting final site selection efforts, ensuring an optimized location for the project's hub and spokes, and enabling the commencement of site permitting in line with the initial project schedule.



The feasibility study for the HyProMag USA project, conducted by independent engineers BBA USA Inc. and PegasusTSI Inc., demonstrated robust economics and the opportunity to develop a major new domestic source of recycled rare earth magnets for the United States. The study highlighted a post-tax Net Present Value (NPV) of US$503 million and a 31% real internal rate of return (IRR) at forecast prices, as well as a 23% real IRR at current prices. The project is expected to create approximately 90 jobs across Texas, South Carolina, and Nevada, contributing to the revitalization of NdFeB magnet production in the United States.

As Mkango and CoTec proceed with the EPCM selection process, they will prioritize several key factors when evaluating bids from potential providers. Experience and expertise in rare earth magnet recycling and manufacturing, competitive and accurate cost estimates, alignment with the project's timeline, strong technical capabilities, and a proven track record of reliability and success will all be crucial considerations. By selecting a capable and experienced EPCM provider, Mkango and CoTec aim to minimize capital expenditure and operating costs, maximize the project's economic and environmental benefits, and ensure the success of the HyProMag USA venture.



The HyProMag USA project represents a significant opportunity for Mkango and CoTec to contribute to the United States' mineral security and support the nation's critical technology industries. As the demand for rare earth magnets continues to grow, driven by applications in defense, aerospace, automotive, and energy transition sectors, the establishment of a sustainable and cost-effective domestic supply chain becomes increasingly important. By advancing the HyProMag USA project, Mkango and CoTec are not only investing in the future of the rare earth magnet industry but also contributing to a more sustainable and secure energy landscape.
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