American Resources subsidiary develops rare earth refinery By Investing.com
FISHERMEN, CENTRAL – American resources (NASDAQ:) Corporation (NASDAQ:AREC) announced through its subsidiary ReElement Technologies Corporation, a major advance in the production of rare earth elements from mine waste. Its subsidiary has demonstrated a proprietary process that allows the extraction of rare earth oxides (MREO) mixed with carbon waste streams, with concentrations exceeding 500 parts per million. According to InvestingPro data, the company, currently valued at $95.23 million, faces significant operational challenges with an EBITDA of $23.16 million over the past twelve months.
The company’s internal auditors found more than 128 million tons of previously released waste available for processing, with a focus on approximately 8 million tons from their West Virginia facility. This development could prove to be a breakthrough in the industry, providing a sustainable and inexpensive source of rare earth materials, important for various technologies including electric vehicles and electronics. However, InvestingPro’s analysis reveals some financial metrics, including a current ratio of 0.23 and a large debt load of $229.89 million, that may impact the company’s ability to take full advantage of this opportunity.
Mark Jensen, CEO of American Resources, emphasized the economic viability of using the byproduct economy and coal waste to produce rare earth oxide. He emphasized the potential benefits of the battery and defense sectors due to the high concentration of aluminum oxide and silicon dioxide in the waste.
ReElement’s refining platform aims to provide a strong independent precious minerals supply chain outside of China, currently refining over 90% of the world’s rare earths. The company’s purification process, which includes Ligand Assisted Displacement (LAD) Chromatography, is considered a cost-effective and environmentally safe alternative to conventional methods.
The development comes amid escalating trade tensions between China and the United States, particularly over key minerals. China’s recent ban on exports of some precious minerals and the importance of dysprosium in advanced semiconductor production underscore the strategic importance of ReElement’s domestic refining capabilities.
ReElement is expanding its operations, including a partnership with the American Infrastructure Corporation, to refine concentrated rare earth elements into ultra-pure products. The subsidiary also provided updates on its Marion, Indiana, facility, which is poised to become the world’s largest integrated rare earth and lithium refinery in the United States.
This press release indicates that ReElement Technologies, through its innovative refining process, is well positioned to address supply chain challenges and national security challenges by providing a domestic source of rare earths and valuable minerals. Although the company’s strategic position seems promising, InvestingPro data shows significant challenges in revenue with a 98.13% decline in the last twelve months. InvestingPro subscribers can access 12 other key insights and a comprehensive Pro Research Report, which provides a detailed analysis of AREC’s financial health and growth prospects.
In other recent news, American Resources Corporation detailed key strategic developments and progress toward multiple public listings during its 2024 Third Quarter Earnings Call. The company highlighted upcoming spin-offs ReElement Technologies and American Infrastructure, with ReElement set for a public listing as soon as December 2024. Despite market challenges, American Resources expressed confidence in its growth potential.
The company also discussed its transformation, focusing on environmental remediation, production of rare earth elements, and profitability of the carbon metallurgical market. American Infrastructure is switching to a royalty-based model, while American Metals is partnering with LOHUM Cleantech on battery recycling. The company is working on a merger with AI Transportation Acquisition Corp. and plans to move around American steel.
ReElement Technologies is developing a new facility in Marion, Indiana, targeting revenue growth through 2025 and preparing for a public listing. Despite the challenges in the current market environment and the delay in the public listings of Novusterra and American Carbon due to audit challenges, the company remains optimistic about potential profits. These are some of the recent developments of American Resources Corporation.
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