PEAK RARE EARTHS LIMITED Peak Rare Earths Limited announced the signing of an offtake and strategic co-operation Memorandum of Understanding (MOU) to support the development of the Ngualla Rare Earth Project (Ngualla Project) with Shenghe Resources (Singapore) Pte Ltd, a wholly owned subsidiary of global rare earths company, Shenghe Resources Holdings Co. (Shenghe). As part of the MOU, Shenghe will purchase 75% - 100% of the production from the Ngualla Project, which may include a high-grade mineral concentrate and/or a mixed-rare earth carbonate ("MREC").
Key terms relating to this offtake agreement include: An initial period of 7 years; with may be extended further by the mutual agreement; and An arms-length market-based pricing principle based on the value of contained rare earth oxides within the product. Following the execution of the MoU, Peak and Shenghe will negotiate in good faith towards a binding offtake agreement that supports project financing requirements for the Ngualla Project. Other key elements of the MOU include the following: The potential for technical co-operation on relevant aspects of the Ngualla Project including in relation to rare earth mining and beneficiation processes, in accordance with arms-length market principles; The potential for Shenghe to acquire a direct interest in the Ngualla Project at a mutually agreed valuation; · The right for Shenghe to appoint one Non-Executive Director to the Board of Peak, subject to Shenghe maintaining a shareholding of at least 10%; and The MOU has an initial term of 12 months.
