RER secures funding

Alexis Barker
NLJ News Editor
 
Rare Element Resources is one step closer to constructing its demonstration scale rare earths separation and processing plant at the Upton industrial park, after a successful closing of their rights offering last week. 
RER is a publicly traded, strategic materials company focused on delivering rare earth products for technology, energy and defense application. They are doing so by advancing the Bear Lodge Critical Rare Earth Project in northeast Wyoming. 
Bear Lodge is a significant mineralized district, according to information on the company, “containing many of the less common, more valuable, critical rare earths that are essential for high-strength permanent magnets, electronics, fiber optics, laser systems for health and defense, as well as many technologies like electric vehicles, solar panels and wind turbines.”
“The offering was oversubscribed and produced approximately $25.1 million in net proceeds,” said George Byers, a consultant to RER. “This sum, along with the $21.9 million award from the U.S. Department of Energy that was announced earlier this year, will be employed in constructing and operating the Upton facility.”
According to a press release dated Dec. 10, RER plans to use the net proceeds for the permitting, licensing, engineering, construction and operation of the demonstration plant. It notes that a portion will be used for prepayment of outstanding indebtedness of approximately $1 million. 
“Plant design is already underway. This work, as well as licensing, engineering, construction and operation, are expected to take approximately 40 months,” Byers said. “Ore that has been recovered and stockpiled at the Bull Hill mine site in adjoining Crook County, north of Sundance, will be processed at the plant.” 
Preliminary results of the rights offering indicate that the company will be issuing approximately 105.8 million common shares, including about 85 million common shares to be issued to holders who exercised their basic subscription privilege at $0.24 per share, according to the press release.
“Of the total shares to be issued, approximately 65.5 million common shares are expected to be issued to the company’s significant shareholder, Synchron, which exercised its basic subscription and oversubscription privilege in full,” the press release states. After the offerings are issued, Synchron will own approximately 54.8% of the common outstanding shares. 
The results of the rights offering, according to the release, are subject to finalization and verification by the subscription agent. 
Byers said that the company’s commitment to Wyoming is now stronger than ever and that the Upton plant will be fully capable of processing ore from not only the Bear Lodge Mine but also ore from third-party sources.