Nysnø invests in the technology company REEtec AS

Stavanger 08 November 2022 - REEtec has developed a new separation technology for environmentally friendly and efficient processing of rare earths elements, used in growth markets within the energy transition. The company is now raising NOK 1.2 billion from LKAB, Nysnø Climate Investments, Mercuria, Techmet and existing shareholders to build a full-scale industrial plant at Herøya.

The European Commission considers rare earth elements to be a significant input factor towards climate neutrality by 2050. These are used in most modern technology and are considered some of the most critical raw materials in the green transition. REEtec focuses on the rare earth elements Neodymium and Praseodymium (NdPr) which among others are used in wind turbines, electric car engines, robots, and pumps. The market for NdPr is expected to quintuple to USD 33 billion by 2030, primarily driven by growth in electric mobility and wind power.

The company is raising NOK 1.2 billion for the development of a full-scale industrial processing facility at Herøya. Nysnø is investing NOK 100 million in this investment round, being led by the Swedish mining and mineral group LKAB, and with participation from the commodity trading company Mercuria, TechMet and existing shareholders .

"European governments and businesses aim to reduce dependence on imports. The European Commission considers rare earth elements to be critical towards reaching climate neutrality by 2050. We look forward to having Nysnø as a strategic investor on the team and, together with our other shareholders, create a leading European player in rare earth elements”, says John Andersen, Chairman of the Board of REEtec and CEO of Scatec Innovation.

The rare earth element value chain is today heavily concentrated in China, with an 80 – 90% market share. The current production is very CO2 intensive, and REEtec estimates that their new process where all inputs are reused will reduce the CO2 emissions by 90% compared to other leading producers.

From the second half of 2024, the Herøya production plant will have a capacity of 720 tonnes NdPr per annum. This represents about 5% of the estimated demand in the EU. The raw material, which is a concentrated mixture of various rare earth elements will be supplied by the Canadian mining company Vital Metals. Sales agreements have already been signed with industrial European customers.

"REEtec has a clear plan and strategy for profitable growth. We strongly believe that the company will achieve a successful scale-up of industrial plants that provide reduced greenhouse gas emissions and attractive risk adjusted returns”, says Bertel Ånestad, Investment Director in Nysnø.

"In addition to providing major reductions in greenhouse gas emissions, the REEtec process will significantly reduce HSE risk. A positive effect by establishing this type of industry in Norway, is contributing to moving the processing of important materials to Europe and making the continent more self-sufficient in strategically important raw materials”, says Ånestad.

Rare earth element resources in Norway, Sweden and Finland makes the Nordics an attractive region with the potential to build a sustainable and complete value chain for mineral extraction, separation, and processing to metal and magnets close to a large and growing European market.

Nysnø Climate Investments invests NOK 100 million in REEtec AS. The Swedish state-owned mining company LKAB enters as the main investor, along with other investors such as the commodity trading company Mercuria (Switzerland) and Techmet (USA, partly owned by the US International Development Finance Corporation). Other existing shareholders in the company are Scatec Innovation AS, Roht Invest, Brennebu AS and Bergfald Holding.

Contact persons:

Bertel Ånestad, Investment Director, Nysnø Climate Investments
Tel: +47 97 01 04 11, bertel@nysnoinvest.no

John Andersen, Chairman of the Board, REEtec, Tel: +47 90 17 40 80, John.Andersen@scatec.no