Arafura Rare Earths Pulls Off A$375M Equity Raise to Fund Nolans, Hancock Prospecting Adds to Stake

Arafura Rare Earths finalizes A$375M equity raising for Nolans project in Northern Territory, backed by Gina Rinehart and federal government, securing 80% offtake for NdPr output.

Arafura Rare Earths has crossed its biggest financial hurdle, hammering down a A$375mn equity injection to fire the starting gun on the Nolans rare earths project in Australia’s Northern Territory. The capital raising follows the company’s final investment decision on 21 May and secures the last piece of a funding jigsaw that has drawn in the federal government and Australia’s richest woman.

Trading in Arafura’s shares was halted on the ASX ahead of the transaction, which is split between an institutional placement worth A$350mn and a share purchase plan open to retail investors for the remaining A$25mn. The new equity is priced at A$0.26, a chunky 16% discount to the last closing price – a dilution that existing holders will have to swallow. Management expects the suspension to last until next week, by which time the placement is expected to be formally confirmed.

Behind the raise stands a familiar name: Gina Rinehart’s Hancock Prospecting is tipping in roughly A$85mn through the placement, boosting its stake from 15.5% to an anticipated 17.5%. The mining magnate’s deepening commitment underlines the project’s strategic heft as the West scrambles to break China’s grip on the rare earths supply chain.

Nolans is designed as Australia’s first fully integrated ore-to-oxide rare earths operation, with a nameplate capacity of 4,440 tonnes per year of neodymium-praseodymium oxide (NdPr) – the critical input for permanent magnets used in electric vehicles and wind turbines. The mine carries a 38-year life and is expected to supply roughly 4% of global NdPr demand. By-products will include 470 tonnes per annum of mixed middle-heavy rare earth oxide and 144,000 tonnes of phosphoric acid-based fertiliser.

The funding ensures Arafura can meet the project’s estimated A$1.6bn capital cost. Following the equity raise, the company’s cash position will stand at around A$911mn. Crucially, Arafura already has buyers locked in for 80.4% of its NdPr output, with binding offtake agreements covering 3,570 tonnes per year. Clients include Traxys North America (500t), Traxys Europe (up to 300t), South Korean automaker Hyundai and German industrial giant Siemens.

Canberra has also chipped in materially. The federal government is contributing A$200mn through the National Reconstruction Fund, while Export Finance Australia has offered non-binding support for an additional 500 tonnes of NdPr offtake.

The project will generate 600 construction jobs and 350 permanent operational roles. Earth-moving equipment is set to roll in from September 2026, with first production penciled in for early to mid-2029. Arafura now has the capital, the offtake and the political backing to turn the red dust of the Northern Territory into a rare earths hub outside Beijing’s orbit.