St George Mining Limited (ASX: SGQ) (“the Company”) has confirmed a significant new discovery of high-grade rare earth elements (REE) and niobium at its 100%-owned Araxá Project in Minas Gerais, Brazil.
Breakthrough Discovery at East Araxá
The first batch of reverse circulation (RC) drill assays outside of the existing Mineral Resource Estimate (MRE) delivered standout results, with thick, high-grade intervals confirming the scale of this new zone.
Key highlights include:
- 48m at 5.71% TREO from 2m, including 15m at 12.61% TREO.
- 32m at 1.04% Nb₂O₅ from 11m, including 6m at 2.41% TREO.
- 40m at 2.62% TREO and 1.05% Nb₂O5 from surface, including 8m at 4.38% TREO.
Grades reached as high as 16.87% TREO (168,700ppm) and 4.06% Nb₂O₅ (40,600ppm).
John Prineas, Executive Chairman, said: “We are delighted with the results from the follow-up deeper drilling at East Araxá which has confirmed the continuity and depth extent of this near-surface, high-grade rare earths and niobium discovery.”
Figure 1: Enhanced Magnet Rare Earth and Niobium Potential
The assays show high proportions of magnet rare earths. NdPr values were recorded up to 3.96% (39,600ppm), while heavy rare earths such as Dysprosium, Terbium, Lutetium, and Gadolinium combined for 1,500ppm of TREO. Samarium values were also exceptionally strong, reaching up to 2,600ppm.
Mr. Prineas noted the strategic importance of these results: “The high proportion of magnet rare earths – both light and heavy REEs – at East Araxá is very impressive. The USA has relied on magnets – even for the powerful Samarium Cobalt magnets used in F-35 fighters – from China. St George, through its downstream strategic alliance in the US, is perfectly positioned to contribute to establishing a US domestic supply chain for these important magnets.”
Figure 2: Role of Samarium in F-35 fighter jets
Strategic Advantage of Araxá
The Araxá Project is the largest and highest-grade carbonatite-hosted REE deposit in South America and the second highest-grade REE deposit in the Western world. Current resources stand at:
- 40.6Mt at 4.13% TREO.
- 41.2Mt at 0.68% Nb₂O₅.
Figure 3: Comparative benchmarking of leading hard-rock rare earth deposits outside China.
Mr. Prineas emphasised: “The volume of mineralisation being defined by the RC drilling in this new area – located 1km east of the MRE envelope – points to the potential for a significant addition to the Araxá MRE, already the highest grade undeveloped JORC-compliant rare earths resource globally.”
Mineralisation begins at surface, which supports the potential for a low-cost open-pit operation. With established infrastructure and strong government support, the Company has a clear development pathway.
Global Market Context
The timing of this discovery aligns with growing global demand for critical minerals.
- Rare Earth Elements (REE): Valued at USD 3.95 billion in 2024, the REE market is projected to reach USD 6.28 billion by 2030, at a CAGR of 8.6% from 2025. A supply glut and geopolitical tensions with China drove a 2022 price spike, boosting revenues through 2023.
- Niobium: Valued at USD 2.08 billion in 2024, the niobium market is forecast to reach USD 3.23 billion by 2032, growing at 6% CAGR. Demand for high-strength, lightweight alloys in aerospace, automotive, and electronics underpins this growth.
Partnership and Defence Applications
Partnership of St George with REAlloys Inc.
The Company’s strategic alliance with US-based REAlloys Inc., which has defence supply contracts, positions Araxá as a potential long-term contributor to Western supply chains. Rare earth oxalate from the Project will undergo testwork by REAlloys, with potential offtake agreements to follow.
Defence Applications of Rare Earth Oxides
This has direct implications for defence industries, given the use of REEs in F-35 fighter jets, Virginia-class submarines, and Arleigh Burke destroyers. An F-35 fighter jet incorporates approximately 418 kg of REEs. These materials are critical for the jet’s guided missile systems, as well as the high-powered lasers used to identify and lock onto targets. The reliance on REEs ensures the F-35 maintains its edge in stealth, targeting, and flight performance.
An Arleigh Burke DDG-51 destroyer consumes about 2,600 kg of REEs. These are essential for advanced radar systems that provide situational awareness, as well as missile guidance and ship propulsion. Without REEs, such vessels would lose much of their technological advantage in naval warfare.
The demand is even greater in a Virginia-class submarine, which requires nearly 4,600 kg of REEs. They are vital for the submarine’s Tomahawk missile systems, radar operations, and drive motors that demand both power and stealth.
Figure 5: Defence Applications of REEs
Market Reaction
The ASX market showed strong momentum following the discovery announcement. At 1:12 pm AEST on 17 September 2025, SGQ shares were trading at $0.088, up 12.82% intraday.
Recent performance remains impressive:
- +39.68% in one week.
- +128.57% in one month.
- +252% year-to-date (YTD).
- +183.87% year-on-year, outperforming both the sector (+171.26%) and the ASX 200 (+172.36%).
The Company’s market capitalisation now stands at $257.1 million, reflecting the strong investor confidence generated by the Araxá Project’s high-grade rare earths and niobium discovery.
Investor Outlook
The Company’s ongoing multi-rig campaign – with three diamond rigs drilling around the clock and RC drilling expanding at East Araxá – promises a strong pipeline of news. Over 8,000m of drilling remains, with further assays due in coming weeks.
Mr. Prineas concluded: “This is an incredibly exciting time for St George. We look forward to reporting further drill results and project milestones as we continue to build shareholder wealth from Araxá.”
With strategic partnerships, government support, and exposure to markets vital for global decarbonisation, defence, and advanced manufacturing, St George Mining stands out as a compelling critical minerals investment.
