St George Mining Limited (ASX: SGQ) (“St George” or “the Company”) has signed a Memorandum of Understanding (MoU) with U.S.-based REAlloys Inc. (“REAlloys”) a downstream magnet material, critical metals and alloys manufacturing company based in Ohio, U.S., to commercialise the high-grade rare earths at St George’s world-class Araxá Project. It allows both companies to advance commercialisation of Araxá’s high-grade resources.
Key Workstreams
The MoU outlines several important collaboration areas:
Figure 1: Key Workstreams Under the MOU
- Metallurgical testing: REAlloys will complete metallurgical testing on rare earth materials from Araxá to maximise magnet element recovery.
- Technology review: Both companies will review proposed production technologies for rare earths products at Araxá, with access to REAlloys’ patented, industry-leading systems.
- Flowsheet optimisation: Both companies will review the processing flowsheet for rare earth products at Araxá for manufacturing products most suited to magnet production.
- Offtake negotiations: Both companies will also review marketing strategies for rare earth products from Araxá. Additionally, REAlloys may secure up to 40% of future rare earths production from Araxá.
John Prineas, St George Mining’s Executive Chairman, commented “We are extremely excited to enter into this strategic alliance with REAlloys, which greatly bolsters the development potential for the rare earths opportunity at our 100%-owned Araxá Project. “REAlloys is one of the leading suppliers of high-performance rare earths magnet materials to the U.S. defence and industrial sectors, which means this strategic alliance creates an attractive pathway for St George to access the fast-growing and lucrative downstream sector of the U.S. rare earths industry.”
The MoU provides a framework but does not bind either party to exclusivity. The alliance will lapse if a formal offtake agreement is not reached within 120 days.
Why the Alliance Matters
The MoU with REAlloys positions the Company at the centre of the evolving global rare earths supply chain. The rare earths market was valued at USD 3.95 billion in 2024. It is projected to grow at a CAGR of 8.6% between 2025 and 2030, reaching USD 6.28 billion by 2030.
Figure 2: Projected Growth of the Rare Earths Global Market
Asia-Pacific was the dominant region in the global supply chain, securing a revenue share of >86% in 2024. These materials are required to produce permanent magnets and battery alloys, which have many applications (see Figure below). China is the largest producer and consumer of rare earths. In addition, the ongoing geopolitical tensions between the U.S., China, and Europe have opened opportunities for new producers.
Figure 3: Global Applications of Rare Earth Elements. (EVFS = electric vehicle and future systems)
By partnering with a U.S. Government magnet supplier, St George gains access to downstream markets critical to defence, aerospace, and clean energy. Araxá’s high-grade resources provide a secure source of supply at a time nations are seeking alternatives. This agreement enhances the Company’s ability to support diversified supply chains while cementing its role as a trusted provider of strategic minerals.
The MoU connects St George with a leading US magnet materials supplier. REAlloys produces critical neodymium iron boron (NdFeB) and samarium cobalt (SmCo) magnets.
REAlloys: A Robust Partner
REAlloys is an integrated producer of high-performance magnet materials. Its facility in Ohio, U.S., holds advanced metallisation and alloying capabilities. These support the production of critical NdFeB and SmCo materials. REAlloys holds contracts with the Defense Logistics Agency and the US Department of Energy’s AMES National Laboratory. Hence, the alliance a powerful gateway for the Company to enter the U.S. supply chain.
Executive Chairman John Prineas called the deal “An attractive pathway into the fast-growing U.S. rare earths market.”
Araxá REE Project – A World-Class Resource
The Araxá Project is one of the largest and highest-grade carbonatite-hosting rare earth deposits in the world. Current estimates show 40.6Mt at 4.13% total rare earth oxides (TREO). It also contains significant niobium resources. Mineralisation starts from the surface, with more than 500 intercepts of high-grade niobium with grades of up to 8% Nb2O3 and 33% TERO.
Figure 4: Total Resources of Niobium and Rare Earths at Araxá
The region has a long mining history, established infrastructure, and skilled labour. St George has also secured support from the State of Minas Gerais. This includes expedited permitting under a cooperation agreement signed in 2024. The Company is part of Brazil’s MagBras Initiative. This program aims to create an integrated domestic supply chain for rare earths and magnets.
The Company continues to advance exploration at Araxá. Current drilling programs include auger, reverse circulation, and diamond drilling. The drilling aims to upgrade world-class MRE at Araxá and target previously undrilled areas. Recent results show new high-grade discoveries east of the existing modelled resource. Early assays have confirmed strong mineralisation continuity and suggested potential for a major upgrade.
Investors Outlook
St George Mining Limited is traded last at $0.070 (+11.111%), with a 52-week range of $0.015 – $0.071. The announcement of signing a Memorandum of Understanding (MoU) with U.S.-based REAlloys Inc. has had an impact on the stock’s performance today. The news drove a strong market response, with the share price climbing 11.1% on an impressive 47.8 million shares traded in a single session. This milestone marks a significant step in strengthening St George’s strategic growth trajectory. The Company has a market capitalisation of $184.06 million.
The strategic alliance with REAlloys provides a clear pathway to downstream opportunities, particularly in the U.S. supply chain, creating significant value growth potential. For investors, the combination of a rising price trend, tier-one assets, and strong global demand for rare earths underscores an attractive entry point into a company poised for further re-rating.
