Ucore Rare Metals Inc. has finalized a firm fixed-price agreement with the U.S. Department of Defense (DOD), significantly expanding its funding for rare earth element (REE) processing infrastructure in the United States. The agreement, administered through the U.S. Army Contracting Command – Orlando, boosts the company’s existing US$4 million other transaction agreement to a total of US$22.4 million, with an added US$18.4 million earmarked for construction of a commercial-scale RapidSX machine and related infrastructure in Alexandria, Louisiana.

The Canadian-based firm, headquartered in Halifax, Nova Scotia, views this development as pivotal not only for its own growth but also for broader national security interests.

“This U.S. DOD Louisiana SMC funding agreement is a critical step for Ucore’s commercial advancements, but more importantly, for the progression of a Western rare earth supply chain and North American critical metals security, which cannot exist without competitive critical metals processing on the world stage,” the company stated in a press release.

Ucore is currently advancing its proprietary rare earth separation platform, RapidSX, at a demonstration facility in Kingston, Ontario. The process is designed to provide a cost-effective and environmentally sound alternative to conventional solvent extraction techniques, traditionally dominated by Chinese producers.

The new funding will support phase two of Ucore’s commercialization plan by transitioning RapidSX from pilot-scale testing to full commercial production. The expansion involves installing a full-scale RapidSX separation unit capable of processing several key rare earth elements—praseodymium (Pr), neodymium (Nd), samarium (Sm), gadolinium (Gd), terbium (Tb), and dysprosium (Dy)—which are all subject to export controls by the People’s Republic of China.

The initiative is a continuation of Ucore’s Rare Earth Element Separation Technology Capability Prototype Project and aligns with its technology transfer and scale-up plan. The company aims to deploy the knowledge and equipment developed in Ontario to its forthcoming Louisiana Strategic Metals Complex (SMC), where construction and initial production capacity will be based on modular and scalable design.

Key objectives of this new phase include:

• Building and operating full-scale RapidSX technology modules at the Kingston demonstration site.
• Executing a system engineering approach to guide knowledge transfer and equipment deployment from the Canadian site to the U.S.-based SMC.
• Establishing production capabilities at the Louisiana facility with the ability to process hundreds of tonnes of both heavy and light rare earth oxides.

With commissioning expected by the fourth quarter of 2025, Ucore anticipates launching commercial production in early 2026. The goal is to eventually scale up the Alexandria facility to 2,000 tonnes per year of total rare earth oxide (TREO) production in phase one.

“This funding positions Ucore as a key contributor to reshoring critical rare earth processing capacity in North America, at a time when global demand for magnet-focused rare earths is escalating,” said company leadership in supplemental remarks.

Despite the strategic milestone, Ucore’s stock dipped slightly on the news, falling 1.28% to $1.54. The stock has traded within a 52-week range of $2.26 to $0.50.

Ucore’s long-term vision is to become a vertically integrated REE supplier for North American technology and defense sectors, providing domestic alternatives to foreign-dominated supply chains. The successful commercialization of RapidSX is central to that strategy.

Originally reported by Resource World.