A billion-dollar critical minerals and rare earths “mine to metals” project in New South Wales has secured a $5 million grant for further development studies ahead of front-end engineering design work.
Resources minister Madeleine King announced the funding for Australian Strategic Materials’s project, located in Dubbo, through the International Partnerships in Critical Minerals Program on Tuesday.
Non-binding debt financing commitments collectively worth $1.2 billion to support the construction phase of the project has also been made by the United States Export-import Bank ($923 million) and Export Finance Australia ($200 million).
The Dubbo Project aims to produce critical minerals like zirconium, niobium and hafnium as well as several rare earth elements.
The matched grant will support a rare earths options assessment and pilot program to “identify potential lower capital and shorter implementation pathways to rare earth production”, according to the company.
It will include engineering sampling, metallurgical testing and pilot testing at Australian Strategic Materials’ pilot facility located at the Australian Nuclear Science and Technology Organisation in NSW.
The pilot program will be delivered with engineering multinationals DRA Global and Stantec, in addition to Victoria-based Mining One and Queensland-based Core Metallurgy.
ASM previously received a $6.5 million grant for development studies and front-end engineering design (FEED) work awarded to Australian Strategic Materials (ASM) in mid-2023 under the Critical Minerals Development Program.
In March, ASM awarded US-based Bechtel a contract for FEED services work.
This means the Dubbo project is eligible for funding under the “US EXIM’s Engineering Multiplier Program (EMP) and received another letter of interest for conditional debt funding of up to US$32 million to cover >80% of the FEED contract costs”, according to ASM’s annual report.
In April, Export Development Canada also made a non-binding commitment to the construction phase worth $400 million but this is not mentioned in ASM’s latest statement to the ASX.
Final investment decision on the Dubbo project is targeted for the first half of 2026 and targeting first production in 2028.
Ms King said “government support to refine rare earths is important for our sovereign capabilities and will help our trading partners meet their economic, national security and emission reduction commitments”.
The minister also confirmed that the Dubbo project would receive further support through the incoming critical minerals production tax credit, due to come online in mid-2027, even though the list of eligible critical minerals products is yet to be finalised.
The tax credit, part of the Future Made in Australia (FMiA) plan, is opposed by the federal Opposition, with leader Peter Dutton describing it as “billions for billionaires”.
Ms King however, accuses Mr Dutton of “standing in the way of creating jobs and prosperity in regional areas like Dubbo”.
“ASM has received interest from no less than the US government, but Mr Dutton is refusing further support for this project and others like it because he is blocking the Critical Minerals Production Tax Incentive,” Minister King said.
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