Arafura Resources (ASX:ARU) has signed a Memorandum of Understanding (MOU) with South Korea’s OCI Company to establish a joint venture for a rare earth separation plant in South Korea.
As quoted in the press release:
Korea Exchange-listed OCI is headquartered in Seoul, South Korea, with large domestic and international operations in the USA, China and Europe. It has an extensive product portfolio for the manufacture and sale of inorganic, petro and coal chemicals, fine chemicals and renewable energy. OCI’s core business is chemical manufacturing but has pursued an innovation strategy to expand its operations to become a leading global green energy and chemical company.
As highlighted in the Company’s Quarterly Activities Report (ASX: ARU 27/07/15) Arafura initially entered into a Letter of Intent (“LOI”) with OCI in June 2015. In the subsequent months OCI and Arafura have collaborated to examine the strategic benefits for both parties through the establishment of a JV RE Separation Plant. This process has identified considerable opportunities for both parties leading to the completion of a more formal MOU. Whilst non-binding, both companies acknowledge the significant synergies in the approach outlined in the MOU.
Arafura managing director Gavin Lockyer said:
We are extremely pleased to have OCI as a potential joint venture partner in the Nolans Rare Earth Separation Plant. OCI’s expertise in chemical manufacturing coupled with the location of an existing plant in a chemical precinct, plus its inclusion in the Saemangeum Free Economic Zone, de-risks a key aspect of the Nolans development.
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