One of Liberum’s top rice COP26 stock picks18 Oct 2021 08:21
“The company is building a rare earth processing plant in the Humber estuary (UK), which will become the first major separation facility to be established in over a decade. By successfully bidding together with Associated British Ports and others to turn the Humber Estuary industrial sites into the Humber Freeport, materials can be shipped into the Freeport, processed there and then shipped out without incurring import or export taxes, making it significantly cheaper than other facilities around the world.
In essence, Pensana will become the prime supplier for rare earth metals all over Europe and the UK, providing the continent with much-needed independence from Chinese supply. The processing facility under development is expected to produce 12,500 tonnes of rare earth metal oxides per year, 4,500 tonnes (about 5% of global supply in 2025) of which are magnet metals.
What makes Pensana particularly interesting as an investment is not only its strategic position in the decarbonisation value chain and its location as Europe’s preferred supplier, but its cheap market valuation so far. Another factor that makes Pensana attractive as a decarbonisation play is that while its processing plant can use raw materials from anywhere, the company is developing the Longonjo mine in Angola.
This rare-earth metals mine is developed to the highest ethical and environmental standards, using hydropower to power the mine and building tailings storage facilities aligned with the recommendations of the Church of England Pensions Board and International Council on Mining & Metals guidelines. Once operational, Pensana will become the first company to supply rare earth metals along a fully sustainable supply chain.”
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