In a statement to the media, Avalon clarified that under the terms of the agreement, Cheetah will pay C $ 5 million to acquire ownership of the subsurface mineral resource at Nechalacho, 150 meters above sea level.
In parallel, Avalon will retain ownership of the deeper resources in the Basal Zone that were the subject of its 2013 feasibility study.
Cheetah plans to focus on the T-zone and Tardiff-zones of the project, where company experts have determined that near-surface resources enriched with neodymium-praseodymium minerals of the bastnesite group are well suited for low-cost pilot development of rare earth elements using ore grading technology.
Neodymium and Praseodymium are used for environmentally friendly technologies used especially in the production of electric vehicles.
“We are delighted to have reached an agreement with Cheetah on this innovative collaboration model,” said Don Boubar, President and CEO of Avalon, in a statement to media. “At a time when China controls at least 80 percent of the world's supply of rare earths and threatens to restrict exports, ... new internal supply chains need to be created to serve the North American market to reduce dependence on Chinese supplies.
