LONDON (Reuters) - Rainbow Rare Earths
The project's minerals are weighted towards magnetic rare earths, including neodymium and praseodymium, which are expected to used become increasingly sought after for use in generators, wind turbines and electric vehicles as supply from top producer China dwindles.
Rainbow's shares were placed at 10 pence per share. They opened at 10.75 pence, hit a session high of 12.84 pence and were trading at 11.50 pence by 1030 GMT.
The Gakara project has a 10-year distribution and offtake agreement with a division of Thyssenkrupp to take 100 percent of production up to 5,000 tonnes and the option to take anything above that.
Rainbow CEO Martin Eales said that Gakara is distinguished by its quality.
"Our project boasts an in-situ grade in the range of 47-67 percent TREO (total rare earth oxide), making it one of the highest-grade rare earth element (REE) projects globally," he said.
"With recent shifts in the rare earths market, driven by the increasing demand for powerful magnets used for electric vehicles, motors and wind turbines, we believe that now is an optimal time for Rainbow to produce REE concentrate."
There are very few pure rare earths players listed in London -- Mkango Resources
Its industrial strategy offers support for a low-emission vehicles industry, which would require rare earths.
Australian-listed Peak Resources (>> Peak Resources Ltd.), which is developing rare earths in Tanzania, has been granted permission for a rare earths refinery in northeastern England.
(Reporting by Barbara Lewis; Additional reporting by Zandi Shabalala; Editing by David Goodman)