How Brazilian Rare Earths’ 568 Mt Amargosa Resource Could Reshape Bauxite Supply
Brazilian Rare Earths Limited (ASX – BRE) has announced a maiden JORC-compliant Mineral Resource Estimate for its Amargosa Bauxite-Gallium Project in Bahia, Brazil, revealing a substantial deposit with high-quality bauxite and significant gallium content.
- Maiden Mineral Resource Estimate totals 568 million tonnes at 29.8% Total Available Alumina
- Includes 98 million tonnes of direct-ship bauxite at 41.9% TAA with low reactive silica
- 27,098,000 kg of contained gallium, a strategic metal for semiconductors and defense
- Project benefits from strong infrastructure and logistics, including MoU with Port of Enseada
- Scoping study and further metallurgical test work targeted by end-2025
A Landmark Resource for Amargosa
Brazilian Rare Earths Limited (ASX – BRE) has delivered a significant milestone with the release of a maiden JORC-compliant Mineral Resource Estimate (MRE) for its Amargosa Bauxite-Gallium Project, located in the mining-friendly state of Bahia, Brazil. The resource totals an impressive 568 million tonnes of bauxite grading 29.8% Total Available Alumina (TAA), including a high-grade direct-ship component of 98 million tonnes at 41.9% TAA. Complementing this is a substantial gallium endowment of over 27 million kilograms, positioning Amargosa as a potential key player in strategic metal supply chains.
Quality and Strategic Advantage
The bauxite resource stands out for its benchmark-grade quality, with direct-ship bauxite specifications aligning closely with the Guinean metallurgical bauxite standard, a globally recognized benchmark. Notably, the deposit features a low reactive silica index (RSI), averaging 2.5% in the direct-ship category, which is advantageous for alumina refining by reducing caustic soda consumption and improving alumina recovery. This quality aspect is increasingly critical as global refineries tighten feedstock specifications amid environmental and cost pressures.
Gallium, a metal essential for semiconductors, high-performance magnets, and defense technologies, is a strategic co-product at Amargosa. With China dominating global gallium supply, BRE’s resource offers an alternative source from a stable jurisdiction, aligning with global efforts to diversify supply chains. The presence of 27 million kilograms of contained gallium could enhance the project's economics pending further metallurgical and market studies.
Infrastructure and Logistics – A Competitive Edge
Amargosa benefits from excellent infrastructure and logistics. The project is situated approximately 160 kilometers from the Port of Enseada, with a recently signed Memorandum of Understanding to facilitate mine-to-port export logistics. The region boasts paved multi-lane highways, access to renewable hydropower, and proximity to the nearly completed FIOL heavy-haul railway, which will connect to the planned Porto Sul deep-water terminal. These factors support a capital-efficient direct-ship operation with scalability options through beneficiation and rail export pathways.
Development Pathway and Next Steps
BRE plans to advance the Amargosa project with a scoping study targeted for completion by the end of 2025. This study will evaluate development scenarios, including direct-ship operations and processed bauxite production. Concurrently, metallurgical test work aims to assess potential upgrades in product grades, while exploration drilling will focus on resource growth and optimization. The company is also exploring strategic options such as joint ventures, spin-outs, or IPOs to unlock shareholder value and focus on its rare earth elements portfolio.
Context in the Global Market
The timing of this resource announcement is notable against a backdrop of declining high-grade bauxite supply globally and geopolitical risks affecting dominant suppliers like Guinea. Amargosa’s location in Brazil, a stable and supportive mining jurisdiction, offers an attractive alternative for alumina refiners seeking reliable, high-quality feedstock. Additionally, the gallium resource taps into growing demand driven by semiconductor and defense sectors, where supply diversification is a strategic priority.
Bottom Line?
Amargosa’s maiden resource sets the stage for Brazilian Rare Earths to become a significant supplier of premium bauxite and strategic gallium, with upcoming studies poised to define its commercial trajectory.
Questions in the middle?
- How will metallurgical test results influence the economic viability of gallium recovery at Amargosa?
- What are the timelines and terms expected for formalizing export logistics agreements with the Port of Enseada?
- How might BRE’s strategic options, including potential spin-outs or joint ventures, impact shareholder value and project focus?