Could Delays or Regulatory Risks Still Threaten Araxá Despite Government Support?
St George Mining has won preferential tax treatment from the Minas Gerais government, cutting development costs for its flagship Araxá Project in Brazil. This support bolsters the company’s ambitions to establish a world-class niobium and rare earths operation.
- Minas Gerais grants tax exemptions on equipment and materials for Araxá Project
- Government collaboration accelerates regulatory approvals and feasibility studies
- Joint venture with CEFET to build a pilot plant and technological centre in Araxá
- Araxá hosts a globally significant niobium and rare earths mineral resource
- Strong local and state government backing enhances project viability
Government Support Cuts Costs for Araxá Development
St George Mining Limited (ASX, SGQ) has secured a preferential goods tax regime from the State of Minas Gerais, Brazil, marking a significant milestone for its Araxá Project. The agreement exempts the company from paying up to 18% state goods tax on equipment and materials acquired for both pilot and full-scale industrial plant development. Signed by Governor Romeu Zema and key state agencies, this tax relief is expected to materially reduce upfront capital costs and improve the project’s economic outlook.
Strategic Collaboration and Local Partnerships
This fiscal support builds on a 2024 Memorandum of Understanding between St George and Minas Gerais authorities, aimed at fast-tracking approvals and fostering domestic supply chains for critical minerals. The company has also partnered with CEFET, a government-funded technological institute, to establish a pilot plant and a technological centre in Araxá. This facility will enable mineral processing and hydrometallurgical refinement, producing samples of ferroniobium and rare earth products, and supporting ongoing research and development.
A World-Class Resource in a Mining Hub
The Araxá Project, acquired by St George in early 2025, is situated adjacent to CBMM’s renowned niobium operations and benefits from established infrastructure and a skilled workforce. The project boasts a globally significant mineral resource, with over 41 million tonnes of niobium-bearing ore at 0.68% Nb₂O₅ and a rare earths resource averaging 4.13% total rare earth oxides. These grades underpin the company’s confidence in developing a robust mining operation that could supply critical minerals essential for clean energy technologies.
Government Endorsement and Community Engagement
Governor Romeu Zema, a native of Araxá, has publicly endorsed the project’s potential to position Minas Gerais as a leader in Brazil’s critical minerals sector. The December 2025 Critical Minerals Forum hosted by St George attracted over 200 delegates, reflecting strong community, government, and stakeholder engagement. This local support, combined with the company’s experienced in-country team, enhances the project’s prospects for timely development and production.
Looking Ahead
With tax incentives in place and strategic partnerships established, St George is well-positioned to advance the Araxá Project through feasibility studies and regulatory approvals. The pilot plant at CEFET will serve as a critical step in refining processing techniques and demonstrating product quality. As global demand for niobium and rare earths grows, particularly for clean energy applications, Araxá’s development could become a significant contributor to both Brazil’s mining sector and international supply chains.
Bottom Line?
St George’s strengthened government ties and cost advantages set the stage for Araxá to become a critical minerals powerhouse.
Questions in the middle?
- What is the timeline for completion and commissioning of the pilot plant at CEFET?
- How will the tax exemptions quantitatively impact the overall project capital expenditure?
- What are the next regulatory hurdles and expected timelines for Araxá’s full-scale development?
