Brazilian Rare Earths finds more high-grade growth beyond Monte Alto

Monte Alto’s grade underpins a $6 billion study case

Brazilian Rare Earths Limited (ASX:BRE) is using an unusually rich resource and a growing drilling inventory to push Monte Alto towards development, with the company reporting a 3.40 million tonne Mineral Resource grading 11.3% total rare earth oxides. The company says that grade is more than twice those reported for two established large-scale Western rare earth producers, although the comparison is not a like-for-like technical or economic assessment.

Its integrated Monte Alto and Camaçari scoping study forecasts an after-tax NPV8 of US$6.0 billion, a 90% internal rate of return, a 1.1-year payback and average annual operating free cash flow of US$1.2 billion under the cited Argus European and US price case. The study also forecasts first-five-year production of 6,351 tonnes a year of NdPr oxide, 274 tonnes of dysprosium-terbium products, 360 tonnes of gadolinium and 1,060 tonnes of yttrium.

Those numbers come with a substantial qualification. The study is preliminary, carries an estimated accuracy of approximately plus or minus 40%, and its production target is based on about 75% Indicated and 25% Inferred Mineral Resources. The company states that the Inferred component is too speculative to support Ore Reserve estimation, so the forecast production and financial outcomes may not be realised. Uranium revenue is also excluded from the study, despite forecast life-of-mine average production of 466 tonnes a year of U3O8.

New drilling could enlarge Monte Alto’s development base

More than 10,000 metres of drilling completed after the scoping study cut-off has extended mineralisation south and east, while opening a northern growth corridor. The reported results include 25.6 metres at 17.4% TREO from 174 metres, including 8 metres at 28.1% from 189 metres, and 9.4 metres at 21.8% from 161.7 metres, including 6.2 metres at 25.4%.

The results build on the company’s Monte Alto drilling extensions, which previously identified ultra-high-grade mineralisation beyond the existing resource boundaries. BRE is now planning more than 5,000 metres across the northern, southern and eastern fronts, with an updated Monte Alto Mineral Resource Estimate targeted for the fourth quarter of 2026. Any resulting mine-life extension or production increase remains dependent on resource conversion and further studies.

Sulista adds a second high-grade growth front

At Sulista South, diamond drilling has identified stacked mineralised seams over roughly 500 metres of strike, with grades reaching 13.3% TREO and true thickness of up to 18 metres. Mineralisation remains open along strike and at depth, while more than 4.5 kilometres of the southern exploration corridor remains untested.

The company’s Sulista South discovery was previously reported alongside a 430-metre extension to the Sulista East footprint. Step-out and infill drilling is continuing, with an updated Sulista resource estimate planned after the programme concludes. Sulista was not included in the Monte Alto and Camaçari scoping study, meaning any contribution would require further resource definition and technical work rather than simply being added to the existing forecast.

Camaçari pilot moves from equipment to concentrate

The Camaçari Partnership Pilot Plant has produced its first rare earth mineral concentrate, moving the project into bulk-scale metallurgical testwork intended to refine process design, equipment selection and cost estimates. The Stage II hydrometallurgical separation pilot is targeted for commissioning in the second quarter of 2027.

Partners including SENAI CIMATEC are contributing R$6.4 million, approximately A$1.7 million, towards Stage II, representing 59% of expected capex and opex. The company’s earlier first concentrate and Stage II funding helped establish the pilot pathway; the next stage is intended to test recovery and commercialisation routes for NdPr oxide, heavy rare earth products and uranium, scandium, niobium, titanium and tantalum.

Cash funds the next round of technical work

BRE finished the quarter with A$121.834 million in cash and cash equivalents, no borrowings and an estimated 8.5 quarters of funding based on the Appendix 5B calculation. Net operating cash outflow was A$14.293 million for the quarter, including A$13.088 million of exploration and evaluation expenditure, while the company made no payments for mine development or production activities.

That balance gives BRE room to fund drilling, pilot work and studies without reporting an immediate financing requirement. The more consequential test is whether the upcoming resource updates and metallurgical results can convert an attractive preliminary project model into a technically and commercially supportable development plan.