By Marta Nogueira
RIO DE JANEIRO, 3 Dec (Reuters) – The mining company Terra Brasil Minerals plans to conclude in the coming months a process of attracting investors for a new phase of the company, which foresees investments of US$1 billion in rare earth and fertilizer projects in the Alto Paranaíba region, between Patos de Minas and Presidente Olegário (MG).
Eduardo Duarte, president of the company, told Reuters that around 18 companies — most from other countries, such as the United States, United Kingdom, Australia and China — have already accessed the ‘data room’ for the sale process, which began around two years ago with the hiring of Genial Investimentos to format the transaction.
Recently, the project has gained new momentum, according to Duarte, with Brazil’s large rare earth reserves emerging as a key player on the global geopolitical chessboard, as the United States and European Union countries seek new sources of these critical raw materials in order to reduce dependence on China, the largest producer.
‘Brazil is at a unique moment, it must be a protagonist… ‘We were ready at the exact moment’, highlighted Duarte, who is part of the family of the mining company’s controlling group.
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According to the executive, in addition to companies in the sector, representatives of the United States government even sought information about the company from Genial Investimentos.
Despite having the second largest global reserve of rare earths, the country produced only 20 tons in 2024, a minimal fraction of the global supply of 390 thousand tons, according to information from the Brazilian Geological Survey.
Created in 2013, Terra Brasil is a privately held junior mining company that has already invested more than R$200 million. Own resources were used for feasibility research and development of technologies for processing minerals.
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Of the total investment foreseen in the Terra Brasil project, US$500 million should be allocated to the development of rare earths, minerals with diverse applications, ranging from cell phone screens to missile systems. And the rest goes to fertilizers, a product with great demand in the Brazilian market, which imports a large part of its needs.
The executive’s expectation is that a joint venture being formed by different investors will make an offer to enter the venture, either as a partner or even a complete acquisition.
‘The most likely thing is that it will be this: a rare earth industry, another fertilizer industry, and some fund that will make some type of proposal’, said the executive, in a video conference interview.
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Terra Brasil currently has a reserve in the certification phase of more than 3 billion tons of kamafugite volcanic rock, which contains phosphate, potassium and several rare earth elements and can produce for around 50 years, scalable, according to the executive.
‘We are ready to negotiate any type of model… of staying in the operation, of leaving the operation, of being small partners…’, said Duarte.
Of the total contributions foreseen in the project, a part should be invested in manufacturing facilities for the separation and processing of minerals, in addition to mining, according to the executive.
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Halfway there, rare earth
Duarte highlighted that rare earths became the ‘icing on the cake’ of the project, which initially focused on fertilizers.
‘Halfway along the way, we found a rare earth stone, to paraphrase our Drummond, a beautiful stone, a beautiful ore, then we changed’, he said, citing Minas Gerais poet Carlos Drummond de Andrade and the decision to also invest in other minerals, which have gained relevance on the global stage.
The mining company is currently working to obtain a Canadian certification called NI 43-101, which regulates the dissemination of technical and scientific information about mineral projects, which could be published in January.
The measure is necessary for companies that want to go public or raise investments on Canadian stock exchanges, but it is also used as an international reference to provide investors with security about mineral reserves and resources.
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Bottlenecks
Despite some recent initiatives by the Brazilian government to stimulate the sector, obtaining financing for the rare earths industry, still nascent in Brazil, is one of the bottlenecks for the development of projects in the country, according to members of the sector gathered at a congress in Salvador, in October.
Raul Jungmann, president of the Brazilian Mining Institute (Ibram), considered that Brazil’s vast reserves of these strategic minerals represent ‘a passport to the future’. But he admitted that the difficulty of finding guarantees for project financing has delayed this journey.
‘The time when resources are most needed is precisely when there is least supply. Only when the project starts to generate cash do the various sources of financing appear’, added Ricardo Grossi, president of Mineração Serra Verde, during the congress.
A report by the newspaper O Estado de S.Paulo, published in November, indicated that rare earths producer Mineração Serra Verde was looking for a minority partner to capitalize, but the company declined to comment on the matter when contacted by Reuters.
Rafael Moreno, CEO of Viridis Mining with assets in Poços de Caldas (MG), and Ramon Costa, president of Aclara, with a project in Goiás, believe that a possible agreement with the USA — in a context of tariff negotiation — could unlock financing for the sector.
The US chargé d’affaires in Brazil, Gabriel Escobar, had meetings in October with mining companies about rare earths during the Exposibram congress, but no announcement was made.
Moreno mentioned the problem of the lack of guarantees for financing in the sector, while Costa recalled that there is already some US investment in Brazil: Aclara received US$5 million from the development financing agency DFC.
(Reporting by Marta Nogueira, with additional reporting by Fábio Teixeira)
