IONIC RARE EARTHS LIMITED — Investor Presentation 2021

Sep 20, 2021

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Makuutu Rare Earths Project Substantial potential for future long-life, low-cost, Scandium supply

21 September 2021

IONIC RARE EARTHS

Cautionary Statement

IMPORTANT NOTICE AND DISCLAIMER

This presentation should be considered in its entirety. If you do not understand the material contained in this presentation, you should consult your professional advisors. The sole purpose of this presentation is to provide shareholders with an update on current activities of the Company and the current state of exploration at the Makuutu Rare Earths Project in the Uganda.

Any statements which may be considered forward looking statements relate only to the date of this presentation document. Such forward looking statements involve known and unknown risks, uncertainties and other important factors beyond the Company’s control that could cause actual results, performance or achievements of the Company to be materially different from future results, performance, or achievements expressed or implied by such forward looking statements. As a result of these factors, the events described in the forward-looking statements in this document may not occur.

Notwithstanding the material in this presentation, shareholders should consider that any investment in the Company is highly speculative and should consult their professional advisers – whether scientific, business, financial or legal – before deciding whether to make any investment in the Company.

The Company may at its absolute discretion, but without being under any obligation to do so, update, amend or supplement this presentation or any other information to the recipient. No person has been authorised to give any information or make any representation other than contained in this document and if given or made, such information or representation must not be relied on as having been so authorised.

Competent Person Statement

Information in this report that relates to previously reported Exploration Targets and Exploration Results has been crossed-referenced in this report to the date that it was originally reported to ASX. Ionic Rare Earths Limited confirms that it is not aware of any new information or data that materially affects information included in the relevant market announcements.

The information in this report that relates to Mineral Resources for the Makuutu Rare Earths deposit was first released to the ASX on 3 March 2021 and is available to view on www.asx.com.au. Ionic Rare Earths Limited confirms that it is not aware of any new information or data that materially affects information included in the relevant market announcement, and that all material assumptions and technical parameters underpinning the estimates in the announcement continue to apply and have not materially changed.

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Makuutu is one of the largest global Scandium resources… and growing

3[RD] LARGEST GLOBAL SCANDIUM RESOURCE REPORTED

Key to the success of the scandium industry is a diverse and reliable supply chain

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While historically the scandium market has been dominated by Chinese supply, there are companies producing scandium or actively developing scandium supply Elk Creek (Niocorp)

Deposit Metals: Nb, Ti, Sc Scandium Resource: 15,500t Project Status: Financing

The Makuutu Rare Earths Project’s scandium endowment and time to market make it a key future global player in the scandium market

Sorel Tracy (Rio Tinto)

Deposit Metals: TiO2 waste Scandium Resource: unknown Project Status: Development Target Production: 3tpa Sc2O3

Crater Lake (Imperial Mining)

Scandium market

Deposit Metals: Sc, REEs Scandium Resource: to be defined Project Status: Advanced Exploration

expected to grow very quickly once stable supply is demonstrated

Kovdor (EuroChem)

Deposit Metals: FeO, Phosphate Scandium Resource: unknown Project Status: Producing Production: unknown

Makuutu

Deposit Metals: REE, Sc Scandium Resource: 9,450t + Project Status: Feasibility Study underway

SCONI (Australian Mines)

Deposit Metals: Ni, Co, Sc Scandium Resource: 1,400t Project Status: Financing

Nyngan (Scandium Intl)

Deposit Metals: Ni, Co, Sc Scandium Resource: 4,000t Project Status: Financing

Flemington (Australian Mines)

Deposit Metals: Ni, Co, Sc Scandium Resource: 1,100t Project Status: Scoping Study

Dalur (Rosatom)

Deposit Metals: U, Sc Scandium Resource: unknown Project Status: Producing Production: unknown

Bayan Obo (Inner Mongolia) Deposit Metals: REE Scandium Resource: unknown Project Status: Producing Production: ~5tpa Sc2O3

China (several suppliers) Deposit Metals: TiO2 waste Scandium Resource: unknown Project Status: Producing Production: ~10tpa Sc2O3

Taganito (SMM)

Deposit Metals: Ni, Co, Sc Scandium Resource: unknown Project Status: Producing Production: 7.5tpa Sc2O3

Ramu (CMC)

Deposit Metals: Ni, Co, Sc Scandium Resource: unknown Project Status: Producing

Sunrise (Clean TeQ)

Deposit Metals: Ni, Co, Sc Scandium Resource: 17,500t Project Status: Financing

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Scandium Market Overview

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AN EMERGING STRATEGIC METAL WITH LARGE POTENTIAL MARKETS IN THE GLOBAL TRANSPORT SECTOR AND AEROSPACE

• The Makuutu Rare Earths Project is positioning itself to become a key player in the Sc2O3 market via low cost production, planning to initially produce 20-25 tpa Sc2O3 initially and progressively ramp up production over 10 years to approx. 90-100 tpa Sc2O3

• While scandium is abundant in the earth’s crust, it is very uncommon to find it in economically recoverable concentrations

• Historically, it tended to be a minor or ignored potential by-product of mining, namely: rare earths, uranium, nickel-cobalt laterite, ilmenite (titanium dioxide)

• Almost all the current world’s production of scandium oxide (Sc2O3), or scandia, is re-processing titanium dioxide wastes or as a by-product from rare earth production

• Despite several large mineral endowments globally, Sc2O3 is predominantly produced by multiple small producers in China (approximately 15-20 tpa) with recent production capacity also being developed via processing of nickel laterite ores

• Most of this Sc2O3 is used in Solid Oxide Fuel Cells (SOFC), with Bloom Energy being the main consumer

• This small fragmented market has led to the belief that scandium is rare and expensive, which has hindered its growth, even with decades of technical development and use in aluminium alloys

3D printing using AP Works Scalmalloy® for the Airbus A320 https://www.airbus.com/newsroom/news/en/2016/03/Pioneering-bionic-3D-printing.html. Selective laser sintering using Scalmalloy® https://beamler.com/3d-printing-capabilities/processes/sls-selective-laser-sintering/.

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Scandium Market Overview

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AN EMERGING STRATEGIC METAL WITH LARGE POTENTIAL MARKETS IN THE GLOBAL TRANSPORT SECTOR AND AEROSPACE

• The light-weighting revolution occurring in the global transportation industry, combined with a growing global sector of mined supply, is unlocking a large new market for scandium

• Key applications identified in 3D printed rockets and components for space applications, such as the Terran-R from Relativity Space (right)

• Recently Rio Tinto and RUSAL have announced entry into Sc2O3 market, with a key focus being applications in 3D printing specialty components

• The Makuutu Rare Earths Project is positioning itself to become a key player in the Sc2O3 market via low cost, scalable production over a life exceeding 27 years

Mikoyan MiG-29

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• Al-Sc alloys were first used in the 1980s for structural purposes in Soviet aircraft and missiles.

The strength that Scandium alloys brought to weldable alloys, allowed the USSR to build aircraft (MIG-29) and utilise welded structures. This gave these planes tremendous weight, maneuverability and range advantages.

Russia has even stockpiled scandium for strategic reasons because several parts for advanced MiG jet fighters (pictured) are manufactured from this alloy.

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Applications with Aluminium in Light-weighting Transportation

THE NEED FOR LIGHT-WEIGHTING SOLUTIONS HAS DRAMATICALLY INCREASED THE ADOPTION OF ALUMINIUM ALLOYS IN TRANSPORTATION. STRICTER EFFICIENCY STANDARDS, THE ADVENT OF THE ELECTRIC VEHICLE AND THE EMERGENCE OF NEW SECTORS ARE ACCELERATING UPTAKE, GENERATING NEW OPPORTUNITIES FOR ALUMINIUM ALLOYS, LIKE AL-SC ALLOYS, TO STRENGTHEN ITS POSITION AS A KEY MATERIAL FOR THE FUTURE

AUTOMOTIVE

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AEROSPACE

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SPACE

MARINE

RAIL

Aluminium content in vehicles has been steadily increasing, driven by stricter efficiency and emissions requirements

Aluminium is displacing high-strength steel (HSS), a lower cost and heavier alternative, in several components

The electric vehicle (EV) revolution is dramatically accelerating aluminium’s market share through new parts (e.g. battery boxes) and the need to increase vehicle range. EVs have 35-50% more aluminium than internal combustion engine vehicles[1]

Aluminium is wellestablished in aerospace, with most airplanes constructed of aluminium alloys. While carbon fibre materials are lighter, they are more expensive, have a higher maintenance cost and require costly metals (such as titanium) to be used in concert. More advanced aluminium alloys can provide comparable low-cost alternative to composites

The next aerospace aluminium alloys will be strong and weldable, removing the need for rivets, providing enormous weight saving.

While historically niche subsector of aerospace, the commercial space industry represents a fast-growing sector where aluminium has a long, deep-rooted history

Rockets use a range of aluminium alloys in propellant tanks, providing a strong, lightweight material which can operate over large temperature ranges

Advanced aluminium alloys, combined with 3D printing, provide the space industry a unique opportunity to mass produce reusable rockets and satellites

Due to its high strength and high corrosion resistance, aluminium alloys are a growing material of choice for shipbuilding

‘Marine grade’ aluminium is 100 times less prone to corrosion than its steel counterpart[2]

‘Marine-grade’ aluminium alloys are both strong and weldable, which mean large sections of ships can be constructed with no joints or bolts, which reduce corrosion and the risk of water ingress

Like aerospace, aluminium has had a long history with rail, widely used in both freight and passenger cars

Aluminium provides ~30-35% weight reduction over steel and does not corrode, leading to a much longer service life

High-speed trains realise the greatest benefit from aluminium, which require low weight and highstrength to minimise friction loss

1 Aluminium Content in European Passenger Cars, Ducker Frontier presentation prepared for European Aluminium, Oct 2019, range depending on vehicle category 2 Aluminium in Transport, www.aluminiumleader.com/application/transport

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Applications with Aluminium in Light-weighting Transportation

A LITTLE SCANDIUM GOES A VERY LONG WAY

While the push to light-weighting provides a significant opportunity:

• Functional demands are driving aluminium companies to develop new alloys and processes to compete with HSS

• This increases the cost, which increases the substitution risk of composite materials

Scandium can solve both these issues for the aluminium industry:

• Adding trace amounts of scandium (0.05-0.1%) will significantly improve performance of aluminium alloys

• The addition of scandium avoids alloying and processing costs, keeping the material economically attractive compared to composites

This watershed moment in the scandium market is supported

by:

• A strong history and continued focus on research and commercial development by the alloy companies and transport sectors; and

• A reliable, multiple-source supply chain of low-cost scandium

Scandium has several key functional benefits across all alloy series which make’s it the most potent alloying element. As little as 0.05-0.1% of scandium in aluminium alloys can significantly improve its performance

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Increases the strength
across all alloy series
Stronger
reducing the weight of
components
Improves
Corrosion resistant
weldability and
alloys without loss in Corrosion
Weldable produces high-
strength - thinner Resistant
strength fatigue
material, lower
resistant welds
maintenance and Aluminium
longer service life +
Scandium
Maintains fatigue Maintains
performance for longer Fatigue Formable performance in
service life parts even Resistant forming and
through thermal cycling extrusion processes
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Research & Development to Commercialisation of Al-Sc Alloys

• There are decades of research and development on the use of aluminium-scandium alloys.

• While historically, scandium has been used in military aerospace, focus is shifting to the broader transport industry, including automotive and space.

• Scandium’s entry point into these sectors is likely to be in smaller applications (i.e., cargo doors, welding wire, etc.) and higher end products (luxury vehicles, commercial space), with continued consumption and growth (albeit modest) in Solid Oxide Fuel Cells (SOFC) applications

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ALUMINIUM-SCANDIUM POTENTIAL APPLICATIONS
Wire Feed
Die & Investment Cast
Launcher and cryogenic
Cylinders & engine parts
tanks for space
for vehicles Brackets
Weld
Welding wire for non-
3D Print weldable alloys Al-Sc
Casting weldable alloys for aircraft
Sand Cast & Weld
Pistons for Systems Systems
vehicles
Powder Feed
Bionic partitions
Highly complex
Amaero International is a
geometric parts
market leader in metal Wrought
additive manufacturing Systems
for use in 3D printing.
Amaero has partnered Sheet
Extrusions
with Rio Tinto to Radiators for vehicles
collaborate to develop the Car panels and doors Seat frames for vehicles
supply chain for Amaero’s Fuselage panels for Extruded parts for aircraft
high performance, High aircraft
Operating Temperature
Aluminium Alloy.
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ALUMINIUM-SCANDIUM COMMERCIAL DEVELOPMENTS

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Airbus has developed an aluminium-scandium powder (Scalmalloy[®] ) for use in 3D printing applications

Aleris has developed a scandium-containing alloy (5028) for use in aerospace applications.

Relativity Space is developing the world’s first 3D printed rockets for commercial orbital launch services.

In conjunction with Airbus and Sonaca, Aleris is qualifying the material for use on cargo doors on commercial aircraft

Airbus has combined Scalmalloy[®] with its inhouse design capability to produce a “bionic” partition for aircraft

Relativity has partnered with Clean TeQ to develop the scandium-containing alloys for 3D printing.

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Scandium Market Potential

SIGNIFICANT POTENTIAL FOR SCANDIUM MARET TO GROW RAPIDLY IN GLOBAL TRANSPORT SECTORS

While the current scandium (Sc) market is 15-20 tonnes per annum scandium oxide (Sc2O3), the global transportation industry has the potential to turn scandium into a billion-dollar market

Contestable Scandium Market

The adoption of scandium will be heavily dependent on its price-point. As the market grows, the scandium price will decrease as economies of scale for production can occur. This will allow aluminium-scandium to be used in an increasing number of applications.

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Scandium supply chain: 7Mtpa aluminium consumption in global transport: market grows, the scandium price will decrease as economies of scale for
production can occur. This will allow aluminium-scandium to be used in an
increasing number of applications.
While the initial price of scandium could be US$1,000/kg Sc2O32O3O33 at low tonnages,
this will likely drop to ~US$700/kg with increased volumes
Makuutu
Scandium Market Value Makuutu Scandium
•• Avg Sc content: 0.075%Required Scandium: 525tpa (800tpa 20-90+ tpa Sc2O2OO3
Automotive Aerospace Space, Marine, Rail Sc2O3)2O3)O3)3))
Other Scandium Makuutu Sc2O3 5-6Mtpa 1Mtpa <1Mtpa ••• Sc price range: US$700-1,000/kg ScMarket: US$560-800M p.a.Market: US$560-800M p.a. 2O3O33
Producers 20-90 tpa
Sc2O3 2.5-12% market share
710-780 tpa Future Markets / Applications:
Master Alloy 700ktpa aluminium consumption with scandium with a Military Vehicles & Wind Electrical Magnesium-
Producers 10% market penetration over the next 5-10 years Armour Turbines Cable scandium alloys
2% Scandium
Aluminium master alloy
26,000 tpa
0.05-0.1% Scandium-containing alloys ??? tpa
Aluminium Alloy
700,000 tpa
Other Alloying Producers
Elements
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While the initial price of scandium could be US$1,000/kg Sc2O32O3O33 at low tonnages, this will likely drop to ~US$700/kg with increased volumes

Makuutu Scandium

20-90+ tpa Sc2O2OO3

• (2.5-12% total market share)

• Sc2O3)2O3)O3)3))

• ••• 2O3O33 US$20-63M+ p.a. Revenue Sc price range: US$700-1,000/kg ScMarket: US$560-800M p.a.Market: US$560-800M p.a.

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Military Vehicles & Wind Electrical Magnesium-
Armour Turbines Cable scandium alloys
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IONICRE.COM.AU

Harnessing the wide appeal of the Makuutu Basket

MAKUUTU PROVIDES A UNIQUELY BALANCED BASKET WITH 73% CRITICAL AND HEAVY RARE EARTHS

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Makuutu is unique and

Infrastructure in close proximity to Makuutu

Scoping Study confirms robust economics for Base Case CREO and HREO production with potential to extend beyond 27 + years Life of Mine (LOM)

receiving global interest due to

high quality balanced (CREO + HREO) basket

• Existing highway and road access to site plus rail

Non-binding MOU signed with Chinalco subsidiary China Rare Earths Jiangsu to accelerate Makuutu mine development to production

Strategic importance of

• Nearby 132 kV power infrastructure with readily available low-cost hydropower

Makuutu (51% IonicRE ownership moves to 60% on completion of FS ~ Oct 2022)

• Cell phone communications available across site

IonicRE has pre-emptive right on remaining 40% of the Project

Discussions continue with other

groups looking to secure longterm CREO/HREO supply, and potential feed to standalone IonicRE Rare Earth Refinery

• Water available

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Potential for significant Exploration upside at Makuutu still to be realised

Already one of worlds largest Ionic Adsorption Clay (IAC) deposits

• Highly prospective licence EL00147 recently tested via RAB drilling with assays confirming clay hosted REE mineralisation present

Phase 4 drilling program

underway to increase Indicated and Measured resource base

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315 Mt Ionic Adsorption Clay (IAC) Mineral Resource Estimate with Upside

FURTHER IAC TARGETS IDENTIFIED AT MAKUUTU

279 drill holes (4,754 metres) completed between October 2019 and October 2020 defining JORC MRE[1 ] of 315 Mt @ 650 ppm Total Rare Earths Oxide (TREO), at a cut-off grade of 200 ppm TREO-CeO2

67 RAB drill holes (Phase 3) announced in July confirmed extension of mineralisation east to EL00147, between previous identified radiometric anomalies, and to northwest (application TN03573 pending)

Phase 4 infill drilling program now underway (7,800 m approved) to be completed by November to feed into next MRE update planned for Q1 2022

Objective to increase Indicated and Mineral Resource classifications to support Feasibility Study in 2022

Near term exploration extension from areas that haven’t yet converted (Areas C, E, Central Eastern Zone) so expecting total MRE will increase

Shallow, near surface IAC mineralisation , with clay layer averaging 5 to 12m thick under cover approximately 3m deep. Average hole depth ~17m

Longer term, numerous exploration targets identified for drilling in 2022

Scandium currently not included in cut-off grade determination

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Category	Estimation Domain	Tonnes (Mt)	TREO (ppm)	TREO no CeO2 (ppm)	LREO (ppm)	HREO (ppm)	CREO (ppm)	Sc2O3 (ppm)
Indicated Clay 66 820 570 590 230 300 30
Inferred Clay 248 610 410 450 160 210 30
Total Resource Clay 315 650 440 480 170 230 30

1 Makuutu Mineral Resource Estimate reported to ASX on 3 March 2021. 2 Phase 3 RAB results announced 15 July and 20 July 2021.

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Makuutu Rare Earth Project Highlights

STRATEGIC VALUE DERIVED BY THE UNIQUE CREO/HREO DOMINANT BASKET

Ionic Adsorption Clay (IAC) deposit mineralisation is highly desirable given it produces a balanced REO basket dominant in CREO & HREO

Globally one of the largest IAC deposits discovered outside of southern China and SE Asia & one of less than a handful of economic size and scale

High margin basket potential, approx. 73% of basket is CREO+HREO, magnet REOs make up 43% of basket

Scoping Study[1] completed in April 2021 defined a very robust base case with Highly attractive Scoping Study (11-year Base Case) economic parameters[1]

• Post-tax long term free cash flow US$766 million over 11 years

• EBITDA of US$1.28 billion

• Post-tax Net Present Value (8) of US$321 million

• Internal Rate of Return of 38%

• Pre-production CAPEX requirement of US$89 million

• Expansion CAPEX of $212 million funded by Project free cash flow

• Potential upside out to 27 years with inclusion of Inferred resource

315 Mt Mineral Resource Estimate[2] with significant exploration upside confirmed with mineralisation stretching across 37 km trend

Global Appeal – Strategic importance of Makuutu product basket seen as critical for governments to deliver carbon neutral policy objectives & major appeal to key defence applications

Scandium upside is significant with MRE containing ~9,450 tonne Sc2O3, potential annual production from 25 to ~100 tonnes per annum

MAKUUTU BASKET HIGH VALUE CREO / HREO PRODUCT

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Y2O3 La2O3
25.4% 13.5%
CeO2
13.5%
Lu2O3
0.2%
Yb2O3
1.3%
Tm2O3
0.3%
Er2O3
2.0% Pr6O11
5.5%
Ho2O3
0.7%
Dy2O3
3.7%
Tb4O7
0.6%
Gd2O3
4.4% Eu2O3
0.9% Sm2O3 Nd2O3
4.7%
23.2%
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1 Makuutu Rare Earths Project Scoping Study reported to ASX on 29 April 2021. 2 Makuutu Mineral Resource Estimate announced 3 March 2021.

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REE Hard Rock Mining/Processing vs IAC Mining/Processing

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Ionic Adsorption Clay (IAC) deposit mineralisation is highly desirable given it produces a balanced REO basket dominant in CREO & HREO with higher value and broader appeal Near surface IAC mineralisation translates to lower strip ratios with lower cost mining methods

IAC ores require much lower CAPEX intensity to produce refined REOs

IACs produce value added Mixed Rare Earth Carbonate product from IAC deposits, higher grade and basket value IAC product achieves nearly double the payability

IACs experience none of the radionuclide issues the plague hard rock LREO Projects

IAC separation and refining much lower CAPEX requirement

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Tier-One In-Country Infrastructure already there – supports low CAPEX development

EXCELLENT LOCAL INFRASTRUCTURE SUPPORTS LOW CAPEX DEVELOPMENT

LOGISTICS

Approximately 10 km from Highway 109, connecting Makuutu to both capital city Kampala and Port of Mombasa, Kenya

Approximately 20 km from rail line connecting to Port of Mombasa

POWER

Large hydroelectric generation capacity (+810MW) within 65 km of Makuutu Project area will deliver very low-cost (US$0.05/kWh), plus further capacity being developed

Existing electrical grid infrastructure immediately adjacent to site to provide stable power

WATER

Plentiful fresh water within and near project area (water harvesting)

WORKFORCE

No camp required – low-cost professional local workforce available

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Ionic Rare Earths Limited

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