FISHERS, IN - American Resources (NASDAQ:AREC) Corporation (NASDAQ:AREC) has announced through its subsidiary ReElement Technologies Corporation, a significant advancement in the production of rare earth elements from mine waste. The subsidiary has demonstrated a proprietary process that allows for the extraction of mixed rare earth oxides (MREO) from carbon waste streams, with concentrations consistently above 500 parts per million. According to InvestingPro data, the company, currently valued at $95.23 million, faces significant operational challenges with an EBITDA of -$23.16 million in the last twelve months.
The company's internal surveyors have identified over 128 million tons of previously extracted waste material available for processing, with a focus on an estimated 8 million tons from their West Virginia property. This development could represent a breakthrough in the industry, providing a sustainable and cost-effective source of rare earth elements, crucial for various technologies including electric vehicles and electronics. However, InvestingPro analysis reveals concerning financial metrics, including a current ratio of 0.23 and substantial debt burden of $229.89 million, which may impact the company's ability to fully capitalize on this opportunity.
Mark Jensen, CEO of American Resources, highlighted the economic viability of using byproduct economics and coal waste material for rare earth oxide production. He emphasized the potential benefits for the battery and defense sectors due to the high concentrations of aluminum oxide and silicon dioxide in the waste material.
ReElement's refining platform aims to offer a robust supply chain for critical minerals independent of China, which currently refines over 90% of the world's rare earth elements. The company's refining process, which includes Ligand Assisted Displacement (LAD) Chromatography, is touted as a cost-effective and environmentally safe alternative to conventional methods.
The development comes amidst escalating trade tensions between China and the United States, particularly concerning critical minerals. China's recent ban on the export of specific critical minerals and the importance of dysprosium in advanced semiconductor production underscore the strategic significance of ReElement's domestic refining capabilities.
ReElement is expanding its operations, which include a partnership with American Infrastructure Corporation, to refine concentrated rare earth materials into ultra-pure products. The subsidiary also provided updates on its Marion, Indiana super-site, poised to become the largest combined rare earth element and lithium refining facility in the United States.
This press release statement indicates that ReElement Technologies, through its innovative refining process, is well-positioned to address supply chain and national security challenges by providing a domestic source of rare earth and critical minerals. While the company's strategic positioning appears promising, InvestingPro data shows significant revenue challenges with a 98.13% decline in the last twelve months. Subscribers to InvestingPro can access 12 additional key insights and a comprehensive Pro Research Report, offering detailed analysis of AREC's financial health and growth prospects.
In other recent news, American Resources Corporation detailed significant strategic developments and progress toward multiple public listings during its Third Quarter 2024 Earnings Call. The company highlighted the upcoming spin-offs of ReElement Technologies and American Infrastructure, with ReElement set for a public listing shortly after December 2024. Despite market challenges, American Resources expressed confidence in its growth potential.
The company also discussed its transformation, focusing on environmental remediation, rare earth element production, and metallurgical carbon market profitability. American Infrastructure is transitioning to a royalty-based model, while American Metals partners with LOHUM Cleantech for battery recycling. The company is working on a merger with AI Transportation Acquisition Corp. and plans to spin off American Metals.
ReElement Technologies is developing a new facility in Marion, Indiana, targeting significant revenue growth by 2025 and preparing for a public listing. Despite challenges in the current market environment and delays in public listings for Novusterra and American Carbon due to auditing challenges, the company remains optimistic about its potential profitability. These are just a few of the recent developments for American Resources Corporation.
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