NioCorp nears Elk Creek full $1.1B financing

NioCorp Developments (Nasdaq: NB) says it has signed up commodity trader Traxys to buy and market the remaining planned output from Elk Creek, moving closer to full financing for the $1.1-billion capex critical minerals project in Nebraska. 

Colorado-based NioCorp already had contracts in place for three-quarters of its planned ferroniobium production — one quarter from Traxys two quarters from ThyssenKrupp — and 12% of scandium oxide production, entirely from Traxys, over the first decade.

The new agreement Thursday would cover the remaining quarter of the ferroniobium production, on a take-or-pay basis, and the remaining scandium, on a best-efforts basis. It would also include all other planned products such as titanium dioxide or rare earth elements.

“We believe that this initiative moves NioCorp closer to securing full project financing for the Elk Creek project,” Mark Smith, CEO and executive chairman of NioCorp, said in a release. “This would address one of the key remaining due diligence items in the Export-Import Bank of the United States review of our proposed debt financing package.”

Financing 

Over the past two years, NioCorp has been working with the U.S. Export-Import Bank to secure up to $800 million in debt financing, arguing the Nebraska project could help reduce U.S. reliance on foreign suppliers, particularly China, for materials seen as strategically important.

Elk Creek is central to U.S. efforts to build a domestic critical minerals supply chain, with planned output of niobium, scandium, titanium and possible rare earth by-products used in high-performance magnets for electric vehicles, wind turbines and defence systems.

According to NioCorp, the site hosts North America’s highest-grade niobium resource and one of the world’s largest scandium resources. It also has America’s second-largest indicated rare earth resource.

The arrangement agreed Thursday also may see Traxys invest $30 million in NioCorp stock, which would be about 5% at current prices. 

Shares of NioCorp traded 0.7% higher at $4.92 apiece in New York on Thursday afternoon, valuing the company at $702 million.  

Marketing

In addition, Traxys will serve as the marketing intermediary for other product sales, including certain third-party commercial agreements identified by NioCorp.

The arrangement, said NioCorp, would make Traxys the “exclusive offtake and marketing partner” for all planned production from the Elk Creek project during the first 10 years of operation, with the exception of the ferroniobium allocated to ThyssenKrupp.

“The Elk Creek project represents a key future source of critical minerals for US and allied markets,” said Mark Kristoff, CEO of Traxys, noting that the U.S. currently has no primary domestic production of niobium or scandium and has limited production of the magnetic rare earths neodymium and praseodymium.