Key facts
- REalloys said it signed a nonbinding term sheet with the US Army for a proposed 75-year lease at Tooele Army Depot in Utah.
- The proposed terms are an initial 50-year lease with a possible 25-year extension, with the government retaining land ownership.
- The Army would receive a right of first offer on production but is not obligated to purchase any material, the company said.
- REalloys reported $122.4 million in cash at the end of June after an approximately $100 million private placement.
- The company said its Saskatchewan expansion targets about 525 tonnes a year of NdPr metal, 30 tonnes of dysprosium oxide and 15 tonnes of terbium oxide.
REalloys (NASDAQ: ALOY) said it signed a nonbinding term sheet with the US Army proposing a potential 75-year operating lease on approximately 200 acres at Tooele Army Depot in Utah, where the company would build and operate a facility processing dysprosium and terbium. The proposed terms set an initial 50-year lease with a possible 25-year extension, government ownership of the land and a privately financed industrial operation. The final lease still requires financing and regulatory approvals, the company said.
Under the proposal, the Army would receive a right of first offer on production, giving it an opportunity to secure material for American weapons manufacturers before it is offered to other buyers, though it is not obligated to purchase any. The Army would also receive participation rent once commercial operations begin, with the methodology to be negotiated in the definitive lease. The relationship began in June, when the Army selected REalloys for exclusive negotiations.
Dysprosium and terbium are used in high-performance magnets for fighter aircraft, missile systems and advanced electric motors, and China controls almost all global processing of both, according to the report. Beijing introduced export restrictions on seven categories of medium and heavy rare earths in April 2025. Beginning January 1, 2027, expanded federal sourcing restrictions will apply to covered rare earth magnets and their supply chains.
Retired four-star General Jack Keane, who serves on REalloys' board, said in the company's announcement: "For too long, the United States has depended on adversaries and others for the materials inside its most advanced defense technology." The Army's Dr. Jeff Waksman described rare earth processing as a national security vulnerability and pointed to China's near-total control of dysprosium and terbium, according to the report.
REalloys is developing rare earth materials in Euclid, Ohio, and has partnered with Canada's Saskatchewan Research Council. Under that arrangement it secured rights to approximately 80% of SRC's expanded output, with the upgraded facility targeting annual production capacity of roughly 525 tonnes of NdPr metal, 30 tonnes of dysprosium oxide and 15 tonnes of terbium oxide. The company said it is developing what it says will become the largest heavy rare earth metallization facility outside China, with commissioning targeted for the first quarter of 2028.