Shares in Australia-listed Sunrise Energy Metals Ltd (SRL:ASX) jumped by 29% at opening on Monday after the U.S. Department of War announced a conditional commitment for a US$400-million loan for the company to build out its scandium operations.
The Department of War’s Office of Strategic Capital (OSC) conditionally committed up to US$400 million under a proposed 25-year debt facility for development of the Syerston Scandium Project, the U.S. Administration said on Friday.
Sunrise Energy Metals owns the Syerston Scandium Project in New South Wales, Australia. Scandium is a metal that is found throughout the Earth’s crust in low concentrations but is valuable in defense and aerospace applications. Currently, scandium is harvested through by-products of other industrial or resource extraction processes.
“No primary mine-source scandium supply exists globally, and foreign competitors dominate the supply side, accounting for approximately 80% of global mining production and nearly 100% of scandium processing,” said the U.S. Administration, which looks to reduce U.S. reliance on China for critical metals and rare earth elements.
Thanks to the U.S. funding and private capital, Sunrise plans to develop a full scandium value chain, beginning with its primary mining operations at its Syerston project, which boasts a high-grade scandium deposit.
The Australian company also plans to build metallization and additive layer manufacturing capabilities to ensure Western alignment from mine to finished product.
The financing will provide the Department with a right of first offer on Sunrise’s output, and the scandium produced by Sunrise would support the demand of U.S. companies, including defense industrial base companies, the Administration said.
“This is a landmark moment for Sunrise and Australia’s mining industry, and the financing aligns with the goals of the U.S.-Australia Partnership on critical minerals,” Sunrise’s chairman Robert Friedland said.
“The world has entered an era in which access to critical minerals will shape industrial strength, technology leadership and national security.”
The conditional loan to the Australian company comes amid a renewed U.S. push to secure critical mineral supply. The U.S. will invest $3 billion in critical minerals and battery projects to reclaim “America’s rightful place as the minerals superpower of the world,” U.S. President Donald Trump said on Friday.
By Tsvetana Paraskova for Oilprice.com
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