Vital Metals (ASX: VML; US-OTC: VTMXF), the only rare earths producer in Canada, is pressing pause on construction of its half-finished Saskatoon processing facility after determining that its plans to market an intermediate product from the plant aren’t economic.
It also said the scale of mining at Vital's North T zone at its Tardiff rare earth project in the Northwest Territories isn’t economic.
Before a trading halt on the company’s stock on Apr. 18, shares were down by more than a quarter, falling to A1.1¢ on the ASX for a market cap of A$43.8 million. The shares have traded between A1¢ and A7.2¢ over the past year.
In a release on Wednesday, the company said it wasn’t able to sell its intermediate REE product “on commercially satisfactory terms” and pinpointed both higher plant costs and lower rare earth prices as factors in its decision to pause plant construction.
“There is no economic imperative to complete this demonstration project at the current time,” said Vital’s interim chairman Richard Crookes. “However, the Saskatoon processing facility can provide valuable intermediate processing capacity for a downstream rare earth hub in Saskatchewan. North America needs independent downstream processing to further enable the transition to the green economy and Vital is looking forward to working with like-minded parties to deliver a completed project.”