MP Materials Awarded $35M DoD Contract for Rare Earth Processing

MP Materials Corp. has been awarded a $35 million contract through the U.S. Department of Defense (DoD) Industrial Base Analysis and Sustainment Program to support the construction of a commercial scale processing facility for heavy rare earth elements (HREE) at Mountain Pass.  

Located in southeastern California near Las Vegas, the mine is the only active and scaled rare earth production site in North America. LHREEs have higher atomic weights and are generally less abundant than light rare earth elements (LREEs). They are essential inputs to many critical defense and commercial technologies, particularly permanent magnets instrumental to the performance of electric vehicles, wind turbines, drones, and missile systems.  

In a separate contract awarded in December 2020, the DoD committed $9.6 million to MP Materials’ Stage II optimization, a project underway to restore LREE processing capabilities to Mountain Pass. The ability to process HREEs alongside LREEs will enable the company to extract and refine all rare earths required to manufacture high-performance permanent magnets. It will also enable the company to recycle all recoverable rare earths from end-of-life magnets and magnet production scrap, increasing the resiliency and environmental sustainability of the domestic supply base. 

“The ability to mine, process, and refine rare earths at Mountain Pass is foundational to a national effort to secure the U.S. rare earth supply chain,” said MP Materials Chairman and CEO, James Litinsky. “We thank the Department of Defense for its confidence and support.” 

In addition to its mining and processing operation at Mountain Pass, MP Materials is developing a rare earth metal, alloy and magnet manufacturing facility in Fort Worth, Texas. Materials sourced from Mountain Pass will be transformed into manufactured products at this new facility, restoring a wholly domestic and vertically integrated U.S. magnetics supply chain. 

In December 2021, MP Materials entered into a long-term agreement with General Motors to supply domestically sourced and manufactured rare earth materials, alloy, and finished magnets for the electric motors used in the GMC HUMMER EV, Cadillac LYRIQ, Chevrolet Silverado EV, and more than a dozen models using GM’s Ultium Platform.  

“The U.S. needs to continue to push the scientific envelope to develop secure, reliable, and affordable domestic source critical minerals used in defense and commercial manufacturing in order to reduce its dependence on foreign sources in a time of global economic competition,” said Deborah Rosenblum who is performing the duties of Assistant Secretary of Defense for Industrial Base Policy.  

To meet growing magnetics demand and promote supply chain resiliency, MP Materials’ processing facilities at Mountain Pass will accept qualified third-party feedstock and end-of-life magnets, in addition to processing the ore extracted from and beneficiated at Mountain Pass. The site is a closed loop, zero-discharge rare earth production facility with a dry tailings process that recycles more than one billion liters of water per year. 

MP Materials is the largest producer of rare earth materials in the Western Hemisphere but currently has to ship much of its output to China for processing. Intent on changing this situation, the company is building its processing and downstream production operations. See