REalloys Inc. has been conditionally selected by the United States Army to enter into exclusive contract negotiations for a long-term Enhanced Use Lease to design, finance, build, and operate critical-mineral processing facilities at the Tooele Army Depot in Utah. This partnership aims to establish domestic heavy rare earth processing capacity for elements foundational to the warfighting capability of the U.S. Joint Forces. The agreement is executed through the Army’s Strategic Capital Initiatives and marks the first commercial critical-mineral processing award on a Government military installation via a direct execution of Executive Order 14241.

The planned facilities will refine heavy rare earths, including dysprosium and terbium, which are essential to national security and used in the Defense Industrial Manufacturing Base for high-temperature permanent magnets. These magnets are critical for precision-guided munitions, electric motors, sonar, and other key systems. The conditional selection is made possible through an Enhanced Use Lease, a statutory authority under 10 U.S.C. § 2667, which allows the Army to lease non-excess, underutilized land to private-sector partners without taxpayer subsidies.

Leonard Sternheim, Chief Executive Officer of REalloys, said the selection validates the company's mine-to-magnet strategy and addresses the urgent national need for domestic heavy rare earth capability. He emphasized that dysprosium and terbium are central to high-temperature magnets in advanced defense systems, and currently, almost all processing occurs overseas. The partnership aims to build secure, allied-sourced capacity without risking taxpayer dollars, targeting the 2027 deadline customers are racing to meet.

The development timeline targets an Initial Operating Capability no later than 2028, aligning with expanded U.S. federal procurement restrictions on Chinese rare earth content. The facility will extend REalloys’ fully integrated mine-to-magnet strategy, drawing on secure, allied feedstock, including Canadian heavy rare earth supply. No construction will begin until rigorous environmental and regulatory reviews, including the National Environmental Policy Act (NEPA), the Clean Air and Water Acts, and all required federal, state, and local permits, are complete.

General Jack Keane (Ret.), Board Director of REalloys, commented that the Army's decision to leverage its installations for domestic rare earth processing is strategically sound and operationally necessary. He believes REalloys’ zero-adversary-nexus supply chain aligns with the Joint Force's need for uninterrupted access to heavy rare earth elements. Stephen duMont, Chairman of REalloys, added that the activity represents a strategic inflection point for establishing a sovereign and secure heavy rare earth processing capability in the United States.

REalloys Inc. is advancing its defense-grade supply chain capabilities through a landmark arrangement with the Saskatchewan Research Council to secure high-purity Dysprosium and Terbium oxides. The company is scheduled to receive these rare earth materials for qualification as early as Q4 2026. This initiative is designed to support customer qualification and supply chain validation ahead of a critical regulatory deadline.

The partnership targets the January 1, 2027, enforcement of DFARS 252.225-7052. Following this date, rare earth materials of Chinese origin will become non-compliant for covered U.S. defense procurements. By securing alternative sources, REalloys aims to ensure its supply chain meets the strict requirements necessary for defense contracting.

Strategic Qualification Timeline

The delivery schedule for the rare earth oxides is aligned with the compliance timeline, allowing sufficient time for validation processes.

The Saskatchewan Research Council will serve as the supplier for these critical materials. The arrangement positions REalloys to navigate the shifting regulatory landscape for defense-grade components.

Exclusive Supply and Production Strategy

REalloys has secured exclusive offtake for 80% of the commercial output from the Saskatchewan Research Council's heavy rare earth separation and metallization facility. This provides a unique North American source of Dysprosium, Terbium, and NdPr materials for downstream magnet manufacturing. The facility's initial commercial production remains on track for early 2027. Additionally, REalloys is continuing development efforts toward a wholly owned heavy rare earth metallization facility with support from the Saskatchewan Research Council, which is expected to be one of the only commercial-scale North American sources of Dysprosium and Terbium metals.

Leadership Perspective

"With the DFARS January 1, 2027, deadline now less than seven months away, we want to begin qualifying North American dysprosium, terbium, and other rare earth materials for defense and industrial permanent magnets," said Lipi Sternheim, REalloys CEO. "Through our partnership with SRC and our downstream metallization strategy in Ohio, we believe that REalloys is positioning itself to become a leading North American supplier of the heavy rare earth materials required for compliant defense supply chains."