RareX Limited has successfully secured a substantial $50 million funding facility from international investment firm GEM Global Yield, contingent upon the successful acquisition of the strategically significant Mrima Hill critical minerals project in Kenya. This conditional financing arrangement represents a pivotal step in RareX’s ambitious expansion into East Africa’s burgeoning critical minerals sector, positioning the company at the forefront of global supply chain diversification efforts.
The flexible equity funding facility, structured in two equal tranches of $25 million each, provides RareX with discretionary access to development capital without minimum drawdown obligations. The first tranche becomes available upon successful consortium acquisition of Mrima Hill, while the second $25 million extension can be accessed as project development progresses.
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The Mrima Hill Opportunity: A Global Critical Minerals Prize
Mrima Hill represents one of the world’s most significant untapped critical minerals deposits, strategically located in Kwale County, Kenya, just 85 kilometers from the port city of Mombasa and 15 kilometers from the Indian Ocean coast. The project’s exceptional infrastructure advantages include proximity to sealed highways and geothermal power grids, positioning it as a potentially transformative development for Kenya’s mining sector.
The deposit currently holds a non-JORC NI43-101 resource of 150 million tonnes grading just under 4% total rare earth oxides, accompanied by 0.7% niobium and significant concentrations of manganese and phosphate. Industry estimates value the rare earth deposits at approximately $62.4 billion, while the niobium reserves are projected at $35 billion, making this potentially Kenya’s most valuable mineral discovery.
Strategic Consortium Partnership
RareX has formed a comprehensive consortium with Iluka Resources, Australia’s leading mineral sands producer, to pursue the Mrima Hill development opportunity. The partnership leverages complementary expertise, with RareX leading project de-risking activities while Iluka provides established processing infrastructure through its $1.65 billion Eneabba refinery facility in Western Australia.
Under the proposed joint venture structure, RareX would hold a 75% stake in the special purpose vehicle, with Iluka maintaining 25% ownership and securing long-term offtake rights for all rare earth and mineral sands products. The arrangement includes binding offtake terms with a 10% performance bonus, while preserving domestic Kenyan access to phosphate, manganese, and niobium for local steel and agricultural sectors.
Comprehensive Development Framework
The consortium has assembled a world-class team of technical partners to ensure responsible development practices from project inception. WSP, a leading global advisory firm, has been appointed to lead environmental and social foundational planning work, building on successful collaboration with RareX at the Cummins Range project in Western Australia.
Ausenco, the Australian-owned, majority US-controlled engineering firm, brings significant regional expertise to the partnership, having previously served as the leading EPCM company for the Kwale Mineral Sands Project in the same county. This regional knowledge provides exceptional local insights that enhance the consortium’s development approach.
Academic partnerships also strengthen the initiative, with Curtin University committed to supporting skills transfer to Kenyan professionals through a five-year sponsorship agreement. This educational component creates a skilled workforce pipeline while demonstrating the consortium’s commitment to sustainable, community-driven development.
Global Critical Minerals Context
The timing of RareX’s Mrima Hill pursuit aligns perfectly with unprecedented global demand for critical minerals essential to clean energy transitions. According to the International Energy Agency, the combined market value of key energy transition minerals is projected to more than double, reaching $770 billion by 2040, with copper alone achieving the current scale of iron ore markets.
Current global supply chains remain heavily concentrated, with China controlling over 90% of battery-grade graphite production and 77% of refined rare earths processing capacity. This concentration creates significant strategic vulnerabilities for Western economies, driving urgent efforts to diversify supply sources through initiatives like the U.S. Critical Minerals Program and similar policies across allied nations.
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Kenya’s Mining Investment Environment
Kenya’s mining sector has experienced significant transformation in recent years, with the government implementing progressive policies to attract international investment while ensuring community benefits. The 2024 Mining Investment Conference in Nairobi highlighted the sector’s potential as Kenya’s “next economic frontier,” with Mining Cabinet Secretary Hassan Ali Joho emphasizing strategic positioning for sustainable growth.
The regulatory framework governing Mrima Hill reflects Kenya’s commitment to transparent, competitive processes. The National Mining Corporation (NAMICO) oversees the evaluation of consortium proposals under the Kenya Mining Act, with final approval requiring Cabinet Secretary endorsement. This process ensures thorough evaluation of technical capabilities, environmental protections, and community benefit provisions.
Kwale County, where Mrima Hill is located, has demonstrated successful mining operations through the existing Kwale Mineral Sands Project operated by Base Titanium. This operational experience provides valuable precedents for community engagement, environmental management, and infrastructure development that benefit the broader mining sector.
GEM Global Yield: Strategic Funding Partner
GEM Global Yield, RareX’s funding partner, operates as a $3.4 billion alternative investment group focused on emerging markets worldwide. The firm has demonstrated significant experience in critical minerals financing, having recently provided funding facilities to various mining and materials companies globally.
The flexible structure of GEM’s facility aligns with RareX’s development timeline while providing strategic advantages beyond capital. GEM’s extensive network includes relationships with U.S. government agencies, potentially facilitating access to American markets and strategic partnerships as global supply chain diversification efforts accelerate.
Under the facility terms, RareX maintains full control over drawdown timing and has no minimum utilization requirements. Each drawdown occurs at 90% of the average daily volume weighted average price during the pricing period, with volume limitations based on recent trading activity to ensure minimal market impact.
Broader Strategic Implications
The Mrima Hill development, if successful, could establish Kenya as a significant player in global critical minerals markets while advancing Australia’s strategic objectives for secure supply chain development. RareX Managing Director James Durrant emphasized the project’s potential to create “a unique and independent mine to rare earth metal solution, backed by allied governments,” strengthening diplomatic relations between Commonwealth allies.
The initiative aligns with broader African mineral development strategies, as continental governments increasingly recognize critical minerals as key drivers of economic transformation. The African Minerals Development Centre is developing an African Green Minerals Strategy to guide resource-rich countries in maximizing benefits from mineral wealth while ensuring sustainable practices.
For Kenya specifically, successful development could generate substantial government revenues through the established royalty framework: 5% for rare earths and 3% for niobium, with 80% flowing to central government, 15% to Kwale County, and 5% directly to local communities.
Risk Factors and Market Challenges
Despite the significant opportunity, the Mrima Hill project faces several challenges typical of large-scale mining developments in emerging markets. Regulatory approval remains subject to NAMICO and Cabinet Secretary discretion, with no guarantee of successful consortium selection despite comprehensive proposal submission.
The broader critical minerals market faces supply-demand imbalances across key commodities. Current projections indicate anticipated mine supply from announced projects meets only 70% of copper requirements and 50% of lithium demand through 2035, creating both opportunity and execution risk for new developments.
Environmental and social challenges require careful management, particularly given Mrima Hill’s location in a region with existing mining operations and established community expectations. The consortium’s early engagement of environmental specialists and commitment to international best practices demonstrates recognition of these challenges.
Technology and Processing Innovation
The Mrima Hill development benefits from RareX’s specialized expertise in carbonatite deposits, which represent a high-value niche within the critical minerals sector. Both Mrima Hill and RareX’s Australian Cummins Range project feature similar geological characteristics, enabling knowledge transfer and operational synergies.
Iluka’s Eneabba refinery provides proven processing capabilities for rare earth materials, supported by Australian government backing through non-recourse loans. This integrated approach from mine to refined product offers significant competitive advantages in serving global markets while ensuring quality control throughout the value chain.
The consortium’s commitment to establishing local laboratories and pilot plants in Kenya ensures technology transfer and skills development, creating lasting benefits for the local workforce and potentially supporting additional mining developments in the region.
Looking Forward: Transformational Potential
RareX’s $50 million funding facility represents more than project financing; it positions the company for potential leadership in East Africa’s critical minerals development while contributing to global supply chain resilience. The discretionary nature of the facility allows strategic timing of capital deployment based on regulatory approvals and market conditions.
For Kenya, the Mrima Hill development could catalyze broader mining sector growth while demonstrating the country’s capability to host world-class mineral operations. The project’s strategic location and infrastructure advantages position it as a potential cornerstone of a critical minerals hub serving global markets from East Africa.
The consortium’s comprehensive approach, combining technical expertise, environmental stewardship, educational partnerships, and community engagement, establishes a development model that could influence future mining investments across the African continent.
As global demand for critical minerals continues accelerating driven by clean energy transitions, projects like Mrima Hill represent essential components of supply chain diversification efforts. RareX’s successful securing of conditional financing demonstrates investor confidence in both the project’s technical merits and Kenya’s emerging position as a preferred mining investment destination.
The coming months will prove critical as NAMICO evaluates consortium proposals and the Cabinet Secretary considers final approvals. Should RareX’s consortium succeed, the Mrima Hill development could mark a transformational moment for Kenya’s mining sector while advancing global critical minerals security objectives.
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By: Montel Kamau
Serrari Financial Analyst
25th September, 2025
