American Resources focuses on rare earth from coal waste

FISHERS, IN - American Resources Corporation (NASDAQ:AREC), a micro-cap company with a market value of $41.58 million, has announced a strategic shift to leverage coal tailings as a primary feedstock for the production of heavy rare earth oxides. These oxides are currently in short supply globally and are essential for national defense and commercial industries. According to InvestingPro data, the company faces significant financial challenges, with its stock down nearly 60% over the past year.

The company’s subsidiary, ReElement Technologies, has developed a method to economically separate, purify, and refine coal waste concentrates, which traditional solvent extraction methods cannot effectively process due to impurities. ReElement’s chromatographic separation technique not only overcomes these challenges but also turns certain impurities into valuable byproducts. InvestingPro analysis indicates the company is rapidly burning through cash, with a concerning current ratio of 0.23, suggesting potential liquidity challenges ahead.

Mark Jensen, Chairman and CEO of American Resources and ReElement Technologies, stated that this technological breakthrough is timely, given the current shortage of heavy rare earth oxides. He emphasized the potential of millions of tons of already mined and stored material to reshape global resource dynamics.

American Resources is now concentrating on aggregating and processing mine waste to supply ReElement’s refining operations. The company has access to over 30,000 acres of land and estimates of over 128 million tons of waste material across Kentucky, West Virginia, and Indiana.

ReElement stands out as the only producer in the United States of heavy and light rare earth oxides at magnet-grade. It has secured contracts and agreements with an estimated 70% of the downstream market planning operations in the U.S. The company’s refining technology can be deployed locally and is scalable, making it suitable for various feedstock refining processes worldwide.

Moreover, American Resources has initiated the distribution of shares of ReElement Technologies and American Infrastructure Corporation to shareholders of record as of December 31, 2024. American Infrastructure common shares are being exchanged for Series A Preferred Stock in CGrowth Capital, Inc. ($CGRA), which is expected to rebrand as American Infrastructure Holding Corporation.

American Resources remains a significant shareholder in both ReElement and American Infrastructure Corporation, holding approximately 19% and 9% stakes, respectively.

This strategic development by American Resources, based on a press release statement, reflects its commitment to investing in and developing efficient critical mineral operations. The company continues to focus on mining, recycling, and manufacturing to support the growing global infrastructure and electrification markets. With a high debt-to-capital ratio of 0.85 and significant revenue decline, investors seeking deeper insights can access comprehensive analysis through InvestingPro’s detailed research reports, which cover over 1,400 US stocks and provide actionable intelligence for informed investment decisions.

In other recent news, American Resources Corporation has made significant strides through its subsidiary, ReElement Technologies Corporation, in refining rare earth elements from mine waste. The company announced advancements in a proprietary process that extracts mixed rare earth oxides from carbon waste streams, achieving concentrations consistently above 500 parts per million. This development is noteworthy as it taps into over 128 million tons of previously extracted waste material, with a particular focus on 8 million tons from their West Virginia property.

ReElement’s refining platform is designed to create a robust supply chain for critical minerals, reducing reliance on China’s dominance in the sector. The technology employed, including Ligand Assisted Displacement Chromatography, offers a cost-effective and environmentally friendly alternative to traditional methods. The subsidiary is also expanding operations with American Infrastructure Corporation to refine rare earth materials into ultra-pure products. Additionally, ReElement provided updates on its Marion, Indiana super-site, which is set to become the largest rare earth element and lithium refining facility in the United States. These developments are particularly relevant given the current trade tensions between China and the United States over critical minerals.

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