The Lynas Rare Earths Ltd (ASX: LYC) share price is marching higher in morning trade.
Lynas shares closed yesterday trading for $8.88 and are currently trading for $9.43, up 6.19%.
This comes as the S&P/ASX 200 Index (ASX: XJO) rare earths producer announced a half-billion-dollar expansion plan for its flagship project.
Lynas share price lifts off on $500 million project expansion
The Lynas share price is shrugging off the broader market selling pressure today after the miner announced a $500 million project to expand capacity at its Western Australia Mt Weld mine and concentration plant.
Lynas said the expansion is needed to meet fast-growing global demand for rare earth materials and NdFeB (neodymium) magnets.
According to the release, global demand for NdFeB magnets is expected to grow from 130,000 tonnes in 2020 to 265,000 tonnes by 2030. Most of the increase in demand stems from the fast-growing electric vehicle and wind turbine markets.
The miner said that in order to grow with the market, the "ambitious" 2025 growth plan it announced in May 2019 "must be accelerated and increased".
As part of the accelerated growth plan, today Lynas announced a project that will substantially expand Mt Weld feedstock capacity, targeting 12,000 tonnes per annum NdPr (neodymium praseodymium) equivalent in 2024.
The initial expansion has been fully scoped and Lynas reported the roughly $500 million investment for this stage of the project is fully funded from cash flow. It added that the expansion project is based on known technology. The company says it will create some 300 jobs during the construction phase and more than 100 ongoing operational jobs.
What did management say?
Commenting on the project expansion plans that look to be driving the Lynas share price higher today, CEO Amanda Lacaze said:
This investment is supported by our high grade, long life and reliable source of feedstock, the remarkable Mt Weld ore body. Having a long life resource is an essential foundation for success in the rare earths market and the recent 1 kilometre deep drilling has demonstrated Mt Weld's potential to supply feedstock for many years into the future.
The Mt Weld capacity expansion project aims to unlock its true value in the most efficient and sustainable way to 2025 and beyond.
Lynas share price snapshot
Though struggling in 2022, the Lynas share price remains up 22.8% over the past 12 months. That compares to a full-year loss of 7% posted by the ASX 200.
