Australian mining company Viridis Mining and Minerals has turbocharged its Brazilian operations after converting a preliminary agreement into a binding US$30 million (A$46 million) funding package with two heavyweight Brazilian investment firms.
Strategic Partnership Powers Development
The company confirmed it has executed a definitive agreement with Régia Capital and ORE Investments, with the first US$5 million tranche already received. This strategic partnership provides both the capital firepower and industry credibility needed to accelerate the Colossus rare earths project toward a final investment decision.
Under the carefully structured agreement, the funding will flow in four staged equity tranches over a maximum of 36 months, with built-in flexibility to accelerate payments as project milestones are achieved. The initial US$5 million tranche delivered 8,383,438 shares to the funders at 91 cents per share, matching the company's July capital raising price.
The pricing structure includes protective mechanisms for existing shareholders, with the second US$5 million tranche fixed at the higher of a 30-day volume weighted average price (with a 5% discount) or the 91-cent floor. For the larger third and fourth tranches of US$10 million each, the same VWAP-minus-5% rule applies but with a significantly higher minimum price of $1.50 per share.
Brazilian Expertise and Global Significance
The deal also grants Régia and ORE the right to nominate up to two directors as their stake grows, providing Viridis with deep Brazilian in-country expertise at the board level. This investment decision followed an intensive three-month due diligence process where the funders brought in rare earths experts, global consultants and environmental specialists to stress-test every aspect of the project.
Viridis Managing Director Rafael Moreno described the agreement as a "significant milestone" and "strong endorsement" of the Colossus Project's technical and economic fundamentals. The fact that the deal proceeded at premium pricing indicates the funders were satisfied with the project's geological and economic credentials.
The credibility of the Brazilian investors adds considerable weight to the project. Earlier this year, mining giant Vale and the national development bank BNDES entrusted Régia and ORE with managing Brazil's sovereign-backed strategic minerals fund, underscoring their standing in the industry.
Colossus: A Rare Strategic Asset
Located in Brazil's mineral-rich Poços de Caldas region, Colossus represents no ordinary deposit. It features one of the highest-grade ionic adsorption rare earths deposits found outside China and contains all four critical magnet metals: neodymium, praseodymium, dysprosium and terbium.
This makes Colossus one of the few projects globally capable of supplying the complete suite of critical magnet supply chains. The heavy rare earths are particularly valuable for their role in high-performance permanent magnets used in electric vehicles, drones, defence systems and offshore wind turbines.
The project's strategic importance has been amplified by China's recent moves to restrict rare earths exports. With China producing nearly 80% of global supply, Western governments and manufacturers are scrambling to secure independent, reliable sources of these critical materials.
A February scoping study revealed staggering projections, forecasting US$2.28 billion (A$3.50 billion) in EBITDA over a 20-year mine life. The operation is expected to generate annual EBITDA of US$114 million (A$180 million), primarily from neodymium and praseodymium production using combined spot prices of approximately US$60 per kilogram.
The production plan calls for output of 146 tonnes annually of these key metals for the first five years, increasing to 156 tonnes each year thereafter. The deposit also contains substantial quantities of samarium (6,285t), gadolinium (4,125t) and yttrium (13,553t), all included on China's export ban list.
Operating costs are projected at just US$6/kg of total rare earth elements, potentially making Colossus one of the lowest-cost rare earths operations worldwide.
Accelerated Development Timeline
With fresh funding secured, Viridis is advancing on multiple fronts. Environmental permitting remains the top priority, with the company awaiting approval of its preliminary licence from Brazilian environmental authorities after submitting earlier this year.
The company is also ramping up infill drilling programs to convert inferred resources into measured tonnes and proven reserves across its Northern Concessions, Southern Complex, and Tamoyos prospect.
On the development side, construction of the rare earths research and processing centre is progressing, targeting commissioning of a mixed rare earths carbonate demonstration plant by the end of March next year. Meanwhile, the definitive feasibility study, managed by engineering firm Hatch, remains on track for completion by June.
Perhaps most promising is the growing interest from export credit agencies, including Export Development Canada, Bpifrance and BNDES, all expressing support for the project. This positions Viridis to assemble a globally significant project finance package as offtake discussions continue.
With funding secured, due diligence completed and the first tranche in the bank, Viridis has cleared one of the major hurdles toward its final investment decision, expected by this time next year. If momentum continues, Colossus could soon emerge as one of the West's most strategically important rare earths developments.
