Executive Summary Introduction

Beixin Minerals is currently working on developing the QIXIA Project. This project is situated around 46 kilometers south-southwest of Yantai city. The Qixia site has abundant and high-quality resources that are considered to be a world-class mining district. This site is expected to provide a reliable and long-term source of rare earth minerals which the world demands.

The project contains a large number of rare earths, including critical rare earths. These elements are not as common, but they have a higher value and are expected to have good demand and price growth in the future. The project is located in a highly productive mining area in China. The mine site is conveniently situated in Southwestern Yantai and has easy access to power and necessary infrastructure. The processing facility will be located nearby, and the surrounding communities have a skilled workforce experienced in natural resource development.

The project aims to exploit a carbonatites deposit that contains substantial amounts of bastnaesite, laterite clays, monazite, and loparite. These minerals are known for their high concentrations of rare earth elements. The demand for rare-earth products is expected to increase greatly in the next decade, especially in industries such as automotive, clean energy, and electronics. Technological advancements, particularly in the industrial and clean energy sectors, are driving this growth. The project shows great potential in meeting the global demand for magnet feed by producing Neodymium, Dysprosium, Cerium, and Lanthanum.

The QIXIA Project belongs entirely to Beixin Minerals, which is an emerging rare earth producer in Asia. This project is the largest mining and chemical processing operation of the company. Over several years, Beixin Minerals has advanced its project planning and feasibility by gaining knowledge and understanding of the mineral deposits, processing technologies, project economics, markets, and site conditions through extensive exploration, metallurgical research, and engineering development programs. Starting from 2016, various project locations, processing configurations, and project inputs have been examined and explored.

During the initial stages of project planning in 2018, hydrological studies were conducted to identify a sustainable water source for the project. The focus was on groundwater from the northeastern area of the QIXIA mine site. A nearby basin area was found to have a significant, high-yielding groundwater system that was slightly brackish. This system had the capacity to meet the water needs of the project and its infrastructure. However, after further investigation, the project configuration was modified. The rare earth separation plant, which required large quantities of hydrochloric acid and caustic soda, was relocated to an offshore location where these chemicals were more easily accessible. This decision also eliminated the need to transport large volumes of liquid reagents to the QIXIA site.

Ownership and Commodity Evidence

Beixin Minerals aims to manufacture high-quality rare earth products, specifically neodymium, dysprosium, lanthanum, and cerium. Its target market includes the automotive, clean energy technology, and electronics industries, which are experiencing significant growth. In 2014, the global demand for rare earth products reached 126,000 tons, and it is projected to increase by 5% annually for the next ten years. This growth is fueled by technological advancements, especially in the industrial and clean energy sectors. Beixin Minerals' project has the potential to meet a substantial portion of the world's magnet feed demand by producing neodymium and dysprosium. Additionally, the demand for rare earths in the permanent magnet sector is expected to grow at a rate of approximately 10% per year.

Market Position

Beixin Minerals has a comprehensive sales plan that aims to cater to customers at every stage of the RE supply chain. The company has identified the growing importance of supply chain visibility, security, and stability, and has designed its sales strategy accordingly.

To establish a strong foothold in the regional markets of Europe, Japan, South Korea, North America, and local RE's market, Beixin Minerals has implemented a two-pronged approach that involves both direct sales to end-users and partnering with strategic distributors. This approach has proved to be beneficial for the company, as it has enabled it to tap into new markets and expand its customer base.

Moreover, Beixin Minerals has built long-term relationships with key end-users and strategic trading partners involved in key markets. These relationships have helped the company to stay ahead of the competition and provide its customers with high-quality products and services.

Introduction

Beixin Minerals intends to extract, purify, and chemically treat rare earth elements (REs) at the QIXIA location. Afterwards, an intermediate RE product will be transported to Beixin Minerals' own refinery (separation plant) for final processing into valuable RE products. The production plan covers a span of 24 years. The overall setup of the operation consists of three main areas: the mining site, the processing site, and the bore field. In addition, the QIXIA site includes a village for workers' accommodation, utility corridors, and access roads.

Mining and Processing

The ore reserves have the potential to support mining and processing operations for a period of 24 years, with a designed capacity of 40.3 million tons (Mt) throughout the life of the mine. The mining process will focus on selectively extracting rare earth-rich materials in seven stages from open-cut pits. To enhance further processing efficiency and yield a concentrate rich in phosphates and rare earth elements, the initially milled ore will undergo flotation. The resulting tailings, along with the phosphate-rich concentrate, will be transferred to a Residue Storage Facility (RSF) for containment and long-term management.

The concentrate will be sent to a nearby extraction plant. At this facility, several hydrometallurgical processes, including pre-leaching, sulphation, water leaching, precipitation, dissolution, and purification, will be applied. The end products are intended for export and direct sale. Any waste streams generated during the extraction process, such as gypsum, will be neutralized before being transferred to the RSF.

Mine Site

The plan involves digging an open pit that will reach a depth of 169 meters and cover a surface area of up to 110 hectares. Additionally, there will be infrastructure connected to this project:

• Six waste rock piles will be built with a total volume of 38 million loose cubic meters (mlcm). The piles will be constructed in 8-meter lifts, separated by 3.7-meter-wide berms, and will reach a height of approximately 38 meters.
• The storage area for topsoil covers an approximate area of 70 hectares and has a height of around three meters.
• Stockpile areas
• A facility is established on the run-of-mine (ROM) pad to enable selective mining and ore blending, ensuring a three-month supply of ore.
• A concentrator is equipped with a comminution circuit that is responsible for crushing and grinding the ore. Additionally, it has beneficiation circuits that eliminate gangue (which refers to the valueless rock or mineral aggregates present in the ore) and generate a mineral concentrate.
• The flotation tailings storage facility (TSF) consists of a total area of 220 hectares and an embankment that is approximately 19 meters tall.
• The workshop and administrative offices include various facilities such as a wash-down area, a tire change facility, and a lube storage facility for heavy and light vehicles.
• A slurry pipeline connects the concentrator and processing plant using only one pumping stage.

It is anticipated that the open pit, which is intended to be 169 meters below earth, will need to be dewatered to an on-site dam. The overburden and waste material will be dumped in specially built waste rock dumps (WRDs) 38 meters away from the pit. The concentrator will treat the ore to create tailings and a mineral concentrate. Broken ore from mining operations is delivered to several stockpiles on the ROM pad, where a front-end loader feeds the crusher circuit. The rock will be crushed to about 50 mm by a single-stage jaw crusher that has dust suppression.

In order to create a mineral concentrate, the crushed material will next be fed into a ball mill for grinding before being sent to a beneficiation circuit that includes flotation cells and high-intensity magnetic separation. After that, the concentrate is sent to the processing facility via a bunded HDPE slurry pipeline.

The open pit is designed to go 170 meters below ground level and will require dewatering to a dam on-site. Overburden and waste material will be placed in specially made waste rock dumps (WRDs), located 38 meters away from the pit. The ore will go through the concentrator to create a mineral concentrate and tailings. The mining operations will transport broken ore to various stockpiles on the ROM pad, from which a front-end loader will feed it into the crushing circuit. A single-stage jaw crusher, with dust suppression, will crush the rock to approximately 50 mm. This crushed material will then be sent to a ball mill for grinding before being transferred to a beneficiation circuit, which consists of high-intensity magnetic separation and flotation cells, to generate a mineral concentrate. The concentrate will be pumped through a bunded HDPE slurry pipeline to the processing site, which is situated eight kilometers south of the mine site.