A remote Australian town will become a "cornerstone" of the Western supply of scandium, a rare earth needed for defense, planes and data centers, miner Sunrise Energy Metals said on Saturday after a $400 million US pledge.
The Pentagon announced a $400 million conditional loan commitment to Sunrise to build the world's first primary mine for scandium, of which China dominates supply and processing, at a meeting between President Donald Trump and mining executives in Washington.
Scandium is usually sourced as a byproduct of other mining.
"We aim to establish Syerston as a cornerstone of Western scandium supply," Sunrise chairman Robert Friedland said in a statement, referring to the proposed mine in Fifield, New South Wales state.
Fifield is around 450 kilometers (280 miles) west of Sydney.
New South Wales has some of the highest concentrations of scandium globally, the state government said.
China restricted exports of scandium for defense products last year, triggering the US search for new suppliers.
The Pentagon statement said the scandium project will "ensure Western alignment from mine to finished product".
Trump and Australian Prime Minister Anthony Albanese signed a critical minerals agreement aimed at countering China in October, pledging that each would invest $1 billion in projects.
Sunrise struck a deal with Lockheed Martin last year to sell the defense and aerospace manufacturer 25 percent of its scandium output for the first five years of the mine.
The company will make an announcement to the Australian Securities Exchange on Monday, Friedland said.
