Highlights

• Magnetite Mines discovers near-surface rare earth element mineralization in clay-rich horizons at Ironback Hill Project in South Australia
• Initial drill sample re-assays show TREO grades ranging from 356 ppm to 1,153 ppm, with potential for mild leaching extraction
• Early-stage exploration aims to evaluate economic potential of clay-hosted REE deposits alongside existing Razorback Iron Ore Project

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Magnetite Mines (ASX:MGT) has announced (opens in a new tab) the discovery of near-surface, clay-hosted rare earth element (REE) mineralization at its 100%-owned Ironback Hill Project in South Australia’s northeast, adjacent to its large Razorback magnetite iron ore deposit.

The REEs were detected by re-assaying archived drill samples originally collected in 2011–2012 during iron ore exploration. Key intersections reported include:

• 8m @ 1,153 ppm Total Rare Earth Oxides (TREO), including 215 ppm Nd₂O₃ (a key magnet element), within 18m @ 866 ppm TREO (Hole PLRC0053).
• 6m @ 816 ppm TREO (190 ppm Nd₂O₃) within 20m @ 583 ppm TREO (Hole PLRC0056).
• 4m @ 977 ppm TREO within 20m @ 608 ppm TREO (Hole PLRC0059).

Grades range between 356 ppm and 1,153 ppm TREO, applying a 350 ppm cut-off.

What This Means

Clay-hosted REE deposits, particularly ion-adsorption clays, are attractive because they can sometimes be leached under mild conditions, avoiding the costly and environmentally challenging processing of hard-rock REE ores. Ironback Hill sits within clay-rich horizons associated with drainage features, which is a favorable geological setting.

Magnetite Mines emphasized that this is early-stage work:

• No metallurgical testing has yet been conducted.
• Recoveries and economic potential are unknown.
• No estimate of resource size or grade continuity is possible at this stage.

The company will now undertake low-cost leachability testwork to evaluate whether the REEs are ionically bound and economically recoverable.

Strategic Context

While the Razorback Iron Ore Project remains Magnetite Mines’ core focus, the company is reviewing its broader South Australian tenement package for critical minerals potential. This pivot mirrors a growing trend among Australian iron ore juniors: leveraging existing drill datasets to identify battery and rare earth opportunities in response to strong global demand.

Key Questions for Investors

• Economics: Will follow-up metallurgical testing show REEs are recoverable at commercial levels?
• Scale: Are these intercepts isolated, or do they signal a larger, continuous clay-hosted system?
• Capital Allocation: With limited resources, can Magnetite Mines realistically progress both Razorback and a new REE program?
• Competition: How does Ironback Hill compare with other clay-hosted REE projects in Australia, such as those in Western Australia and the Northern Territory?

For investors, the Ironback Hill assays are intriguing but highly preliminary. Unlocking value will hinge on proving leachability, scalability, and economics in what is becoming a crowded but strategically vital REE exploration field.

Source: Magnetite Mines Limited, ASX Announcement, 19 August 2025

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