Aclara's Water Bet in Chile: Sustainability as Strategy, Not Sideshow

Highlights

• Aclara Resources will relinquish all natural water rights for its US$130M Penco project in Chile, implementing a circular water system that recirculates 95% of water and eliminates conventional tailings.
• The project targets 50 tonnes per year of strategic heavy rare earths (dysprosium and terbium) over 14 years starting 2028, using clay-hosted deposits that avoid blasting and crushing.
• By removing competition for local water resources, Aclara positions sustainability as core to permitting strategy amid legal challenges, with final approval expected by Q1 2026.

Aclara Resources (opens in a new tab) (ARA.TO) has taken a notable step to strengthen the credibility of its Penco rare earths project in Chile, announcing it will relinquish all rights to natural water sources and instead rely on a circular water economy. The Canada and Chile-based company says its proprietary “circular mineral harvesting” system will recirculate approximately 95% of water, avoid liquid industrial waste discharge, and eliminate the need for conventional tailings—an unusually ambitious sustainability posture in the rare earth sector.

Cited in BNAmericas (opens in a new tab), the US$130 million Penco project, located in Chile’s Biobío Region, is planned to produce an average of 50 tonnes per year of strategic heavy rare earths, including dysprosium (Dy) and terbium (Tb), over a 14-year mine life beginning in 2028. Because the rare earths are hosted in clay, the operation avoids blasting, crushing, and grinding. Aclara also plans to rely on renewable energy and a fertilizer-based reagent, contributing to a significantly reduced carbon and environmental footprint compared with conventional hard-rock mining.

From a Rare Earth Exchanges™ perspective, this matters for two reasons. First, water use and waste management are among the most contentious issues in rare earth extraction, particularly in OECD jurisdictions where social license can determine project viability. Second, Dy and Tb are among the most strategically sensitive heavy rare-earth elements, essential for high-performance permanent magnets used in electric vehicles, wind turbines, and advanced defense systems.

Aclara still faces legal challenges from local communities and environmental groups, and final approval from Chile’s Environmental Evaluation Service is expected no later than Q1 2026. However, by pre-emptively removing competition for local water resources, the company is signaling that sustainability is likely not a marketing issue—it is core to its permitting strategy. If approved, Penco would stand out as one of the most environmentally constrained yet geopolitically relevant rare earth supply options outside Asia.

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