Shenghe Resources Expands Grip on Africa’s Rare Earth Sector

Highlights

• Perth-based Peak Rare Earths and China’s Shenghe Resources agreed to a A$96 million investment to develop the Ngualla Rare Earth Project in Tanzania.
• The project is one of the world’s largest and highest-grade neodymium-praseodymium (NdPr) rare earth deposits.
• Expected to create 600 direct and 3,000 indirect jobs during construction.
• Shenghe Resources, a prominent Chinese rare earth company, aims to finalize binding transaction documents by September 2024.
• The final investment decision is expected by December 31, 2024.

---

​In July 2024, Perth-based Peak Rare Earths (opens in a new tab) entered into a non-binding term sheet with China’s Shenghe Resources Holding Co., Ltd., (opens in a new tab) (Shenghe Resources) to develop the Ngualla Rare Earth Project (opens in a new tab) in Tanzania. Shenghe agreed to invest approximately A$96 million (US$63 million) to acquire a 50% stake in Ngualla Group UK, which holds an 84% interest in the project. This investment was structured to fully fund the project’s development, eliminating the need for additional equity from Peak shareholders. ​

The agreement stipulated that Shenghe would arrange debt financing for any remaining development costs and participate in the project’s engineering, procurement, and construction processes. Both companies aimed to finalize binding transaction documents by September 2024, secure shareholder approval by October 2024, and reach a final investment decision by December 31, 2024. ​

As of October 2024, Shenghe Resources further solidified its commitment by agreeing to invest an additional A$6 million in Peak Rare Earths, supporting the company’s ongoing development efforts for the Ngualla Project. ​Mining (opens in a new tab)

The Ngualla Rare Earth Project is recognized as one of the world’s largest and highest-grade neodymium-praseodymium (NdPr) rare earth deposits. The project is located near Ngwala Village in Tanzania’s Songwe Region and involves constructing a mine, mill, concentrator, and associated infrastructure. The development is expected to cost approximately US$320 million, create around 600 direct and 3,000 indirect jobs during construction, and provide 220 direct and 1,000 indirect jobs during operations. ​peakrareearths.com+1Magnetics Magazine+1 (opens in a new tab)

As of March 2025, no public updates have indicated the completion of the final investment decision or the commencement of construction activities for the Ngualla Project.

Songwe Region

Profile

​Shenghe Resources Holding Co., Ltd., founded in 1998, is a prominent Chinese company specializing in the mining, smelting, separation, and deep processing of rare earth elements. Headquartered in Chengdu, China, Shenghe offers a diverse product portfolio that includes rare earth oxides, salts, metals, metal catalysts, and molecular sieves. ​

 Western media such as Quartz reported that (opens in a new tab) the company’s ownership structure is mixed, with significant state involvement. Its largest shareholder is a research institute within the China Geological Survey, which operates under the Ministry of Natural Resources (opens in a new tab). Additionally, Shenghe maintains affiliations with major state-owned enterprises like the Aluminum Corporation of China (Chinalco), reflecting its close ties to the Chinese government. ​  Importantly, the Ministry of Natural Resources shareholder is part of the State of China. There are three branches of national government—The State, the Military (PLA), and the Party (CCP).

Financially, Shenghe has demonstrated robust performance. As of December 31, 2023, the company reported revenues of approximately 17.83 billion CNY (US$2.47b), marking a 6.79% increase over the previous year. The company employs around 2,235 individuals.

In the international arena, Shenghe holds a notable stake in MP Materials Corp., an American company that operates the Mountain Pass Rare Earths Project in California. As of December 2021, Shenghe owned about 7.7% of MP Materials’ stock. This investment underscores Shenghe’s strategic efforts to secure rare earth resources globally and strengthen its position in the international market.