Aclara Louisiana HREE Plant Wins $21mn Tax Incentive

Aclara

Aclara Louisiana HREE plant has secured an estimated $21mn tax incentive as the Canadian developer advances plans for a heavy rare earth separation facility in the US. The Louisiana government approved an 80% exemption from ad valorem property taxes for an initial five-year period.

Aclara Louisiana HREE plant is expected to save about $4.2mn/yr in property taxes, totaling roughly $20.8mn during the first term. The incentive can also be renewed for another five years.

Aclara Louisiana HREE plant will process mixed rare earth carbonates from the company's ionic clay projects in Brazil and Chile into separated rare earth oxides. Planned products include dysprosium, terbium, yttrium, gadolinium and samarium.

The company is targeting groundbreaking in the fourth quarter of 2026 while continuing engineering, permitting and financing work.

Louisiana Plant Targets Heavy Rare Earth Bottleneck

The proposed separation facility is designed to produce 1,131 t/yr of neodymium-praseodymium oxide, 148 t/yr of dysprosium and 25 t/yr of terbium.

The dysprosium and terbium capacity is particularly important because these heavy rare earths remain among the most supply-constrained materials in the permanent magnet value chain.

Both elements are used to improve the high-temperature performance of NdFeB magnets used in electric vehicles, aerospace, defence, robotics and advanced industrial motors.

Aclara's planned facility therefore targets a processing stage that remains difficult to replicate outside China.

The project also gives the US access to feedstock sourced from two South American jurisdictions. Aclara's Carina project in Brazil and Penco project in Chile are expected to provide mixed rare earth carbonate for downstream separation in Louisiana.

This structure links Latin American ionic clay resources with US processing capacity and creates a more geographically diversified heavy rare earth supply chain.

Tax Support Improves Economics but Financing Remains Critical

The Louisiana tax exemption reduces long-term operating costs and improves the project's investment case.

Property tax relief is especially valuable for capital-intensive separation plants because they require significant fixed infrastructure, specialised chemical systems and environmental controls.

However, the incentive alone will not determine whether the project reaches production. Aclara still needs to complete engineering, secure permits and close the financing required for construction.

Feedstock development is equally important. The Louisiana facility depends on Aclara successfully bringing its Brazilian and Chilean rare earth projects into production.

If those projects advance as planned, the company could control a supply chain stretching from ionic clay extraction through mixed carbonate production to separated rare earth oxides.

That integration would give Aclara a stronger position in the ex-China rare earth market and could make the Louisiana plant an important source of dysprosium and terbium for US magnet manufacturers.

The Metalnomist Commentary

Aclara is targeting one of the most difficult gaps in the western rare earth chain: heavy rare earth separation. The Louisiana incentive improves project economics, but the real strategic value will depend on linking South American feedstock with reliable US dysprosium and terbium production.