CoTec Holdings Corp. said its 50:50 joint venture, HyProMag USA LLC, has completed an independent Pre-Feasibility Study assessing a potential expansion of its proposed U.S. rare earth magnet manufacturing platform. The plan would add three plants to the first facility in Northlake, Texas, with a centralized hub planned within a second Texas location.
#Three-plant expansion proposal
The study examines new production sites in South Carolina, Nevada and a second Texas location. The proposed Central Texas Hub would support the plants with alloy processing, magnet finishing, quality assurance, customer qualification and technology development.
The new facilities would use Hydrogen Processing of Magnet Scrap technology to process recycled magnet feedstock. One development case also includes primary neodymium iron boron alloy as an additional feedstock source. The Northlake Texas Facility is currently in detailed engineering, and Phase 1 commissioning is expected in mid-2028.
#Production targets and proposed configuration
HyProMag USA’s proposed four-plant platform, including Northlake, targets approximately 6,000 metric tons per year of total salable material production by 2034. The target comprises approximately 4,192 metric tons of magnets, 1,305 metric tons of magnetic NdFeB alloy powder and 503 metric tons of other salable material.
The proposed expansion would increase magnet production from approximately 1,048 metric tons per year at the Northlake Texas Facility to approximately 4,192 metric tons per year across four plants by 2034. These figures are targets described in the study, not completed production.
Under the proposed layout, the South Carolina, Nevada and second Texas plants would produce unfinished sintered NdFeB blocks. Those blocks would then be transferred to the Central Texas Hub for further processing and finishing. The hub is expected to include vacuum induction melting, strip casting, grain boundary diffusion, machining, plating, passivation, epoxy coating and product qualification capabilities.
#Study economics
For the three proposed plants and the Central Texas Hub, excluding the Northlake Texas Facility, the study indicates an estimated post-tax NPV of US$1,854 million for Case 2 to US$2,062 million for Case 1. The corresponding post-tax IRR is 31% for Case 2 to 36% for Case 1.
Case 1 covers recycled feedstock only. Case 2 includes the additional capital expenditure required to use primary NdFeB alloy alongside recycled material. The study gives a Class 3 AACE capital cost estimate of approximately US$656 million for Case 2 and US$623 million for Case 1. Payback is stated as 3 years for Case 2 and 2.3 years for Case 1.
The study’s financial outlooks use forecast prices, a 7% real discount rate and a tax rate assumed at 21% excluding state taxes. The NPV calculations do not include potential government or state incentives or carbon pricing.
#Manufacturing costs and Northlake valuation
For the first proposed PFS plant in 2030, the study estimates All-In Sustaining Cost of approximately US$41.6 per kg for Case 2 to US$37.4 per kg for Case 1 of finished NdFeB products sold. Based on forecast market prices and the forecast product mix, the weighted average realised all-in selling price in 2030 is estimated at approximately US$100.5 per kg.
CoTec also reported an updated post-tax NPV of approximately US$723 million for the Northlake Texas Facility, based on forecast prices and a capital cost estimate of approximately US$167 million. The company said the figure is lower than the post-tax NPV of approximately US$797 million announced on June 22, 2026, citing the later construction timetable, higher capital costs and updated operating cost assumptions.
The combined post-tax NPV of the proposed Northlake facility and the potential PFS plants is estimated at US$2.6 billion to US$2.8 billion. The PFS results for the three new plants do not include the value of the Northlake Texas Facility.
#Feedstock, product mix and operations
The proposed platform is designed to process both end-of-life recycled material and primary alloy feedstock. The study says the facilities would incorporate grain boundary diffusion capability, with high-grade magnet production increasing from approximately 10% to 20% of total magnet output.
The plants are also designed to recover manufacturing residues, including magnet machining end cuts, through the HPMS process. The Central Texas Hub could additionally support third-party magnet finishing activities, although the source describes this as a future opportunity rather than an operating activity.
A previously completed carbon footprint assessment for the Northlake Texas Facility reported approximately 2.35 kg CO₂-eq per kilogram of NdFeB sintered block product. No carbon assessment has been completed for the PFS plants, and their carbon production footprint may vary from the Northlake assessment.
#Qualification, employment and next steps
HyProMag USA said product performance data and customer validation are underway with potential U.S. offtake customers. Commercial magnet qualification activities are also continuing across the wider HyProMag Group in the United Kingdom and Germany.
The proposed platform is expected to create approximately 300 jobs across Texas, South Carolina and Nevada, in addition to the 100 positions at the Northlake Texas Facility.
Subject to ongoing review, the expansion strategy is expected to progress to a Feasibility Study at the appropriate time. The projections and proposed development schedule depend on assumptions including financing, required permits and approvals, feedstock availability, equipment availability and the terms assumed in the study.
#Risks and study assumptions
CoTec said actual results could differ materially from the study’s estimates. Identified risks include financing availability, environmental and permitting requirements, labour costs and shortages, changes in material and energy prices, equipment availability and performance, contractor performance, project delays, cost overruns, extreme weather, transport or geopolitical disruptions, suitable feedstock availability, and the ability to secure customer offtake and feedstock supply arrangements.
The company also cautioned that rare earth and magnet prices may change and that the accuracy of the study depends on its underlying estimates and assumptions. The stated financial metrics are financial outlooks intended to illustrate the potential economics evaluated in the study and may not be appropriate for other purposes.
#Key Takeaways
- HyProMag USA’s independent Pre-Feasibility Study assesses three proposed plants in South Carolina, Nevada and a second Texas location.
- The three-plant expansion and Central Texas Hub indicate an estimated post-tax NPV of US$1,854 million for Case 2 to US$2,062 million for Case 1.
- The proposed four-plant platform targets approximately 6,000 metric tons per year of total salable material by 2034.
- Phase 1 commissioning at the Northlake Texas Facility is expected in mid-2028.
- Subject to ongoing review, the expansion strategy is expected to progress to a Feasibility Study at the appropriate time.
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