Australia's Viridis Mining and Minerals has taken a significant step toward financing its Colossus rare earth project in Brazil by signing a binding long-term supply agreement with Belgium's Solvay. The deal, announced today, covers mixed rare earth carbonate and spans seven elements, including neodymium and praseodymium — key inputs for the powerful magnets used in electric vehicles, wind turbines, and electronics.
Under the terms, Viridis will supply Solvay from first production, targeted for 2028, through December 2034. The contract includes minimum take-or-pay volumes equal to almost 64% of forecast production of its main magnet rare earths over the six-year window, including ramp-up. It also sets contractual price floors, guaranteeing a minimum $915 million in revenue.
Why the offtake matters for financing
For early-stage miners, the hardest step is often funding construction before any cash starts flowing. By locking in a buyer for a large slice of output and setting price floors, Viridis is reducing two risks banks focus on: whether the product sells and what it sells for in a weak market.
"This is really a project-finance signal," said a mining analyst who tracks rare earths. "Lenders can model cash coming in with less guesswork, which can lower the extra interest they charge for risk and make a financing close more achievable."
Viridis says it is working on "advanced senior debt financing" — essentially borrowing from banks at the project level. With nearly two-thirds of key magnet rare earth volumes effectively pre-committed, lenders may not demand as large a risk premium as they would for an uncontracted project. That could increase the odds that Colossus reaches financing close in time for the 2028 first-production target.
Technology support and potential margin lift
Separately, Solvay will license technology and provide technical support to help Viridis produce more refined material in Brazil. If the plant performs as planned, that could lift margins by allowing Viridis to sell higher-value products rather than just raw concentrate.
The deal also underscores the growing strategic importance of rare earths, particularly magnet metals like neodymium and praseodymium, which are critical for the global energy transition. Brazil is emerging as a key supplier outside China, which dominates rare earth processing. Other miners in the region are also attracting attention — for instance, Sigma Lithium recently restarted its Brazil operations after a court protection process, highlighting both the opportunities and challenges of mining in the country.
For everyday investors, the Viridis-Solvay deal is less about near-term earnings and more about de-risking a project that could eventually supply the growing demand for electric vehicle magnets. It also reflects a broader trend of Western companies seeking to secure supply chains for critical minerals, a theme that has been supported by initiatives like the World Bank's IFC fast-tracking $100 million into African and Brazilian mines.
What it means for investors
For those watching the rare earth sector, the key takeaway is that Viridis has reduced two major uncertainties: market access and price risk. The take-or-pay structure means Solvay is committed to buying the material even if prices fall, providing a revenue floor. The price floors further protect against downside.
However, the deal does not guarantee that Colossus will be built on time or on budget. Construction of mining projects often faces delays, cost overruns, and technical hurdles. The 2028 target is ambitious, and the project still needs to secure full financing and obtain all necessary permits.
Investors should also note that the $915 million minimum revenue is based on price floors and take-or-pay volumes, not a guaranteed profit. Actual revenue could be higher if prices rise, but costs and capital expenditures will also need to be covered.
For those interested in the broader Brazilian mining landscape, the country has been a focal point for both opportunities and risks. Brazil's markets have slid recently as fiscal plans remain vague, and currency movements can affect project economics. Still, the country's mineral wealth continues to attract international investment.
In the near term, watch for Viridis to announce progress on its senior debt financing. A successful close would be a strong signal that the project is on track. For now, the Solvay deal provides a solid foundation for that next step.
