The mine-to-magnet problem in American rare earths has never been only about mines — it is about the processing step in the middle, and for the two heaviest magnet metals that step barely exists outside China. On November 3, the U.S. Army put a piece of Utah desert on the table for it.
- The document: REalloys Inc. (NASDAQ: ALOY) and the U.S. Department of the Army have executed a term sheet — explicitly non-binding apart from customary provisions — setting out the principal terms for a potential Enhanced Use Lease (EUL) at Tooele Army Depot, Utah.
- The site: approximately 200 acres inside the existing defense installation. REalloys would develop, finance, build, operate and ultimately decommission the facility; the United States keeps title to the land.
- The metals: dysprosium (Dy) and terbium (Tb) — the heavy rare earths used in high-temperature permanent magnets for precision-guided munitions, electric motors, sonar and radar. Other rare earth elements could be added later by written agreement.
- The tenure on offer: an initial 50-year lease with one 25-year renewal option (subject to conditions including Army consent) — up to 75 years of potential operating tenure.
- The Army's position: a right of first offer to purchase product from the facility, subject to federal law and procurement rules — with no obligation to buy anything. Consideration would be annual base rent at fair market value from lease commencement, plus participation rent once commercial operations begin, at rates still to be agreed.
- How it got here: the Army selected REalloys on June 25, 2026 as the solicitation awardee for exclusive negotiations under its Strategic Capital Initiatives, the program that uses Enhanced Use Leases to place domestic critical-mineral processing on Army installations.
Why the Army is the landlord
The release is unusually direct about the vulnerability, in the words of Dr. Jeff Waksman, Principal Deputy Assistant Secretary of the Army for Installations, Energy and Environment: "Rare earth processing is a known national security vulnerability, with China specifically holding a near 100% global monopoly on dysprosium and terbium. Leveraging our legal authorities and land, the U.S. Army is able to help nurture and expedite the growth of critical minerals industrial base which equips and sustains America's Soldiers without putting any taxpayer dollars at risk."
REalloys is building what it calls a vertically integrated mine-to-magnet chain — upstream feedstock, midstream separation and metallization, downstream magnet manufacturing — and says it is advancing the rest of that platform in parallel, including its strategic relationship with the Saskatchewan Research Council. Tooele would be the U.S. processing anchor: a plant on federal land, inside a secured installation, under a lease structure the Army has used to pull private capital onto its depots.
The honesty box
A term sheet is not a lease, and a lease is not a plant. The document is non-binding, and the release states plainly that there can be no assurance a definitive EUL will be executed. Before one can be signed, the parties still have to agree the fair-market base rent and the participation-rent method, the Army has to accept REalloys' development plan, environmental reviews and permitting have to be completed, a foreign-ownership review has to clear, project financing has to be secured, REalloys' board has to approve, and Congressional notifications have to be made — and if the conditions are not satisfied or waived within 18 months, either party may terminate the term sheet. The release gives no plant capacity, throughput, feedstock source, capital cost or construction timeline, and the Army's right of first offer is not a purchase commitment. The "near 100% monopoly" figure is the Army official's characterization as quoted in the release.
What to watch
Negotiation of the definitive EUL and its rent terms; the environmental review path at Tooele; where REalloys says the plant's feedstock will come from; and whether financing is announced — the item that turns a framework on Army land into a buildable project.