Australian company Ionic Rare Earths (IonicRE) has announced a major milestone with the Ugandan Directorate of Geological Survey and Mines (DGSM) having approved its large-scale mining licence application for the Makuutu Rare Earths project.

The ASX-listed firm said in an update that the approval to grant the mining licence follows the gazetting of the updated Mining and Minerals (Licencing) Regulations 2023 in the East African nation that provides a clear framework for mineral development.

The approval paves the way for the formal issuance of the licence once the first annual fees have been paid and land access has been verified by the Ugandan department.

Authorities in Uganda are showing strong support for the project, with the Minister for Energy and Mineral Development Ruth Nankabirwa Ssentamu praising it at the Africa Down Under Mining Conference in early September.

The Makuutu project is being developed by Rwenzori Rare Metals Limited (RRM), a Ugandan private company which owns 100% of the project. IonicRE controls a 60 % stake in RRM and maintains a first right over the remaining 40% of the project.

“We are pleased with the announcement today that the DGSM has officially approved for granting the large-scale Mining License TN03834 over RL 1693, which now completes all regulatory approvals on the award of the mining licence for the Makuutu Heavy Rare Earth project,” said Tim Harrison, Ionic Rare Earths managing director.

He added the development is a critical step in the mining, refining and recycling of heavy rare earths critical for the energy transition, advanced manufacturing and defence.

“This announcement reinforces the Makuutu project as one of the world’s largest and most advanced development-ready heavy rare earth element assets, and we look forward to progressing the next steps and commissioning our demonstration plant at Makuutu,” he noted.

Makuutu comprises six licences covering approximately 298 km2 and is located some 120 km east of the capital city of Kampala, in eastern Uganda.

Progress of the project puts Uganda on course to benefit from the minerals with the East Africa nation expected to rake in an estimated gross royalty payment of $199mn plus corporate tax contributions of $438mn over the stage 1 development of the project.