On 18 September 2026, Arafura Rare Earths Limited (ASX:ARU) released an ASX announcement titled Arafura Extends Binding Offtake Agreement. The company said its wholly owned subsidiary, Arafura Nolans Project Pty Ltd, has executed an extension of an existing binding offtake agreement with a global wind turbine original equipment manufacturer for up to 500 tonnes per annum of neodymium-praseodymium (NdPr) oxide equivalent.

What the extended agreement covers

The announcement describes the counterparty as a company in the renewable energy sector involved in the design, manufacturing, installation and maintenance of wind turbines. Deliveries are intended to align with the Nolans project schedule.

Key terms listed in the release are an annual contract Volume of 500 tonnes per annum of NdPr oxide, with optionality for both parties, while retaining appropriate offtake volumes to satisfy export Credit agency (ECA) required volumes. The period is five years, with potential extension up to eight years.

How pricing is set

Pricing is in US dollars and is based on a global seaborne pricing index, such as the recently established Benchmark Minerals Intelligence indices or the S&P Global Platts North America pricing index. The announcement states that pricing is linked to an independent and transparent index, but it does not give a price, a discount or a total contract value.

The agreement is subject to conditions precedent described as customary for arrangements of this nature. The release did not list those conditions.

A change in how counterparties are disclosed

Arafura said it remains in offtake discussions with a number of parties and intends to ensure its disclosures do not compromise commercially sensitive information or prejudice its negotiating position. As a result, to the extent permitted by ASX guidance, it will no longer disclose the identity of offtake counterparties unless the identity is itself material.

For the purposes of ASX Compliance Update 02/25, the company confirmed that it does not consider the identity of the partner to be information that would have a material effect on its securities, that the announcement contains all material information on the agreement’s impact, and that it has described the partner sufficiently, including its standing and creditworthiness.

Sector backdrop

Neodymium and praseodymium are used in permanent magnets, including those in some wind turbine generators. Offtake agreements are a common step for rare earth developers because lenders and export credit agencies often look for contracted sales before committing project finance.

Rare earth pricing has historically been less transparent than that of larger commodities, and new index providers have emerged to publish benchmark prices. Linking contract prices to an index is one way parties address that limitation.

Risks shareholders should weigh

The agreement is conditional, and the announcement does not say when the conditions precedent are expected to be satisfied. The terms provide optionality for both parties, so the volumes actually delivered may differ from the 500 tonnes per annum headline figure.

Deliveries are aligned with the Nolans project schedule, so the contract depends on the project being built and operating. The release does not discuss project funding, construction timing or production start dates.

Because the counterparty is no longer named, shareholders have less information with which to assess the customer. Arafura has described the partner only in general terms. Index-linked pricing means Revenue will move with market prices, and the volume stated may be subject to the requirements of export credit agencies.

What’s next

Arafura said it remains in offtake discussions with a number of parties. Shareholders may wish to watch for further offtake announcements, the satisfaction of conditions precedent on this agreement, and project financing and construction updates for Nolans.