Namibia Critical Metals has extended the timetable for finalising the transfer of a 50% interest in its Lofdal heavy rare earth project to Japanese investors, with shareholder agreements and regulatory approvals now expected to take up to another 30 days to complete.
The Canadian-listed company said on Tuesday that it was continuing discussions with the Japan Organization for Metals and Energy Security (JOGMEC) and Toyota Tsusho Corporation to finalise the shareholder arrangements required to implement the project’s new ownership structure.
The announcement follows earlier updates issued on 30 July and 31 August 2026 concerning the proposed restructuring of ownership in Lofdal, one of Namibia’s most advanced heavy rare earth projects.
Although the Japanese partners have already met the expenditure requirements to earn a 50% interest in the project, the transfer has not yet been completed because the definitive shareholder arrangements and applicable regulatory consents remain outstanding.
“The Company expects the shareholder and applicable regulatory consent process to continue up to another 30 days,” Namibia Critical Metals said in its latest announcement.
The transaction involves the issue of a 50% interest to TJNREC, the entity designated to hold the Japanese partners’ stake under the new joint venture structure.
JOGMEC and Toyota Tsusho have already fulfilled the C$23 million expenditure requirement under the original earn-in agreement, which allows the Japanese partners to acquire half of the project through staged exploration and development expenditure.
Under the agreement, JOGMEC was required to spend C$3 million during the first phase and another C$7 million during the second phase to earn an initial 40% interest.
A further C$13 million in expenditure was required during the third phase to earn an additional 10%, bringing the Japanese partners’ total earned interest to 50%.
The completion of these spending commitments means that the remaining steps concern the formal implementation of the ownership arrangements rather than further expenditure needed to qualify for the stake.
Namibia Critical Metals currently holds a 95% interest in Lofdal, while the remaining 5% is held for the benefit of historically disadvantaged Namibians.
The company’s announcement does not specify how the remaining ownership will be allocated among the participating entities after completion of the new joint venture arrangements, beyond confirming the proposed 50% interest for TJNREC.
The existing agreement also contains provisions governing future financing and ownership dilution as the project moves towards development.
JOGMEC has an option to purchase an additional 1% interest for C$5 million and holds a first right of refusal to fully finance the project through to commercial production.
The Japanese agency also has the right to purchase all production from the project at market prices, positioning Lofdal as a potential future source of heavy rare earth materials for Japanese industry.
Namibia Critical Metals has dilution protection under the agreement, allowing it to maintain a minimum interest of 21% if it makes a C$5 million payment to JOGMEC for that protection.
The company may also elect to participate in future project financing after a final investment decision by contributing its proportional share of the required funding, potentially maintaining a larger ownership interest.
However, failure to meet future funding commitments could trigger accelerated dilution, with the agreement providing for conversion of the company’s interest into a 1% net smelter return royalty if its ownership falls below 10% under the specified circumstances.
The 5% carried working interest held for historically disadvantaged Namibians is protected from dilution under the conditions of the project’s mining licence.
Lofdal is regarded as an important potential source of dysprosium, terbium and yttrium, rare earth elements used in electric vehicles, renewable energy technologies and advanced defence applications.
Dysprosium and terbium are particularly important in the production of high-performance permanent magnets, which are used in electric motors and other technologies requiring strong magnetic performance at elevated temperatures.
The project is being advanced through the partnership with JOGMEC, a Japanese government agency responsible for supporting secure resource supplies, and Toyota Tsusho, the trading and business development arm of the Toyota Group.
The partnership forms part of Japan’s efforts to diversify its access to critical minerals and reduce supply-chain vulnerabilities in industries dependent on rare earth materials.
JOGMEC has previously supported major international rare earth developments, including financing arrangements with Australian producer Lynas, demonstrating Japan’s willingness to commit substantial capital to projects capable of supplying its industrial sector.
For Namibia, the Lofdal partnership provides a potential route to international financing, technical development and access to established markets for heavy rare earth products.
However, the latest announcement does not provide a revised construction timetable, a final investment decision or details of additional financing commitments beyond the completed earn-in expenditure.
The immediate outstanding matter remains the conclusion of shareholder arrangements and regulatory approvals required to give effect to the Japanese partners’ 50% ownership.
Namibia Critical Metals has indicated that this process could continue for another month, extending the completion timetable into November 2026.
