Stonegate Capital Partners Initiates Coverage on Pensana PLC, Highlighting Strategic Position in Western Rare Earth Supply Chain

Stonegate Capital Partners has initiated coverage on Pensana PLC (LSE: PRE), highlighting the company's strategic position as one of the few developers outside China pursuing a complete mine-to-magnet model that captures value across the entire rare earth supply chain. Unlike traditional dig-and-ship approaches, Pensana is advancing a U.S.-facing downstream strategy that directly supports Western supply chain security objectives. The company's memorandum of understanding with ReElement Technologies provides a direct pathway for Longonjo feedstock to be refined and separated in the United States, creating a direct link between production and magnet manufacturing.

Pensana stands out as one of the rare earth projects outside China that has successfully secured construction financing, having raised $268 million from the Angolan Sovereign Wealth Fund (FSDEA), the African Finance Corporation, and Absa Bank. This places the Longonjo project among the very limited number of fully funded rare earth mines currently in construction worldwide. With a modest Stage 1 capital expenditure of $217 million, Pensana benefits from low capital intensity supported by existing Lobito Corridor rail and hydroelectric infrastructure, while recent equity placements have further strengthened liquidity to support ongoing operations.

The significance of Pensana's development extends beyond financial metrics to critical supply chain security concerns. Neodymium-praseodymium (NdPr) is indispensable for permanent magnets used in electric vehicles, offshore wind turbines, robotics, drones, and defense technologies. Demand growth remains robust, with electric vehicle sales projected to exceed 40 million annually by 2030 and offshore wind capacity expected to increase more than sevenfold by 2050. Given that rare earths underpin over $3 trillion in industrial applications, Western governments are increasingly prioritizing secure supply chains independent of Chinese dominance.

The Longonjo project in Angola represents one of the highest-ranked undeveloped NdPr deposits globally, with Stage 1 production expected to deliver approximately 5% of global NdPr supply. Construction is progressing on schedule with contractors mobilized on site, supported by a 20-year mine life. Additionally, Pensana controls the Coola license and Sulima West prospect, where drilling has identified strong mineralization and metallurgical testing confirms potential as supplemental feedstock. The Coola project, similar in scale to Longonjo, provides optionality for mine-life extension, grade optimization, and future expansion, reinforcing Pensana's ability to scale production and maintain long-term relevance in the supply chain.

Looking forward, Pensana's investment case rests on three key pillars: successful delivery of Longonjo as one of the lowest-capital-intensity NdPr projects globally, expansion through Coola and Sulima West to extend mine life and resource scale, and strategic alignment with U.S. and allied downstream strategies that reduce reliance on China's near-total dominance in rare earth refining. With production scheduled ahead of the U.S. Department of Defense's 2027 China-free supply chain target, Pensana is strategically positioned to emerge as a cornerstone Western supplier in the global magnet metals industry. The company's board is also evaluating a potential Nasdaq uplisting and has proposed a share consolidation to meet U.S. listing thresholds, which could broaden institutional access and improve trading liquidity over time.