Blackboxstocks Inc. (NASDAQ: BLBX) announced that its merger target, REalloys Inc., has entered into a partnership with the Saskatchewan Research Council (SRC) that will secure 80 % of the upgraded SRC Rare Earth Processing Facility’s annual output. The agreement includes a US$21 million investment from REalloys to expand the facility’s heavy‑rare‑earth (Dy and Tb) processing capacity by an estimated 300 % and its light‑rare‑earth (NdPr) capacity by 50 %.
The expanded SRC plant is slated to be fully operational in early 2027 and will produce up to 30 tonnes of dysprosium oxide, 15 tonnes of terbium oxide, and 400 tonnes per year of high‑purity neodymium‑praseodymium metal, with the NdPr output rising to 600 tonnes after expansion. The partnership establishes the first fully funded and permitted commercial‑scale heavy‑rare‑earth refining pathway in North America, meeting all Title 50 defense‑sourcing requirements and eliminating a Chinese or non‑allied nexus.
REalloys’ CEO, Lipi Sternheim, emphasized that the deal positions the company as the only fully integrated North‑American rare‑earth platform capable of delivering both light and heavy rare earths at commercial scale. “By aligning Canadian innovation with U.S. defense needs, we are strengthening the security of the Western world and building a scalable alternative to China’s dominance,” Sternheim said.
The partnership is a cornerstone of Blackboxstocks’ strategic pivot toward a vertically integrated rare‑earth and magnet materials business. Blackboxstocks has faced revenue declines and net losses in recent fiscal years, but the REalloys deal provides a new, high‑margin revenue stream that aligns with growing demand for clean‑energy and advanced‑technology applications. The 80 % offtake agreement gives REalloys a guaranteed customer base, while the US$21 million investment accelerates the facility’s expansion and positions the company to capture the U.S. defense market that will be restricted from sourcing rare earths from China, Russia, Iran, or North Korea starting January 1 2027.
The SRC facility has been operational for commercial‑scale rare‑earth production since July 2024 and is the first North‑American plant to integrate mining, processing, and metallization. The partnership will leverage SRC’s existing infrastructure and expertise, while REalloys brings its own mining assets, including the Hoidas Lake project in Saskatchewan, to create a seamless mine‑to‑magnet supply chain. This integrated model is expected to reduce costs, improve quality control, and accelerate time‑to‑market for high‑performance magnets used in electric vehicles, wind turbines, and defense systems.
Analysts noted that the partnership’s timing aligns with the U.S. Department of Defense’s new DFARS 252.225‑7052 regulation, which will prohibit the procurement of rare earths from non‑allied countries. The 80 % offtake agreement therefore positions REalloys to capture a significant share of the defense‑related demand that is expected to grow as the U.S. seeks to secure critical materials supply chains.
The deal also signals confidence in the Canadian rare‑earth sector, with Saskatchewan’s government reaffirming its commitment to attracting private‑sector investment and strengthening North‑American supply‑chain independence. The partnership is expected to create jobs, stimulate local economies, and enhance the province’s reputation as a global rare‑earth hub.
Overall, the partnership represents a strategic milestone for Blackboxstocks and REalloys, providing a secure, high‑margin supply chain that meets U.S. defense requirements and positions the company to capitalize on the growing demand for rare earths in clean‑energy and advanced‑technology markets.
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