Toyota Tsusho Corp (TTC), the trading unit of Japanese auto giant Toyota Motor Corp, Asia's largest automaker, yesterday announced plans of forming a joint venture with Matamec Explorations Inc for developing the Canadian miner's Kipawa rare earth mine.
Toyota said it has signed a non-binding memorandum of understanding (MoU) with the Montreal-based mining company to ''fast track the development'' of Matamec's Kipawa heavy rare earths deposit, and buy all the output from the mine.
The agreement between the two companies helps TTC secure its supply of heavy rare earth elements required for the production of hybrid and electric vehicles, Matamec said in a statement.
The two companies will form a joint venture only for the Kipawa Deposit, in which Toyota would hold a 49-per cent stake, while Matamec would hold the remaining 51 per cent.
The costs of the feasibility study will be borne based on Toyota's 49-per cent stake and Matamec's average market capitalisation during the 90 day period ending 30 November 2011.
André Gauthier, president of Matamec, said, ''The company has discussed and has negotiated with many end-users since January 2009. After nearly two years, TTC and Matamec have reached a way to develop the potential of the Kipawa Heavy Rare Earths Deposit in a manner that meets the needs of both companies.''