The U.S. Department of Defense (DoD) says that it's loaning $150 million to rare earth mine operator MP Materials, for upgrades to the company's Mountain Pass, California, processing facility.
According to an August 10 release from the DoD, the money will be used to add rare earth separation capabilities to the California facility, which is the only operational rare earth mine in the U.S. The funds will come from subsidies for critical mineral production set aside by President Donald Trump's One Big Beautiful Bill Act.
"Through this loan, we are taking decisive action to restore our domestic critical minerals supply chain, revive our industrial base, and rebuild our military," said Emil Michael, the Under Secretary of Defense for Research and Engineering.
This comes after the DoD agreed to buy $400 million worth of preferred stock in MP Materials in mid-July. The Pentagon uses magnets made from rare earth elements in systems for missiles, drones, smart bombs, fighter jets and submarines. In the interest of national security, both the Biden and Trump administrations made it a priority to reduce the United States' reliance on China for rare earth minerals, with China accounting for 70% of rare earth imports into the U.S. between 2020 and 2023.
