Arafura Rare Earths said on Monday it had secured up to $300 million in debt financing from Export Development Canada (EDC) for its Nolans project in Australia’s Northern Territory.

The funding comes after Australia earlier this year pledged up to A$840 million ($556.42 million), as Western nations diversify the global supply chain for rare earths after Covid-related snarls highlighted China-linked supply risks. China produces more than 80% of the world’s rare earths.

Shares of the rare earths explorer climbed as much as 7.7% by 0115 GMT, compared to a 0.6% rise in the broader benchmark index.

The Nolans project is slated to be the country’s third rare earths processing plant after Lynas Rare Earths’ Kalgoorlie operations and Iluka Resources’ Eneabba heavy rare earths plant, which is under development.

Arafura said it had received conditional approval for 68% of the targeted $775 million senior debt funding for the project, bringing it closer to a final investment decision.

In November 2022, Arafura estimated capital costs and contingency for the Nolans project at about A$1.59 billion, according to the company’s 2023 annual report.

The company, whose largest shareholder is Australia’s richest person Gina Rinehart, already has supply agreements with Hyundai Motor, Kia Corp and Siemens Gamesa Renewable Energy. It also has a provisional agreement with General Electric.

The funding arrangement between Arafura and EDC was facilitated by a unit of General Electric, the Australian company said.

Arafura is working with a group of foreign and domestic commercial banks to seek the remaining funding for the project.