Molycorp and Molibdenos y Metales S.A. (Molymet) announced an agreement in early February 2011 whereby Molymet will invest $390 million in Molycorp in exchange for 12.5 million shares of Molycorp common stock, representing a 13% interest in the company. Molymet is headquartered in Santiago, Chile, and is the world’s leading processor of molybdenum and rhenium.

The company’s primary business is processing molybdenum concentrates to produce products and byproducts that include molybdenum oxide, ferromolybdenum, and rhenium. The company has plants in Chile, Mexico, Belgium, Germany and China, and commercial offices in England, China, the United States, Brazil and Chile. John Graell, Molymet’s executive chairman and CEO, is expected to serve on Molycorp’s board.

Molycorp is the only U.S-based company that is fully integrated across the rare earth mine-to-magnets supply chain. Proceeds from the Molymet investment will be retained by Molycorp for general corporate purposes.

Later in February, Molycorp reported it had begun sequential start-up of the new Project Phoenix rare earth manufacturing facility at its Mountain Pass, California, operations and confirmed that the Mountain Pass operations remain on track to achieve their planned Phase 1 production rate of 19,050 mt/y of rare earth oxide equivalent by the end of the third quarter of 2012. The company’s achievement of targeted Phase 1 production will come three months ahead of the original December 31, 2012, deadline that was set when the project was launched in 2010.