Rare earths group MP Materials is partnering with the US military and Saudi Arabia’s state mining company to build a processing facility in the Gulf kingdom. 

MP, which struck a lucrative deal with Washington this year, said on Wednesday it has entered a partnership with the US defence department and Saudi state-backed mining company Maaden. The groups plan to develop a rare earths refinery that will process raw materials sourced from Saudi Arabia and other regions, and supply US and Saudi manufacturing and defence industries.

The metals are crucial to the production of permanent magnets that are used in a broad swath of industries, from defence to energy and technology. But their production is dominated by China, and western nations are now racing to build out alternative supply chains.