Office of Strategic Capital signs $400 million conditional loan commitment with Sunrise Energy Metals Limited to expand scandium mining

The Department of War’s Office of Strategic Capital (OSC) has issued a $400 million conditional loan commitment to Sunrise Energy Metals Limited to expand the company’s scandium operations.

Sunrise, an Australian publicly listed company (ASX: SRL), owns the Syerston Scandium Project in New South Wales. Scandium occurs in low concentrations in the Earth’s crust and is currently harvested as a byproduct of other industrial and resource extraction processes. No primary mine-source scandium supply exists globally, and foreign competitors dominate the supply side, accounting for approximately 80% of global mining production and nearly 100% of scandium processing.

OSC said the financing, paired with private capital, will support development of a full scandium value chain, starting with primary mining at Syerston, which the company says contains a high-grade deposit. Sunrise also plans to build metallization and additive layer manufacturing capabilities to align the chain from mine to finished product. The arrangement includes a right of first offer for the Department on Sunrise’s output, and the scandium produced would support the demand of U.S. companies, including defense industrial base firms.

“Under the leadership of President Donald J. Trump, securing our critical minerals supply chain is a top national security priority. The contemplated Sunrise transaction marks a significant step in establishing supply chain resiliency for an increasingly critical mineral. This nearly $1 billion deal, bringing together public and private capital, would help address foreign dependencies in scandium supply and facilitate scandium’s use in critical defense and commercial applications,” said David A. Lorch, Director of the Office of Strategic Capital and Senior Advisor to Deputy Secretary of War Steve Feinberg.

OSC said the initiative advances efforts to secure a resilient, domestic supply chain for rare earths, and that Sunrise’s production will directly support warfighting capabilities in aerospace and defense, as well as sectors such as data centers, semiconductors, and automotive.

“This commitment is an example of the strategic financing OSC can provide,” said Asad Akram, Managing Director and Co-Head of Critical Minerals at OSC. “Sunrise’s scandium deposit will support strategic sectors in both national and economic security, with the capability to secure and expand both compute capacity and enhanced capabilities of modern fighter aircraft.”

“This conditional loan commitment is a decisive step toward creating a U.S.-aligned scandium value chain, ensuring our warfighters and manufacturers no longer depend on adversaries. We are attracting meaningful private capital investment into the front lines of our industrial base,” said Peter B. Zuckerman, Senior Managing Director at OSC. “The Sunrise commitment is just the first step in our effort to strengthen the scandium supply chain as OSC is conducting active due diligence on additional opportunities.”

“By backing Sunrise, we would be engineering a complete, allied mine-to-metal supply chain,” said John Gallagher, Co-Head of Critical Minerals at OSC. “Providing the capital to extract scandium from a primary mine and connecting it directly to onshore U.S. metallization ensures that the materials required for the future success of commercial and defense industries remain under our sovereign control.”

“Secretary Hegseth and Deputy Secretary Feinberg are mobilizing the Department of War’s resources to secure our critical mineral supply chain,” said Emil Michael, Under Secretary of War for Research and Engineering. “Congress provided the necessary resources, and OSC is aggressively executing that mandate to deliver for the American warfighter.”

The commitment is contingent on Sunrise meeting additional requirements before financial close, including financial, legal, technical, and other conditions.

OSC said that in FY 2026 it has committed more than $8.4 billion in debt financing and mobilized over $17.8 billion in total capital from public and private sources to support the American industrial base.