On Monday, shares of American Resources Corporation (AREC.US) rose sharply in pre-market trading, gaining over 37% to $5.31 at the time of writing. The surge follows an announcement by its subsidiary ReElement Technologies regarding a $1.4 billion joint financing agreement with the Office of Strategic Capital (OSC), a division of the U.S. Department of Defense. The funding aims to accelerate the development of a domestic rare earth permanent magnet supply chain in the U.S.

The investment will primarily support ReElement's collaboration with Vulcan Elements, focusing on establishing a comprehensive rare earth permanent magnet supply chain. This includes key processes such as rare earth element separation, metallization, and magnet manufacturing. According to the announcement, OSC will provide $620 million to Vulcan Elements and $80 million to ReElement Technologies, with matching private capital contributions to ensure equal financing.