Rare earths company REalloys receives Pentagon funding

March 2 (Reuters) - Rare earths company REalloys has been awarded a U.S. Department of Defense contract worth ‌up to $1.7 million to fund design of a ‌processing facility for metals used to make magnets for weapons and ​electronics, it said on Monday.

The Ohio-based company received the contract from the Defense Logistics Agency and aims to process up to 300 metric tons per year of the heavy ‌rare earths samarium and ⁠gadolinium into metal form, in what would make it one of the largest U.S. sources ⁠of those metals.

Rare earths must be turned into metals before they can be used to make magnets.

China has imposed ​export restrictions ​on rare earths and ​other critical minerals.

The contract, ‌which has two phases over 24 months, is an initial vote of confidence in REalloy's technology from the DLA, which buys a range of goods for the U.S. military.

REalloys, which last week began trading on Nasdaq after merging ‌with Blackboxstocks, will be required to ​develop engineering schematics for a ​modular version of the ​facility.

The company is also developing a rare ‌earths mine in Saskatchewan and ​has a processing ​agreement with the Saskatchewan Research Council, the Canadian province's technology innovation unit.

President Donald Trump has ordered the ​Department of Defense ‌to rename itself the Department of War, a ​change that will require action by Congress.

(Reporting by ​Ernest ScheyderEditing by David Goodman)