Swedish state-owned mining company LKAB has begun hot commissioning at its critical-minerals demonstration plant in Luleå, northern Sweden, to test processing of phosphorus and all 17 rare-earth elements from iron-ore mining by-products. The facility is intended to test whether materials from established mining operations can be processed into products for European supply chains.
The plant represents an investment of approximately SEK 800 million (€73 million). LKAB said it was completed on schedule and within budget.
Engineers are testing equipment, validating processing systems and optimising mineral recovery. Regular demonstration-scale operations are expected to begin in spring 2027.
Testing mineral recovery
The demonstration plant will test technologies to separate and process phosphorus and all 17 rare-earth elements from apatite-rich material associated with LKAB’s iron-ore operations in the Gällivare region. The programme is designed to assess recovery efficiency, material quality and processing performance, as well as whether equipment is suitable for larger industrial applications.
LKAB plans to recover phosphorus and rare-earth elements from apatite-containing streams associated with its operations at Malmberget. The processing route also envisages producing gypsum suitable for construction applications.
Phosphorus is an essential input for fertiliser production. Rare-earth elements are used in permanent magnets, electric vehicles, wind turbines, industrial machinery and advanced electronics.
LKAB’s approach seeks to recover valuable minerals from material historically treated as residual output from iron-ore production. The company says this could improve resource efficiency and reduce waste by extracting multiple products from existing mining streams.
Commercial development remains undecided
The demonstration programme will generate data on processing performance and mineral recovery before LKAB assesses the route for larger-scale use. The company’s longer-term plans involve linking apatite extraction and processing in Gällivare with downstream refining and product recovery in Luleå.
LKAB has not made a final investment decision on the full-scale industrial processing complex. The demonstration plant is not commercial rare-earth production, and the company has disclosed neither binding sales agreements nor a confirmed start date for a full-scale refinery.
The Luleå industrial park received an environmental permit in May 2026. A separate permit for operations and apatite processing in Gällivare was granted in June 2026 and has been appealed.
The appeal’s outcome, the plant’s technical performance and future financing requirements could influence the timetable for commercial development. Reliable recovery rates and product quality must be established before the processing route can be assessed for full-scale deployment.
European processing capacity
The project is part of LKAB’s strategy to establish an integrated European supply chain for critical minerals using resources already present in Sweden’s established mining industry. It is intended to advance European domestic processing capacity and reduce reliance on concentrated international supply chains.
Much of the world’s rare-earth separation and refining capacity remains outside Europe, particularly in China, despite significant European industrial demand. Dependence on external processing capacity is strategically important for European manufacturers of renewable-energy equipment, electric vehicles, electrical machinery and defence-related technologies.
LKAB’s project could recover rare-earth resources from an established European mining operation rather than relying exclusively on new standalone deposits. Its phosphorus output could also support European fertiliser supply chains.
Successful demonstration could establish a route to producing multiple critical raw materials from the same industrial feedstock and provide a model for other European mining regions seeking greater value from existing operations. Hot commissioning marks the move from engineering and construction to practical industrial testing, as LKAB establishes stable processing conditions and gathers performance data for potential commercial-scale facilities.
