Neo Performance Materials, a Canadian rare-earths company, plans an expansion in eastern Estonia that it puts at about EUR 400 million in total, Invest in Estonia reports, citing the Estonian Ministry of Foreign Affairs. The European Commission has picked the project for up to EUR 126 million of support from the EU Innovation Fund.
The plan covers three parts: a larger permanent magnet factory in Narva, a modernised Silmet separation plant in Sillamäe and new capacity to turn separated rare-earth oxides into metals. Neo expects the yearly nameplate capacity of the Narva plant to grow from about 2,000 to approximately 5,000 metric tonnes of magnets, and the wider project could add up to 3,000 tonnes a year, one third of it meant for offshore wind farms in the EU. The company also plans to use digital twins and artificial intelligence across the production chain.
Foreign Minister Margus Tsahkna said: It will help create new jobs in Estonia, ensure more secure supplies for European industry and reduce dependence on imports of critical raw materials
. He added that strategic industries must free themselves from supplies from Russia and that NPM Silmet is expected to find alternative raw material sources quickly.
The project is not final yet. According to the article, the grant agreement is to be signed by 23 March 2027, Neo expects the work to take two to three years, and the project still depends on final investment decisions and the reviews of the grant procedure.
Source: Invest in Estonia, . The text above is our own summary; the words in quotation marks are the source's.
What this means for an Estonian entrepreneur
A project of this size in Narva and Sillamäe will need local suppliers, contractors and service companies over two to three years. A foreign group that wants to take part in such supply chains usually needs an Estonian company of its own, and setting up a holding or subsidiary structure early leaves time for contracts, bank accounts and permits.
We prepare the formation of an Estonian holding or subsidiary company for a foreign group entering Estonia. Estonian holding company formation and restructuring
New tools change what a company needs and what it pays for: the Business Navigator helps you review your company's needs and optimise its costs.