Vancouver-based Canada Rare Earth will acquire a rare earth refinery in southeast Asia.

The specific refinery and location were not revealed.

Canada Rare Earth is building a supply chain connecting rare earths sources, refineries, and international customers.

"The refinery is based on technology and processes already deployed and in production at a dozen other rare earth processing plants and is capable of producing approximately 3,000 metric tons of the complete spectrum of rare earth oxides," chief operating executive Peter Shearing said.

Being able to produce neodymium, praseodymium, dysprosium, and terbium is critical to supplying the electric vehicle market, he said.

The company entered into an agreement in principle, with the final sale subject to a definitive agreement and financing.

Movement towards a definitive agreement is "progressing rapidly", chief executive Tracy Moore said.

"Price will contemplate two permitting scenarios - operating permit received and pending," Moore said.

Canada Rare Earth has been involved with the refinery for several years, she added.

The company anticipates it will be able to supply the needed rare earth feedstock to meet the refinery's current capacity. Canada Rare Earth is also willing to support refinery capacity expansion in the future, Shearing said.