Arafura Resources (ASX: ARU) has moved another step closer to developing the Nolans rare earths project, contracting Lycopodium Limited (ASX: LYL), for the design and engineering studies for the Nolans mine and beneficiation plant in the Northern Territory.

The work is expected to be completed by the end of 2010.

Steve Ward, Arafura’s managing director and CEO, said “our successful capital raising earlier this year has enabled us to drive forward with our work programs to complete the Nolans Project."

"The Lycopodium contract is a key component of the work relating to the Nolans mine and beneficiation plant."

"This follows and builds on the mine optimisation and EIS-related work streams announced in March, and is further demonstration of our determination to bring Nolans into production in 2013,” he added.

Rare earths metals are essential components to products with significant growth potential in the markets associated with the electronics and technology industries, energy efficiency and greenhouse gas reduction.