Rare earths explorer Arafura Resources is seeking to raise about $74 million to advance its Nolans project in the Northern Territory.

The company said in a statement after the Australian share market closed on Tuesday that it would offer about 122.7 million new shares at 60 cents per share through a rights issue.

Shareholders will have the right to acquire one new ordinary share for every three shares held.

The offer price is lower than Arafura's closing price on Tuesday at 62.5 cents, down four cents, or 6.02 per cent from Monday.

Proceeds from the raising will be used to bring the Nolans project to the bankable feasibility stage (BFS).

"We ... are now in the period of significant expenditure and commitements as we advance the BFS," chief executive Steve Ward said.

"We are now seeking additional funds to maintain the momentum of our current extensive programs."