By Charles Pitts
Lockheed Martin has signed a non-binding memorandum of understanding with NioCorp Developments for the potential purchase of up to 15 metric tons of scandium annually over 10 years, as the U.S. defense contractor works to secure supplies of critical minerals for aircraft alloys and military systems.
The proposed scandium supply would come from NioCorp’s planned Elk Creek Critical Minerals Project in Nebraska. The material could be delivered as scandium oxide or aluminum-scandium master alloy for use in aerospace and defense applications, including components under development with Lockheed Martin’s Skunk Works division.
Separately, Lockheed Martin is in long-term discussions with Teck Resources and 5N Plus to source germanium for infrared sensors and other military equipment, according to people familiar with the negotiations cited by Reuters. Those talks have continued for more than a year, with pricing and contract duration among the issues still being negotiated.
The agreements and discussions show how defense contractors are moving beyond broad policy commitments to secure specific volumes of specialty metals from U.S. and allied supply chains. They also underline the gap between government-supported mineral development and commercial supply: the scandium MOU is not binding, while the germanium negotiations have not yet produced disclosed contract terms.
Scandium MOU links Lockheed to planned Nebraska production
NioCorp said the MOU covers potential purchases of up to 15 metric tons of scandium oxide per year for 10 years. The material could also be supplied in the form of aluminum-scandium alloys, depending on the requirements of Lockheed Martin’s programs.
The company plans to produce approximately 100 metric tons of scandium oxide annually once the Elk Creek project is financed, built and commissioned. If the full volume under the MOU were delivered, Lockheed Martin would account for roughly 15% of NioCorp’s planned annual scandium oxide output.
NioCorp’s Elk Creek project is located in Johnson County, southeast Nebraska. The proposed operation is designed to produce niobium, scandium and titanium, while the company is also evaluating the potential recovery of several rare earth elements.
The project’s June 2022 feasibility study outlined a 38-year mine life and a pre-tax net present value of $2.8 billion. Those figures remain dependent on financing, permitting, construction and operating performance. Scandium production is therefore a development-stage target rather than an existing source of commercial supply.
NioCorp and Lockheed Martin have already been working together on scandium-based aluminum alloy components for fighter aircraft. That joint development program received a $10 million Title III Defense Production Act award through NioCorp’s Elk Creek subsidiary.
The partnership is intended to connect mineral production with downstream alloy manufacturing. That distinction matters because mining scandium oxide alone would not complete the defense supply chain. The material must also be refined, alloyed, qualified and incorporated into components that meet aerospace performance and certification requirements.
Materials technicians inspect alloy samples and precision equipment in a laboratory setting.
What the proposed scandium volume means
| Supply-chain element | Publicly disclosed detail | Current status |
|---|---|---|
| Potential Lockheed Martin purchase | Up to 15 metric tons per year | Covered by a non-binding MOU |
| Potential contract period | 10 years | Definitive terms not agreed |
| NioCorp planned Elk Creek output | Approximately 100 metric tons per year of scandium oxide | Dependent on financing and construction |
| Product form | Scandium oxide or aluminum-scandium master alloy | Final specification to be negotiated |
| Defense application | Aluminum-scandium alloy components | Joint development underway |
Scandium is added to aluminum to improve strength, corrosion resistance and weldability while supporting lightweight designs. Those properties have made aluminum-scandium alloys attractive for aerospace structures and other applications where weight, durability and performance are closely linked.
NioCorp currently produces a 4% aluminum-scandium master alloy in the United States using market-sourced scandium oxide. The company has said it intends to produce finished alloy ingots with scandium concentrations ranging from 0.2% to 0.8% for commercial and defense customers.
The supply MOU could provide a potential anchor customer for the project, but it does not remove the central development risks. NioCorp must still secure substantial capital, complete its technical work, build the mine and processing facilities, and establish a reliable commercial-scale production system.
NioCorp’s announcement states that both parties agreed to negotiate a definitive agreement in good faith. It also cautions that there is no assurance a final agreement will be reached or that its eventual terms will match the MOU.
Germanium talks target infrared and military electronics
Lockheed Martin’s parallel germanium discussions involve Teck Resources and 5N Plus, two companies with different positions in the supply chain.
Teck produces germanium-bearing zinc concentrates at its Red Dog operation in northwest Alaska. The concentrates are shipped to Teck’s Trail metallurgical complex in British Columbia, where germanium can be recovered as a byproduct of zinc processing. The Red Dog operation is one of the world’s largest zinc mines and is expected to operate through 2031 based on currently developed deposits.
Germanium is used in infrared optics, fiber-optic systems, semiconductors and other specialized technologies. In defense applications, the material can be used in infrared sensors and electro-optical systems supporting targeting, surveillance and night-vision capabilities.
Teck’s position gives Lockheed access to a North American mining and processing chain, although the material still moves across the U.S.-Canada border between the Red Dog mine and Trail. The company has also agreed to work with the Canadian government on expanding germanium processing capacity in British Columbia.
5N Plus is pursuing a different model based on recycling and downstream materials production. In January, the company said it had received an $18.1 million U.S. government grant to expand germanium recycling and refining at its St. George, Utah, facility.
The project is intended to recover germanium from industrial residues and mining by-products over a 48-month period. 5N Plus said the expansion could eventually allow the facility to process up to 20 metric tons of high-purity germanium annually, in addition to its current sources.
The company produces high-purity germanium wafers for infrared optics, night-vision systems, surveillance windows, electro-optical and infrared applications, and satellite solar cells. Its Utah operations therefore represent a more vertically integrated source for defense customers that require refined material and finished substrates rather than only mine output.
Price and term remain barriers
The germanium negotiations illustrate the commercial challenge facing North American critical-mineral projects. Government support can help expand capacity, but buyers and suppliers still need to agree on prices that justify production outside China while remaining workable for defense manufacturers.
Reuters reported that the Lockheed Martin discussions with Teck and 5N Plus have focused in part on pricing and contract length. No volumes or final terms have been disclosed.
That uncertainty is significant in a market where germanium is often recovered as a byproduct rather than produced from a standalone mine. Output can therefore depend on the economics and operating plans of the primary zinc or recycling businesses that generate the feedstock.
The supply chain is also technically specialized. Germanium must be separated from concentrates or secondary material, refined to high purity and converted into products suitable for optics, detectors or semiconductor applications. Each stage presents potential bottlenecks.
A broader defense supply-chain shift
The Lockheed Martin initiatives come amid pressure from the Trump administration for U.S. defense contractors to reduce exposure to Chinese-controlled critical-mineral supply chains.
China has imposed export restrictions on germanium and controls a large share of global supply. Scandium markets are smaller and less transparent, with production concentrated among a limited number of suppliers. In both cases, the concern is not simply the availability of ore but the availability of qualified, processed material at the point of use.
That is driving a shift toward supply agreements, government grants, domestic processing and allied production. The emerging model combines:
- U.S. mineral development, such as NioCorp’s planned Nebraska project.
- Allied mining and refining, including Teck’s Alaska-to-British Columbia chain.
- Recycling and advanced materials production, represented by 5N Plus in Utah.
- Defense-led qualification, through Lockheed Martin’s alloy and sensor programs.
For operators and investors, the key measure will be whether these initiatives move from announcements to binding contracts, financed projects and qualified products. Lockheed Martin’s scandium MOU provides a potential demand signal for NioCorp, but it is not yet bankable offtake. The germanium discussions similarly show strategic interest without confirming commercial volumes.
The developments nevertheless mark a clear change in how specialty metals are being sourced. Defense contractors are increasingly engaging directly with miners, refiners and materials companies to shape supply chains around specific military requirements. That could create new opportunities for projects capable of delivering not only mineral output, but also the processing and product qualification needed by advanced manufacturing.
For broader context, Skillings’ executive briefing on critical-minerals security and mining-sector consolidation examines how geopolitical risk is influencing investment, project development and supply-chain strategy across the mining industry.
