Australian Rare Earths (ASX:AR3) received the initial installment of AU$750,000 as part of the AU$5 million grant under the Australian Government's International Partnerships in Critical Minerals Program, according to a Tuesday filing with the Australian bourse.

The proceeds will support the development of the Koppamurra project, located in South Australia and Victoria, with the remaining funds to be paid upon the submission of progress reports, the filing said.

Shares of the mining firm fell 3% in afternoon trade Tuesday.