Energy Fuels (UUUU) said Monday it has signed a memorandum of understanding with South Korea-based Posco International to form a new rare earth elements supply chain.

Financial terms were not disclosed.

The new supply chain will be for electric vehicles and hybrid EV drivetrains for US, European Union, Japanese, and South Korean auto manufacturers, the company added.

Energy Fuels' US-processed rare earth elements oxide could also be used in automobiles in the US and Europe as early as this year depending upon successful completion of the supply chain.

Energy Fuels' initial samples of neodymium-praseodymium, or NdPr, oxide have already fulfilled Posco's applicable requirements, it said, adding that it will provide a scale sample of NdPr oxide to Posco, which will be processed into NdPr metal, alloy and finished permanent rare earth elements magnets.

The companies also plan to discuss the potential for Energy Fuels to offer US-manufactured rare earth elements oxides to Posco in the future, Energy Fuels said.

Shares of the company were up 1.2% in recent Monday premarket activity.

Price: 4.18, Change: +0.05, Percent Change: +1.21