USA Rare Earth Inc. (NASDAQ: USAR) received a $14.2 million grant from the Texas Semiconductor Innovation Fund to develop its Round Top Mountain heavy rare earth project in Hudspeth County, Texas, according to a company statement.

The project is expected to create approximately 260 jobs and represents more than $1.4 billion in capital investment in West Texas. The Round Top Mountain deposit contains an estimated one billion tons of material and 15 of the 17 rare earth elements.

"This Texas Semiconductor Innovation Fund award reinforces what we have known from the start: Texas is where America's rare earth independence begins," said Barbara Humpton, chief executive officer of USA Rare Earth.

The Texas Semiconductor Innovation Fund was established under the Texas CHIPS Act, signed into law by Governor Greg Abbott in 2023. The fund aims to advance the state's leadership in semiconductor research, design, and manufacturing.

"This Texas-sized investment by USA Rare Earth in Hudspeth County will create good-paying jobs in West Texas and reduce reliance on foreign supply chains for critical rare earth minerals," said Governor Abbott.

USA Rare Earth operates facilities across multiple countries, including a rare earth permanent magnet manufacturing facility in Stillwater, Oklahoma, and Less Common Metals in Cheshire, United Kingdom. The company has entered into agreements to acquire interests in Carester, a rare earth processing company, and Serra Verde Group, owner of the Pela Ema rare earth mine in Brazil.

The Round Top Mountain project is part of USA Rare Earth's strategy to build an integrated value chain from mining to magnet manufacturing for customers in defense, aerospace, semiconductor, and other technology sectors.