Mining & Trade News

The Catholic Commission for Justice and Peace (CCJP) has called upon the Malawi Government and development partners to consider empowering Artisanal and Small-scale Miners (ASMs) in gemstone subsector in the country with knowledge and skills.

Programs Coordinator for Catholic Commission for Justice and Peace (CCJP) Tuntufye Simwimba told Mining & Trade Review that the call follows the knowledge gap that is there within the subsector especially to youth and women who have the interest of operating and those already in the subsector.    

Simwimba said: “Definitely, there is a gap. However, identification of gemstones especially the seven key gemstones; diamond, pearl, ruby, sapphire, emerald, oriental cats eye and alexandrite is a specialized field that can be learnt by anyone with sufficient interest.

“While focus should be on formal institutions, there should be a deliberate endeavor to enhance information and skills to supplement the demand of the sector.”

2ASMs should be empowered, regulated and given the right capacity. Youth and women led initiatives should also be empowered to undertake efforts in the field with micro-factories and knowledge.”

Simwimba further stressed the need to consider the gemstone subsector in response to the nation’s policy shift of Agriculture, Tourism and Mining (ATM).

He also reiterated the need for a stringent law to enhance that foreign companies do not take advantage of Malawi’s legal and policy inadequacies.

Simwimba said: “When the government identifies extractives as a key developmental area, policy, practice, strategy and law have to equally respond to that.”

“Commendable is that the Mines and Minerals Act has been amended, but there is more to be done.”

“There is a need to enhance capacity building and setting up of micro factories to enhance polishing and adding value of gemstones. The policy and practice direction in this regard seems inadequate”

“We should also understand that when policy identifies key areas of national development and extractives is one of them and this should be reflected in the national budget,” said Simwimba.

However, Simwimba bemoaned underfunding of the mining sector in general adding that this hinders national aspirations and the desire of developing the sector through value addition strategy.

In his remarks, one of the local ASMs in gemstones sector, Chikomeni Manda concurred with Simwimba on the knowledge gap citing that the country has few certified gemologists.

Manda said even though the country has few certified gemologists, there are some local miners and dealers with ground experience with knowledge and skills than graduate gemologists following years spent in the field.

He said: “Many people have to be trained for them to have ground experience because you can be a gemologist only conversant with theory without practical experience.”

“We have seen people calling themselves gemologist and some from outside the country but being sold low quality and plastics in the name of gemstones because they have no ground experience.”

“So, I also urge people with little experience to show interest to be trained at least in basic gemology.”

Manda further reached out to experienced gemologists to share the knowledge and skills to those showing interest and upcoming miners.

He said: “It is also appropriate that following the establishment of the gemstone buying initiative by the Malawi Government, institutions like universities, Export Development Fund (EDF), Center for Environmental Policy and Advocacy (CEPA) and others should consider offering short course trainings to miners and dealers.”

“If you have the capacity to conduct free trainings like we do, sometimes it is better to do so to those that cannot afford to pay.”    

The Ministry of Mining continues to formalize the gemstones subsector through formation of cooperatives and issuing of mining and gemstone buying licenses but it is yet to train the ASMs in sustainable mining and provide them with modern mining equipment.

The Ministry continues to face underfunding challenges making it unable to fulfill some of its obligations in the ASMs sector. 

Local firm Akatswiri Mineral Resources, which is prospecting for rare earth elements (REEs) at Chambe Basin in Mulanje Mountain, has urged Malawians to do away with any fears of environmental damage in Mulanje Mountain due to the project.

Akatswiri CEO Hilton Banda tells Mining & Trade Review in an interview that his company is pursuing a Sustainable Mining and Tourism approach, aiming at adopting open-pit mining with responsible rehabilitation practices to conserve the environment while extracting the REEs.

“The mining project will prioritize the protection of the environment and an aerial way will be used to transport the minerals from the plateau. This will reduce ground vibrations and also serve as a potential mine tourism attraction,” says Banda.

He also explains that the company is following all legal processes including the requirement to conduct an environmental and social impact assessment before a decision to conduct mining is made.

Currently, Akatswiri is only conducting exploration work and has now completed Phase 1 drilling programme whose samples have been sent to Australia for metallurgical analysis.

Banda says his company is working closely with the local community to preserve the environment and conduct Corporate Social Responsibility (CSR) projects in the area.

“Akatswiri has been engaging members of the local community in the area including at District Council level to provide them an opportunity to express their views regarding the project, discuss the environmental and social impacts of the project, and derive mitigation measures of the adverse negative impacts of the project,” he says.

The Company organised a tree planting exercise in liaison with members of the community as part of its environmental conservation programme for the area.

Banda pledged that when the project reaches mining stage, the surrounding community should expect more development projects as part of CSR, employment and business opportunities.

“The government of Malawi is actively utilizing the potential of the agriculture, tourism, and mining sectors to boost the country’s economy. With abundant reserves of minerals, including bauxite and REEs, Mulanje Mountain presents a valuable opportunity for mining ventures,” he says.

The prospecting project on Mulanje Mountain has sparked protests from environmental activists, who express concern over the potential damage to the ecosystem and the cultural significance of the Mountain.

Mathews Malata, an environmental activist, warns that the government should proceed with caution when considering mining in Mulanje Mountain stressing that the mountain holds great importance to Malawian citizens, who view it as a symbol of pride.

Malata says mining activities will endanger ecosystems and the mountain’s heritage.

 “Malawi should tread carefully when choosing between mining and tourism because Mulanje mountain is in the top ten tourism destinations in the country, additionally, mining in the mountain is contrary to the international laws as the mountain is one of United Nations Educational Scientific and Cultural Organisation (UNESCO) heritage sites,” says Malata.

Malata suggests exploring other alternative areas that are not protected and can be mined for the same minerals.

Emmanuel Elija, Chairman of the Mulanje Mountain Care Group, says there is need for more community involvement by government and the tenement holder so that the community understands how the mountain will be spared from the environmental impacts of mining,

He says the local residents are keen to know the potential benefits and drawbacks from the project through civic education.

“The company that is conducting the exploration of minerals and the Government needs to conduct adequate civic education to inform the people about the project details. This will help the community not to perceive the project as a threat to their lives and well-being,” says Elija.

Chambe is a unique rare earths deposit as it is an ionic clay deposit. These deposits generally have several advantages over hard rock deposits, including lower operating and capital costs and shorter timelines for development.”

The deposit is one of the few large ionic clay-hosted rare earth elements (REE) deposits outside of China, where currently a significant portion of global REE production is sourced.

ASX-listed Lotus Resources, which operates the Kayelekera Uranium Mine in Karonga, says it will accelerate Kayelekera restart activities targeting resumption of production in the fourth quarter of 2025 to benefit from strong current and forecast uranium market fundamentals.

Lotus MD Keith Bowes says this in a statement as the Company announces that it is undertaking a placement to strategic investors to raise US$30-million through the issue of 100 million new shares.

“We are pleased to secure US$30m through this Placement, allowing us to accelerate our activities around the restart at Kayelekera. The Placement has attracted significant interest from high calibre strategic investors who share our bullish view on uranium market fundamentals,” states Bowes.

He says the company aims to finalise financing and offtake for the project including appointing a debt advisor to assist in the financing process and negotiating offtake agreements with suitable parties that can strengthen its position.

Lotus also aims to finalize negotiations for a power supply and implementation agreement with Malawi’s electricity utility, Electricity Supply Corporation of Malawi (Escom).

“The agreement is key to achieving reduced operating costs announced in the Restart Definitive Feasibility Study in August 2022,”states Bowes.

Meanwhile, Lotus is also initiating a Front-End Engineering Design (FEED) program, which will provide reliable quotes from suppliers and further refine cost estimates, timeline and operation cost.  

“These will confirm the upfront capital cost estimate for the plant refurbishment and new equipment installations such that a control budget can be prepared for the restart and validate the 15-month timeline initially determined for the refurbishment program,” says Bowes.

Lotus has also announced its intention to design an infill drill program, targeting the most economically viable parts of the resource. This program aims to upgrade the resource and convert it where necessary into Measured and Indicated (M&I) status. The results obtained from the drill program will play a vital role in preparing a new Mineral Resources Estimate, reflecting increased M&I resources.

Uranium prices have continued to rise as Kazakhstan’s state-owned Kazatomprom, the world’s largest uranium producer, stated that it would be unable to meet its production target for the next two years amid a shortage in inputs and construction issues.

This is added to Canadian Cameco’s outlook downgrade in September due to issues in key mines and uncertainty over French Orano’s output due to Niger’s military coup.

Additionally, Western utilities continues to voluntarily shun Russian uranium imports due to its invasion of Ukraine, while the US has moved closer to banning its imports.

In the meantime, ambitious de-carbonization goals has driven the US and 20 other countries to announce that their nuclear power will be tripled by 2050.

The large bets on nuclear energy are led by China, which is building 22 out of 58 global reactors, while Japan restarted projects to increase nuclear power output.

ASX-listed Lindian Resources, which is conducting mine development studies at its Kangankunde Project in Malawi’s Balaka District, says infill drilling results from the project show strong continuity of high grade mineralisation from surface to end of hole in planned first phase mining areas.

Lindian CEO Alistair Stephens explains that assay results received for initial 21 holes of the Phase 3 infill drilling program has displayed consistent outstanding high-grade mineralisation demonstrating strong continuity.

• Significant intersections include:

? 150 metres from surface to EOH averaging 3.78% TREO in KGKRC087

? 75 metres from surface to EOH averaging 3.57% TREO in KGKDD011

? 70 metres from surface to EOH averaging 3.44% TREO in KGKDD012

? 150 metres from surface to EOH averaging 3.21% TREO in KGKRC086 including: o 38 metres @ 4.63% TREO from 74 metres to 112 metres

? 150 metres from surface to EOH averaging 3.18% TREO in KGKRC112

? 75 metres from surface to EOH averaging 3.15% TREO in KGKDD010

? 150 metres from surface to EOH averaging 2.81% TREO in KGKRC10

Stephens reports that samples from a further 28 holes are being analysed and expected to be released prior to the end of February.

The results from Phase 3 program aim to define a portion of Kangankunde’s current Mineral Resource Estimate (MRE) of 261 million tonnes grading 2.19% TREO as indicated category.

He says an updated MRE including the Indicated Resource category will be reported prior to the release of the Feasibility Study which is scheduled for the end of the March quarter while a Maiden Ore Reserve statement will be reported with the Feasibility Study.

Stephens also reports that processing plant engineering and mine development works are proceeding as planned.

He says: “The first assays from our Phase 3 drill program are again very encouraging, with grades in one 38 metre interval of 4.63% TREO (or 46,300 ppm TREO), and demonstrate that high grade rare earths are consistent across a ~300m section from surface of the Kangankunde deposit which is particularly noteworthy as we advance towards the Phase 1 mining and processing operation.”

“We are on track to report our upgraded MRE this quarter which will be followed shortly thereafter by our Feasibility Study. Kangankunde is uniquely positioned as one of the world’s largest rare earths projects, based on a globally recognised reporting code, and underpinned by exceptionally high grade in a market where grade is now clearly king. We anticipate a more regular flow of updates as the next two quarters unfold.”

Lindian Executive Chairman Asimwe Kabunga commented that the assay results from the Phase 3 drill program are an important body of work and key to the delivery of the Feasibility Study for the Stage1 mine development that is now underway.

“This Study, which will also include an Ore Reserve statement for Kangankunde for the first time, will allow us to very clearly define first stage capital expenditure and operational expenditure, and showcase what we expect will be a robust project that can rapidly deliver a new source of dependable supply of rare earths to processors and end users. As our quarterly report reiterates, we are well funded with lots of optionality to fund our Stage 1 plant and the initial early works phase which will be underway soon,” Kabunga says.

The holes reported are infill holes designed to provide sufficient data to increase the confidence level of a portion of the MRE to Indicated status.

Once the remaining results are received from the assay laboratory, the resource model will be updated and applied to detail mine design and scheduling.

The areas targeted by the Phase 3 infill program are those considered most likely to define initial feed for operation of the Stage 1 Processing facility.

These are a) the northern area of the central carbonatite complex, the western area of the central carbonatite complex; and the south-eastern area of the central carbonatite complex.

Non-Radioactive Mineralisation

Stephens reports that radionuclides uranium (U) and thorium (Th) continue to be low in all areas of Kangankunde Project.

“The Company has independent confirmation of the low radiation of mineralisation at Kangankunde, with independent government agency ANSTO Minerals (Australia Nuclear Science Technology Organisation) confirming that Kangankunde Rare Earth mineral concentrates are not classified as radioactive for transport,” he says.

Drilling programme status

The Phase 3 program has been completed with 45 RC holes for 4,666 metres and 3 core drill holes for 220 metres. The program was designed to give infill data for resource evaluation and mine planning of areas targeted to potentially provide the initial years of production.

In August 2023, Lindian announced its maiden Mineral Resource Estimate (MRE) for the Kangankunde Rare Earths Project in Malawi of 261 million tonnes averaging 2.19% TREO above a 0.5% TREO cutoff grade, and estimated in accordance with JORC 2012 guidelines.

Processing plant engineering

Lindian’s team is also progressing with:

• Determination of the preferred provider in relation to the tender of civil works contract(s), inclusive of works for the access road upgrade, bulk earthworks for the Plant & associated infrastructure, Tails Storage Facility (TSF) and Return Water Dam (RWD),

 • Finalisation of the tender for the supply of Process Plant and associated infrastructure for Engineering, Procurement, Construction and Commissioning,

• Resource model update and detailed mine design and mine schedule,

• Short-listing of power and fuel supply options while contract terms are being finalised for all stream of works.

In order to enhance revenue collection from the minerals sector, Malawi Revenue Authority (MRA) has taken over the responsibility of collecting mineral royalties from the Ministry of Mining.

MRA’s spokesperson Steven Kapoloma says in an interview that the tax collecting body will start collecting the royalties from April 1, 2024.

“In view of this, MRA has been engaging mining companies to sensitize them on the transfer of collection of royalties. Mining companies will be required to conduct a self-assessment and file royalty return upon producing minerals,” says Kapoloma.

The royalty return is a declaration of values and volumes of the minerals which a company has to submit to the Department of Mines. Mining companies then have to determine whether the minerals are for export or local use.

Kapoloma said:  “If the minerals are not for local use, a mining company is required to declare interest to the Department of Mines to export.

“The Geological Survey will then evaluate the mineral royalty base to determine value and volume, issue a certificate of inspection and seal the container.”

“The Department of Mines will then process a royalty return and file the processed return to MRA through Msonkho Online.”

”Upon payment of mineral royalty, the Department of Mines will issue an export permit to the exporter.”

The Ministry of Mining has been collecting mineral royalties from mining companies in Malawi and this mandate came from the Mines and Minerals Act.

Though the Ministry has been collecting mineral royalties, Kapoloma says there have been challenges as far as capacity is concerned.

He, therefore, explains that in 2029 the Mines and Minerals Act and the Taxation Act were amended to transfer the collection of mineral royalties from the Ministry of Mining to MRA.

“The collection of mineral royalties has been transferred to MRA because it has the capacity to collect both tax and non-tax revenues,” says Kapoloma.

Meanwhile, MRA is developing an ICT system to facilitate the payment of mineral royalties through e-payment.

The Mines and Minerals Act 2023 says a holder of a mineral tenement who contravenes the law by not paying royalties, upon conviction, shall be liable to a fine of K10-million plus double the value of the minerals, transport, sale, pledging or other transfer and, to imprisonment for two years.

Stakeholders in the minerals sector have urged the Malawi Government to promote local participation in the minerals sector if it is to adequately contribute to the economic development of the nation.

This comes in the wake of a Tanzanian consulting firm Azurite Management and Consultancy launching its operations in Malawi’s mineral sector at a colorful ceremony in Lilongwe, which was graced by Minister of Mining Monica Chang’anamuno.                                                                  

Azurite is a technical and service provider which is focused on providing general business support to local and foreign investors in sub-Saharan Africa especially in the mineral exploration and mining sector.

The company offers a number of services to resource firms including government liaison, tenement management, procurement and logistics, compliance and permitting, exploration management and country risk assessment.

However, in separate interviews stakeholders have questioned why government is at the forefront in promoting the foreign owned firm while there are local firms that have the required qualifications and experience in offering similar services to the minerals sector when also the Mines and Minerals Act (2023) prioritizes local participation in minerals sector.

Reads Section 159 of the Act: “(3) A holder of a mining licence required to have an approved goods and services procurement plan shall give preference to procuring goods and services from supplier and contractor entities owned by Malawian citizens, including equal opportunities to entities owned by Malawian women, provided such supplier and contractor entities offer terms as to prices, quantities, qualities and delivery schedules that are at least comparable to terms offered by non-Malawian contractors and suppliers to the maximum extent practicable consistent with efficient operations.”

“(4) A holder of a mining licence required to have an approved goods and services procurement plan shall demonstrate in its goods and services procurement plan how it intends to assist Malawian suppliers and contractors, including those owned or operated by women, to build the capacity to supply a greater part of its project’s goods and services needs over time.”

“(6) A holder of a mining licence shall not be hindered from procuring goods and services from providers outside Malawi that, to the satisfaction of the Authority, are available from only specialized suppliers and contractors.”

Coordinator for Chamber of Mines and Energy who runs a professional consulting firm for the minerals sector known as Geomine Services Grain Malaunga  said it is important for Malawi to promote local goods and services in the mining sector in order to maximize benefits of the sector to the local population and ensure sustainable economic growth with mining as a key enabler as stipulated in Malawi 2063.

He said: “It becomes a challenge when those goods and services are imported because they will obviously become more expensive than direct sourcing.”

“I encourage exploration and mining companies to engage local expertise in technical work. Local labour is cheap and capacity building will be enhanced.”

Coordinator for Natural Resources Justice Network Kennedy Rashid agreed with Malunga on the need for mining companies to prioritise locals wherever the capacity is available as stipulated in the Act.

Rashid said: “The engagement with local communities in other aspects across the supply chain where there is need is very important as it ensures that there is redistribution of benefits directly into the local economy.”

“What is required is for companies to also share their operational needs with local communities for the later to be aware of what is expected from them to participate directly in the sector.”

As part of its procurement and logistics package, Azurite supplies drilling consumables and safety gears and offer transportation logistics and car hire services.

Local Suppliers of similar services have also questioned the Malawi Government on why it is promoting a foreign firm to offer these services to the minerals sector while they are toiling to have business.

“The Tanzanian market is very difficult to penetrate. They have even made it harder for us to export our coal from the northern coalfields. I wonder why the Malawi Government is promoting a company from that country to come to Malawi and dominate in offering all services that are already being offered by locals,” said a supplier of mining equipment who opted for anonymity.

MD for Tamara Safety Products and Hardware Lloyd Phiri in a separate interview also urged Government to promote local suppliers to serve the minerals sector.

He said his shop is fully stocked to the extent that his Company can supply any personal protective gear to the sector.

”You have seen for yourself that in our shop there is everything in terms of protective gear. If Government can help us get deals with mining companies so much the better,” said Phiri.

But First Principal Secretary in the Ministry of Mining Joseph Mkandawire backed the coming in of the Tanzanian firm saying it will help the country explore its minerals with ease.

In an interview, Mkandawire expressed hope that the company will be able to bring into the country mining equipment which currently the country lacks.

He said: “We will benefit greatly from this firm not only from their technical expertise but equipment as well. They have equipment which can help extract minerals from 500 metres underground,” said Mkandwire.

During the launch of Azurite operations in Malawi, Minister of Mining Monica Chang’anumuno bemoaned the mining sectors minimal contribution to gross domestic product (GDP) which stands at one percent saying the sector has great potential but is not contributing much to the economy.

“We need to do more in order for investors to come into the sector to ensure growth,” she said.

We join stakeholders in the minerals sector in urging the Malawi Government to promote local participation in the minerals sector if it is to adequately contribute to economic development of the nation.

As mineral sector expert Dr Grain Malunga says in our article on Page 7, it is important for Malawi to promote local goods and services in the mining sector in order to maximize benefits from the sector to the local population and ensure sustainable economic growth with mining as a key enabler as stipulated in Malawi 2063.

We also feel Dr. Malunga’s sentiments are in line with the Mines and Minerals Act 2023 which as reported in the said article obliges resource firms to procure goods and services locally and only consider foreign or imported when Malawi does not have the required goods or services.

Resource firms involved in large scale mining ventures are mostly foreign owned and we feel one of the most important ways Malawians can benefit from such ventures is through getting employment and procurement contracts from these projects.

We, therefore, urge the Ministry of Mining to play a role in promoting locally owned enterprises to serve the mining sector and also Malawians to take up key positions in resource firms operating in the country.

It is through participation of locals in these firms that the Malawians will do away with the mentality by some that large scale mining is for rich foreigners, and any animosity towards foreign mining investors.

We, therefore, also join Dr Malunga in urging resource firms to engage locals wherever possible.

We understand that countries in the region have more developed mineral sectors compared to Malawi hence have a pool of experienced personnel including consultants, contractors and suppliers.

However, it is important that the resource firms invest in capacity building initiatives to ensure that the locals, who are the actual owners of the minerals, are equally competent in offering the required goods and services.

As Coordinator for Natural Resources Justice Network Kennedy Rashid is quoted in the article, what is required is for companies to also share their operational needs with local communities for them to be aware of what is expected from them to participate directly in the sector.

Foreign owned firms should not provide to mines what Malawians are capable of offering including mineral exploration and environmental and social impact assessment consultancies, media and government liaison, car hire services, supply of personal protective equipment, civil works and supply of mining equipment. 

The Malawi Government says it realised a total of K27.2-million from mineral sample royalties in the 2121/2022 fiscal year.

This is contained in In the 2022/23 annual economic report published by the Ministry of Finance and Economic Affairs.

The report outlines that exploration companies in Malawi exported 14.3 tonnes of rock chip samples and paid K19.5-million Kwacha in royalties to government.

The resource firms exported 7.8-tonnes of soil samples yielding the Malawi Government K7.7-million tonnes in royalties.

However, the report states that the major mineral exports for the country were gemstones and dimension stones which continued to be exported to a number of countries including India, China, Thailand, Sri Lanka, Hong Kong, USA, England, Italy, South Africa, Poland, Netherlands, and Switzerland.

In 2022, higher gemstone production was recorded amounting to 329.45 tonnes reflecting an increase of over 2000 percent compared to the production in 2021.

Gemstones produced included aquamarine, amethyst, citrine, garnet, rhodolite and ruby. Government, however, expresses concern in the report that despite high gemstone production, value addition is still very low implying potential revenues are lost as gemstones fetch lower prices in their rough (unprocessed) form.

“Investment in value addition would generate significant income, provide employment opportunities, and create business opportunities in jewellery production and selling,” reads the report.

Malawi is endowed with a wide range of mineral resources, some of which have been mined for decades, and some whose potential for beneficiation at medium to large-scale levels is recently being discovered.

Malawi 2063 identifies mining as a key driver to the economic development of the country. Mining is one of the priority areas under the industrialization pillar in the country’s effort to achieve the upper-middle income status by the year 2063.

“Mining has tremendous potential to support industrialization in Malawi, yet it has not been fully harnessed. The sector contributes only one percent to national income,” reads the report.

It says the mineral sector still faces great challenges resulting in the loss of potential public revenues due to unreported income and smuggling, coupled with environmental damage and health hazards due to sub-standard methods of mining and processing.

Further investments in the sector is challenged by a low power supply, a lack of reliable road and railway infrastructure, and other economic constraints. These factors increase overhead and production costs thus deterring investors and undermining the growth of the sector.

ASX-listed Sovereign Metals, which is prospecting for rutile and graphite at Kasiya in Lilongwe, says wide-spaced regional reconnaissance drilling outside its current Mineral Resource Estimate (MRE) area, has identified an 8km extension of mineralisation to the south, which remains open along strike and at depth.

MD for Sovereign Metals, Frank Eagar, says in a Press Statement that the results are testament to the world-class scale of the Kasiya deposit and demonstrate the potential for a future increase of the MRE for Kasiya, which is already the largest natural rutile resource, and second largest flake graphite resource, in the world.

Kasiya’s current MRE of 1.8 Billion tonnes, at 1.0% rutile and 1.4% graphite, comprises broad and contiguous zones of high-grade rutile and graphite that occur across an area of over 201km2.

Eagar says: “These drilling results re-confirm the significant scale of the Kasiya deposit with the strike now stretching over 37km long.”

“Sovereign continues to test the extent of regional mineralisation via low-cost hand-auger drilling, which has the potential to increase the already very large Kasiya resource.”

Sovereign reports that all newly defined mineralisation remains open at depth, due to the limitations of the hand-auger drilling method, but are expected to continue to the Saprock boundary, normally between 20 and 30m vertical metres from surface. The multiple mineralised zones identified remain open along strike, both to the north and south including;

· 14m @ 1.03%, including 2m @ 1.35%, rutile from surface

· 17m @ 1.01%, including 2m @ 1.42%, rutile from surface

· 9m @ 0.93%, including 2m @1.58%, rutile from surface

· 12m @ 1.31%, including 3m @ 1.97%, rutile from surface

· 13m @ 1.02%, including 3m @ 1.16%, rutile from surface

 · 12m @ 1.02% rutile & 4.5% graphite, incl. 2m @ 1.41% rutile, from surface

Results of the Pre-Feasibility Study (PFS) released in late 2023 demonstrated Kasiya’s potential to become the world’s largest rutile producer at an average of 222kt per annum and one of the world’s largest natural graphite producers outside of China at an average of 244kt per annum, based on an initial 25 year life-of-mine (LOM).

The Kasiya PFS indicated compelling economics with a post-tax NPV8 of US$1.6 Billion and a post-tax IRR of 28%. This long-life, multi-generational operation was modelled to initially generate over US$16 Billion of revenue and provide an average annual EBITDA of US$415 Million. The PFS modelling was limited to 25 years with initial Probable Ore Reserves declared of 538Mt, representing only 30% of the total MRE.

The PFS confirmed Kasiya as a major critical minerals project with an extremely low carbon footprint, delivering major volumes of natural rutile and graphite, while generating significant future economic returns to Malawi.

The PFS indicates that Kasiya will be a simple and conventional operation employing traditional and well-developed processes used across the globe on mineral sands and graphite operations.

The proposed large-scale operation will process soft, friable mineralisation mined from surface. The project has excellent surrounding infrastructure including bitumen roads, a high-quality rail line connecting to the deep-water port of Nacala on the Indian Ocean, and hydro-sourced grid power.

Graphite co-product

Kasiya’s graphite co-product Mineral Resource Estimate (MRE) is 1.8Bt at 1.4% graphite, containing  24.4Mt of graphite, which makes it one of the largest natural graphite deposits globally. 

The PFS indicates that graphite rich pre-concentrate will be produced from the light fraction of the gravity spiral tails, and processed in a separate graphite flotation plant to produce a high-quality flake graphite co-product. Because graphite will be a co-product from rutile production, it will have a very low production cost compared to graphite-only projects, as shown in the Project’s Expanded Scoping Study.

A very coarse-flake and high-grade graphite product, at 96% Total Graphite Concentrate (TGC) can be produced via the simple flowsheet. This product has over 60% of  large to super-jumbo fractions (+180mic) with overall graphite recovery from the raw sample of 62%.

“As well as being very coarse flake, the Kasiya graphite is also highly crystalline and of high purity. These are both important features required for use in lithium-ion battery anodes. The high crystallinity means that the graphite will have high electrical conductivity – a key requirement. High purity means the material will be easier to upgrade to 99.95% TGC, the minimum requirement for lithium-ion battery anodes,” says Eagar.

Malawi President highlights Kasiya in SONA

Meanwhile, Malawi’s President Dr Lazarus Chakwera has hailed progress of the Kasiya Rutile-Graphite Project.

Chakwera said in his State of the Nation Address (SONA) presented in the National Assembly at the opening ceremony of the 2024/25 Budget Meeting: “Madam Speaker, my progress report on wealth creation efforts in mining would not be complete if I omitted the progress on the Kasiya Rutile Project.”

“As I speak, Sovereign Metals Limited and Rio Tinto have entered into a partnership, and now the project is undergoing a Definitive Feasibility Study and an Environmental and Social Impact Assessment, which mark a crucial step in advancing the Kasiya Rutile-Graphite Project in Malawi.”

“When all these operations begin to yield a harvest, it will be a game changer for Malawi not only economically, but also geopolitically, for we have every reason to expect that we will become less dependent on outsiders for any resources to build our roads, our hospitals, our bridges, our schools, our universities, our airports, and more. The work we have done this year to restructure the sector is great progress, and we will build on it to keep our economic recovery going.”

Sustainable and ESG driven

Eagar says that sustainability is a vital element of Sovereign’s strategy for Kasiya, such that the company is committed to making informed choices that improve its corporate governance, financial strength, operational efficiency, environmental stewardship, community engagement and resource management.

The project aims to meet the requirements of international guidelines and standards, including the International Finance Corporation (IFC) Standards on Environmental and Social Sustainability (IFC 2012), the World Bank Group Environmental, Health and Safety Guidelines (WBG 2007), the Equator Principles (Equator Principles Association, 2020) and the International Council on Mining & Metals Principles.

Eagar says the Kasiya Project will be designed considering both the Equator principles and Scope 1, 2 and 3 emissions under the Green House Gas protocol, so that the design meets high Environmental, Social and Governance (ESG) standards from the outset.

“Access to hydro-generated grid power and a solar power system to be installed on site will ensure low carbon power supply for the project, and the use of predominantly rail rather than road transport for rutile and graphite products will further help give the mine a low carbon footprint,” says Eagar.

The planned operation contemplates a closed, zero discharge process water circuit, and tailings storage facility designed for chemically benign tailings which will be rehabilitated and restored progressively.

Meanwhile, Sovereign continues to undertake several initiatives to assist in the development of Malawi and its local communities.

“The Company aims to become an industry leader in social responsibility having successfully worked with communities in Malawi over the last decade who remain highly supportive and are well positioned to benefit from the development of new mining projects.