Mining & Trade News

Parliament is in the next sitting ex- pected to deliberate and pass a bill for a new law, the Mines and Min- erals Act 2026, which is likely to be a stumbling block to plans by ASX-listed Lindian Resources to kickstart commercial exportation of monazite concentrate from Kanagnkunde mine in Balaka.

The Kangankunde Rare Earth Deposit is a globally significant deposit that is one of the biggest in the world with rare earths now in high global demand as they are used in modern high-tech applications in- cluding electric vehicles, wind turbines and military ware with superpowers such as the USA, EU and People’s Republic of China involved in a geopolitical war over the resources.

A draft of the bill that Government is using for stakeholder consultations indi- cate that the new law will contain thresh- olds up to which all minerals must be processed before export, which is in line with State President His Excellency Arthur Peter Mutharika’s ban on raw mineral ex- ports declared last year through an Execu- tive Order.

The draft requires rare earth mines in Malawi to process ore to rare earth oxides, which is the final stage before exportation. Lindian is, however, producing monazite concentrate, which is an immediate stage in the processing cycle with its Executive Chairman Robert Martin arguing that this is the final stage possible in Malawi due to lack of adequate electricity and water in addition to environmental complications associated with dangerous chemicals used in rare earth processing.

“Government has decided to incorporate elements of the Presidential raw mineral export ban into the new law so that we do not confuse these issues,” said the source who opted for anonymity.

He said the new Act has also substan- tially reduced the thresholds for classify- ing mines as large scale, which will see Kangankunde and many mechanized mines including cement and quarries auto- matically transitioning to large scale.

“Lindian will this time fail to escape the trap. They used the court to get the licence after government refused to renew it, and the same law will apply for them to transi- tion to large scale mining,” said the source

He sounded upbeat that the Mines and Minerals Act 2026 to replace the 2023 Act, currently in force, “will clean up all the rot in the sector.”

Lindian is currently using a medium scale mining licence belonging to Rift Val- ley Resources Development acquired through a US$30-million shareholding deal.

There have been calls from a cross-sec- tion of Malawians led by Speaker of the National Assembly Honourable Sameer Suleman urging Lindian to upgrade the li- cence to large scale understanding the huge size and value of the deposit.

The calls have reportedly led to Lindian applying for a large scale mining licence following an order from the Attorney Gen- eral.

As opposed to medium scale, a holder of a large-scale mining licence signs a Min- ing Development Agreement with govern- ment that allows Government to negotiate dues for the host country including state equity.

The large scale mining licence holder is also mandated to sign a community devel- opment agreement with the privileged communities in the mining area.

Meanwhile, Government is pursuing en- forcement measures against Rift Valley al- legedly for allowing Lindian to use its medium scale licence without following government procedures that involve noti- fying the Mining and Minerals Regulatory Authority over transfer of rights.

“Government has started the cancella- tion process for the licence but it is not au- tomatic that the licence will be cancelled. There are notices involved, and the Law provides for a 30-day notice period then the licence holder has to justify why the li- cence must not be cancelled,” says the source.

Lindian’s founder and largest share- holder Asimwe Kabunga brandished a 2018 Malawi Supreme Court order on so- cial media warning Malawi Government not to tamper with Rift Valley’s Medium Scale Mining Licence which drew the wrath of a cross- section of Malawians.

Rift Valley acquired the Kangankunde licence following a protracted court wran- gle that saw the court ruling that Govern- ment awards the mining hopeful US$100-million after it cancelled the li- cence. Government just opted to renewthe licence for the Company.

Minister of Mining Thoko Tembo has,meanwhile, commended progress made in developing draft amendments to the Mines and Minerals Act of 2023, say- ing the proposed changes will strengthen governance and support sustainable development of the mining sector

The amendments include removing MMRA’s mandate to establish coopera- tives, strengthening the use of local sup- pliers and contractors, and training Malawians in specialized skills.

The draft also proposes reducing the ex- ploration license period from 11 to seven years, limiting applicants to three explo- ration licenses, and allowing increased use of machinery in artisanal and small-scale mining under strict conditions.

The proposals also include at least 40 percent beneficial ownership by Malawian citizens in medium-scale mines, while large-scale mines would be required to offer at least 20 percent of shares to Malawians at fair market value or list on the stock exchange.

Proposed regulations on mineral pro- cessing and value addition, include mini- mum beneficiation requirements for different mineral groups. For precious met- als, these include crushing, milling, sepa- ration, smelting, dewatering and refining.

There are also regulations on licensing, occupational safety and health, environ- mental management, community develop- ment and penalties.

The Ministry is developing the drafts through benchmarking with other coun- tries and stakeholder consultations.

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