Malawi destined to become world’s top rare earth producer

Lilongwe – Malawi has renewed Canadian company, Mkango Resources’ exclusive prospecting licence for its flagship Songwe Hill Rare Earth project in Phalombe, southeast of the country.
Mkango spokesperson, Ashlee Utterback, says the company ‑ which commenced trading in 2011 ‑ was granted the extension following successful delivery on the objectives outlined at the time of listing and is now focused on progressing the Songwe Hill project to production stage.
The licence is effective from January 2013 and renewable for a further two-year period in January 2014.
He said US$429 800 has been committed for this phase.
“The EPL grants Mkango exclusive rights to explore for all 17 rare earth elements (REE) as well as strontium, niobium, iron ore, manganese, gold, silver, copper, bauxite, fluorite, phosphate, uranium, thorium, monazite, nepheline, syenite, zircon, tantalum, clay, kaolinite, and associated minerals,” Utterback says.
He adds: “Mkango believes Malawi is one of the most favourable jurisdictions to be operating in Africa and has the potential to become one of Africa’s foremost rare earth producers”.
During the launch of the Mining Governance and Growth Support Project at the Bingu International Conference Centre in Lilongwe in January, Mkango Resources Limited president, Alex Lemon, hinted that with the exploration of rare earth, Malawi is destined to become the top rare earth producer in Africa, if not the world.
Lemon noted that Malawi is not only a stable country, but also has a strong support for new mining initiatives, which “allows year-round exploration and mining, providing a low cost exploration environment and has significant geological potential with improving infrastructure.”
The Ministry of Mining Principal Secretary, Leonard Kalindekafe, says the Mining Governance and Growth Support Project would support the government’s mining sector reform programme.
The project, approved in March 2011 and to be led by Remi Pelon, will be financed through a US$25-million World Bank loan, with an additional US$5.66 million from the European Union. The French government will also inject 11 million euro and technical expertise for geological mapping of the country.
Kalindekafe said the project aims to improve the efficiency, transparency and sustainability of management of the mining sector in Malawi.
“It will focus on strengthening institutional capacity of the sector with modern mining legislation and computerised mining cadastre,” he said.
He added that successful implementation of the project will help mitigate risk of resource curse where countries that have great commodity wealth but poor socio-economic development benefit through supporting efforts of the government to comply with the Extractive Industry Transparency Initiatives as well as working with civil society and building their capacity.
Utterback explained that Mkango sees the investment environment in the country as favourable in terms of the upcoming infrastructure projects, such as Vale investment in Malawi’s rail rehabilitation and the improvement taking place in the energy sector.
Brazilian mining giant, Vale, is building the US$2-billion railway lines from Moatize, in the western province of Tete, to the northern Mozambican port of Nacala aimed to transport coal and other products mined by the company at its concession in Moatize.
Last week President Joyce Banda and her Mozambican counterpart, Armando Guebuza, signed the Malawi-Mozambique Power Interconnector deal, which will see Malawi tap electricity from Mozambique.
Kalindekafe was also upbeat with the country’s current regulative and legislative framework saying, “It is good for mining investors”. Last month, Mining Minister John Bande told the second UK-Malawi Investment Forum that his country was slowly but surely discovering a number of mineral deposits.
“That’s the whole reason President Dr Banda has selected mining as one of the priority areas under the economic recovery plan,” he said.
Graeme Robertson, chairperson of the Intra Energy, explained his company’s ambitions to mine coal in Malawi and support coal-fired power generation in the southern African nation.
Mkango Resources holds two EPLs covering 1 751 square kilometres in southern Malawi.
The main exploration site is Songwe Hill, which features carbonatite hosted rare earth mineralisation.
Utterback said the secondary exploration site is Tambani in the southwest of the country where exploration work focuses on heavy rare earth enriched breccias and ion adsorption clay-hosted rare earth deposit.
“The first two years comprised two phases of diamond drilling totalling 6 850 metres, with on-going scoping metallurgical test work,” he said adding “No further drilling is anticipated because of the significant size of the mineral resources already identified”.
He said the inferred resources stands at 18.6 million tonnes at 1.38 percent total rare earth oxides.
Songwe Hill Rare Earth Project is located within the EPL that covers 1 283 square kilometres in Phalombe District, which is close to the country’s second largest water body, Lake Chilwa Basin, which is a protected site under the Ramsar Convention on Wetlands of international importance.

April 2013
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