Mining & Trade News

Mkango Rare Earths has announced
the results of an
updated feasibility study
for its Songwe Hill Rare Earths Project
in Phalombe, marking a significant step
forward for what could become one of
Malawi's most important mining developments

The company's President, Alexander
Lemon, noted that Songwe is now
among only a handful of rare earths projects
worldwide to have reached the Definitive
Feasibility Study (DFS) stage.
The project also holds a Mining Development
Agreement and has completed a
full Environmental, Social and Health
Impact Assessment in line with World
Bank standards — an indication of the
rigorous preparation that has gone into
bringing it to this point.

Songwe has attracted significant international
attention. It has been selected as
a strategic project under the European
Union's Critical Raw Materials Act and
has received US$4.6 million in technical
assistance funding from the United
States Development Finance Corporation
(DFC).

"Songwe in Malawi is a landmark
project for the community and the
Malawi economy," said Lemon. "Our
mission is to deliver sustainable, long
term value for our shareholders and
stakeholders."

The project is set to produce rare earth
elements- including neodymium,
praseodymium, dysprosium and terbium- that are essential to the global shift to
wards clean energy. These materials are
used in the permanent magnets found in
electric vehicles, wind turbines and a
wide range of electronic devices, mean
ing demand for them is expected to grow
strongly in the years ahead

According to the feasibility study,
Songwe is expected to operate for 18
years, producing an average of nearly
6,000 tonnes of rare earth oxides per
year during the first five years of full
production. The total cost of developing
the mine, processing plants and related
infrastructure in Malawi is estimated at
approximately US$417 million.

The financial projections are encour
aging. The project carries an estimated
post-tax net present value of US$339
million and an internal rate of return of
24 percent. Over the life of the operation,
post-tax cash flow is projected at
US$1.55 billion — figures that underline
the scale of economic activity the proj
ect could generate for Malawi

Under more optimistic pricing scenar
ios, those figures rise further still, with
the project's net present value climbing
to US$489 million and projected cash
flows reaching over US$2 billion.

The mine will operate as a conven
tional open pit, with ore processed and
value add beneficiation taking place on
site in Malawi. Songwe will produce a
high value purified mixed rare earth car
bonate (“MREC”)in Malawi, that can be
sold into international markets as a forex
generator export. The study confirms
mineral reserves of 18.1 million tonnes,
and the company believes there is scope
to extend the mine's life further as addi
tional resources are explored in the fu
ture

For Phalombe and for Malawi more
broadly, Songwe Hill represents a sub
stantial opportunity- both in terms of di
rect investment and the country's
growing role in supplying the critical
materials the world needs for a greener
future

Leave a Comment

Comments