Landmark discovery

Lemon (R) explaining to Kutsaira and his Deputy Mwambande

…Exploration drilling unveils 60% increase in Songwe Hill rare earth resources

…Hon. Kutsaira hails Mkango for tremendous progress, ground breaking CSR programs

By Marcel Chimwala

Malawi is on course to have a rare earth mining operation of larger magnitude than earlier planned at Songwe Hill in Phalombe as results of last year’s exploration drilling program have revealed that the amount of measured and indicated rare earth resources is 60% larger than previously discovered in earlier studies.

This was discussed by Canadian and UK listed firm Mkango Resources Limited, which is prospecting for rare earth elements (REEs) at the site when Minister of Natural Resources, Energy and Mining Honorable BintonyKutsaira visited the exploration site.

Mkango President Mr. Alexander Lemon explained to the Minister that his company is happy that there will potentially be a larger operation at Songwe as that may translate into more jobs for the people of Malawi, more taxes and royalties for the Government and a quicker return of the investors financing.

Lemon said: “We believe that the world market for rare earth elements (REEs) will improve significantly as Nd, Pr, Dy and Tb are all very important REEs required in high strength magnets that are used in numerous clean technology   and energy applications such as electric vehicles and direct drive wind turbines which are integral to the ongoing worldwide electric revolution, as well as consumer electronics such as mobile phones and laptops.”

Kutsaira hailed Mkango for the tremendous progress of the project, its community involvement approach and Corporate Social Responsibility programs.

Mkango Resources says results of a major (11,000 meter) drilling program, conducted on its Songwe Hill REE deposit in Phalombe last year as part of the ongoing bankable feasibility study for rare earth mining, have revealed that the measured and indicated resources of the deposit are 60% larger than estimated for the pre-feasibility study.

The Company’s President said, when Minister visited the rare earth exploration, that with the latest study results, Mkango is now hoping to develop a larger mining project than previously planned.

Lemon said: “We had a very, very successful 11,000 m drilling program last year which has produced fantastic results. We had an increase of 60% in indicated and measured resources.”

“In the pre-feasibility study, we were looking at feeding 500,000 tonnes through the processing plant annually and we are now looking at potentially putting 1 million tonnes through the plant per year which means we can potentially have increased production which will enable us to earn more revenue and remit more taxes and royalties to the government. As a larger mining project, clearly it may also provide more employment opportunities to the people of Malawi.”

He said following last year’s drilling program, the Company is fast tracking various studies required to        complete the bankable feasibility study including mineral processing studies, engineering studies, and Environmental, Social and Health Impact Assessment (ESHIA).

Lemon explained that as part of the mineral processing study, the Company has shipped a 60 tonne sample to Australia where it will run a small (pilot) scale processing plant to test the designed processes.

“We are optimizing this test work to be certain that the engineering and mineral processing plant will work well here at Songwe Hill following a successful bankable feasibility study,” he said.

Lemon said the Company is conducting a full ESHIA in tandem with World Bank Equator principles to ensure that there is no threat to local communities when it starts mining and mineral processing work.

He explained that in the studies, his Company is working with world renowned engineering groups from technologically advanced countries including South Africa, Australia, Canada and Europe which are taking part in designing the plant.

‘It is essential for us to have a sustainable project here in Malawi because this is potentially a long term project with the minimum mine life estimated at 20 years,” Lemon said.

The Songwe Hill rare earth deposit is located in Chilwa alkaline geological province which covers large parts of the southern region of Malawi.

Rare earth element (REE) mineralisation at Songwe Hill is present in carbonatites, fenites and breccias, and the dominant REE-bearing minerals are synchysite and apatite.

Lemon said out of the 17 known REEs, Mkango is targeting neodynium, praesadynium, dysprosium and terbium which have a growing use in the production of strong magnets for the modern clean-tech and energy industries.

Lemon said:  “We believe that the world market for REEs will improve significantly as Nd, Pr, Dy and Tb are all very important rare earths required in high strength   magnets that are used in numerous clean technology and energy applications such as electric vehicles and direct drive wind turbines which are integral to the ongoing worldwide electric revolution, as well as consumer electronics such as mobile phones and laptops.”

He said: “There is an electrical vehicle revolution going on in the rest of the world including in South Africa where Tesla electric vehicles are already driving around in cities such as Johannesburg and Cape Town.”

“Petrol and diesel vehicles are being phased out across the world, and we predict that by 2035 Europe and North America will have banned the use of diesel and petrol vehicles and it is likely even Air travel will be powered by Electric and Hybrid motor. In the future world, rare earths will become increasingly important.”

In his speech, Kutsaira hailed Mkango Resources for continuing to develop the project, which he said will help Malawi diversify from its overdependence on tobacco as a major foreign exchange earner.

“If the mine starts operating, we will stop complaining of low tobacco prices as rare earths will become a major foreign exchange earner for Malawi,” he said.

He also saluted the company for establishing a close working relationship with the local community, and urged other extractive companies to learn from Mkango as a role model.

“I am impressed with the approach taken by Mkango of involving members of the community in the implementation of the project. I am told by traditional leaders present here, that some of their subjects in the villages are already employed by Lancaster Exploration (Mkango’s local subsidiary) and that they have a good relationship with the investor,” said Kutsaira.

The Minister, who was accompanied by his Deputy MungusulwaMwambande, also thanked Mkango for          investing in corporate social responsibility (CSR) even though the project is only at the exploration stage.

Other dignitaries who accompanied Honorable Kutsaira when he visited Songwe Hill, included Member of Parliament for the area Honorable Dennis Namachekecha, Chief Director in the Ministry Mr. Oliver Kumbambe and a large entourage of officials from the Ministry.

Mkango has so far implemented a number of CSR projects focused on empowerment of the communities, education, infrastructure, and reducing poverty and hunger in the community.

In the education sector, Mkango has an ongoing partnership with a local non-governmental organization, boNGO Worldwide, in a project aimed at raising the standards of education in the area.

The first stage of the initiative, called the Happy Classrooms Project, has enhanced the learning environments in three local primary schools namely Mphembedzu, Changa and Mangazi through syllabus-related paintings on classroom walls, an initiative which involved the painting of 24 classrooms at three primary schools.

Mkango is also running an annual competitive scholarship program to fully finance the whole secondary school education for the top three male and top three female students from these three primary schools.

Currently 12 boys and 12 girls in total 24 secondary school students are receiving 100% scholarships to pay for their whole secondary school education. They have managed to get into national secondary schools such as Dedza Government, Zomba Catholic, and St Patricks. Mkango is currently waiting for MSCE results for the first six scholarship students to see if they are able to be selected to public universities.

In partnership with Zero Hunger with Nishkam Langer, the company has helped to build two kitchens and two dining halls at Changa and Mphembedzu primary schools and is running a school feeding program that is providing a daily meal to in excess of 2,500 pupils a day.

Mkango has drilled and repaired numerous water bore holes for the surrounding community, and is also continuing with local road and bridge building and maintenance which besides improving local infrastructure, provides an alternative source of employment and income to the local communities.

The Company’s other on-going and previous community involvement initiatives at Songwe Hill includes a training program for Malawian graduate geologists and training provided to sampling assistants, donations of educational and sporting equipment to local schools and a seed bank and tree planting programs.

“It is unique for a mining investor who is only at an     exploration stage to adequately invest in CSR as Mkango is doing. As government, we very much appreciate Mkango’s role as a role model corporate citizen and we encourage other companies to borrow a leaf from them,” said Kutsaira.

In their tour of the project, the Minister and the Deputy visited the exploration site at Songwe Hill, inspected the drill core samples, and later visited Changa Primary School to appreciate Mkango’s CSR interventions.

Lemon said the company will continue with its CSR programme as it is integral to the vision of Mkango which is to transform and empower the lives of rural communities especially in areas where the company is operating.

“We hope one day to have some geologists, mining     engineers and other professionals emerging from our group of scholarship students to contribute to the development of Phalombe district and the warm heart of Africa – Malawi,” he said.