By Wahard Betha
A study done by an independent expert on logistics and infrastructure solutions for the Kasiya rutile project has confirmed Nacala Logistics Corridor (NLC) as preferred logistics route to haul the product to the world market.
The Kasiya deposit, which is being developed by ASX-listed group Sovereign Metals, is one of the largest undeveloped natural rutile deposits in the world located in central Malawi less than 50km from its capital city Lilongwe which provides exceptional benefits from the existing infrastructure available.
Sovereign Metals Managing Director Julian Stephens explains that the study has confirmed the NLC as reliable, efficient and high standard logistics solution with excellent existing infrastructure.
Stephens commented: “The exceptional established infrastructure in Malawi should result in a positive capital and operating cost outcome for Kasiya.”
“The availability of existing road, rail and port infrastructure for product export and project supplies’ imports provides a huge advantage for our world-class Kasiya Rutile Project.”
He explains that Sovereign will directly benefit from the exceptional existing infrastructure in central Malawi, which offers the preferred logistics route to the Nacala deep-water port in Mozambique through the Nacala Corridor for the export of mineral products to global markets.
Stephens also says established operation-ready logistics infrastructure provides significant capital and operation costs savings to the Company as the project continues posing a greenlight.
“By adopting the Nacala Rail Corridor as its preferred logistics solution with almost all overland distance on rail, Sovereign has the potential to reduce environmental impact and carbon footprint of Kasiya significantly compared to all-road alternatives,” says Stephens.
Sovereign has an existing Memorandum of Understanding (MoU) with regional rail operator Central East African Railways (CEAR) now named Nacala Logistics, for rail freight, port access and port handling services and is continuing with discussions for increased volumes based on the outcomes of the Company’s forthcoming Scoping Study for Kasiya.
The rail line of the NLC passes through Sovereign’s licence areas with established access via a short haulage to the rail head at the underutilized operational intermodal rail siding at Kanengo located ~50km from Kasiya.
NLC line also passes across the southern end of sovereign’s Nsaru mineralized envelope and is just 20km from the central part of Kasiya.
Meanwhile, Sovereign is assessing the possibility of establishing its own rail siding as a logistics option as part of the current Scoping Study to reduce haulage and potentially reduce operating costs.
The NLC is a 912km rail line for the purpose of transporting coal from mines in western Mozambique to the port of Nacala via Malawi.
For Malawi, the NLC provides the shortest and most direct access to the sea and global commodity markets.
The Corridor stretches from Moatize in Mozambique to Chipata in Zambia and passes through Lilongwe in Malawi to the Port of Nacala on the Indian Ocean.
Development of the NLC was essential for the expansion of global miner Vale SA (Vale) & Japanese conglomerate Mitsui & Co.’s (Mitsui) coal extraction activities in the Tete region of Mozambique.
In January 2021, Vale acquired Mitsui’s interest in the Moatize mine and the NLC to become the wholly owner of the operation.
NLC transported a daily average of 16,000Mt of coal and 1,150Mt of other cargo, operating a fleet of 101 locomotives and 2,677 wagons in 2020.
The landmark infrastructure project was driven by the governments of Malawi, Mozambique and Zambia, Vale, Mitsui, a consortium of several international and African banks and export credit agencies including the Japan Bank for International Co-operation, Nippon Export and Investment Insurance and African Development Bank.
Specifically, the governments of Malawi, Mozambique, and Zambia have gradually increased their investment in the NLC to approximately US$758 million, with support from the European Union, AfDB, the Japanese International Cooperation Agency and the Export-Import Bank of Korea.
The railway in Malawi is operated by Nacala Logistics who manage and control the NLC on behalf of the Joint Venture.
NLC has a capacity of 4-million tonnes of general cargo annually through Malawi and now they are actively seeking new freight customers.
Sovereign’s ground largely occurs within a 75km radius from Malawi’s capital city of Lilongwe and provides the Company with excellent access to sealed roads and short haulage distances to rail and future inbound and outbound of operational consumables and critical parts.
Kasiya is perfectly located to utilize the Class-1 bitumen road network which directly accesses the deposit area.
In 2015, The Roads Authority of Malawi completed an upgrade of the 95km long, Lilongwe Old Airport-Kwanyanda-Santhe (S117) and Kasiya spur (T342) road projects.
These upgrades resulted in Class-1 bitumen standard roads to 6.8m carriageway with 1.5m single sealed shoulders.
Sovereign will be able to take advantage of this underutilized road network for inbound and outbound logistics with any potential development.
The Company recently announced results of a maiden Minerals Resources Estimate (MRE) study on its flagship Kasiya rutile tenement which confirmed the deposit as one of the largest natural rutile deposits in the world.
Stephens explained that the results of the study proved that Kasiya is a strategic and globally significant natural rutile discovery.
He said: “It is a remarkable result to achieve the maiden JORC mineral resource estimate of this scale, grade and global significance in under 18 months since discovery.”
“We believe this maiden resource is just the beginning and expect to upgrade and expand the resource over the coming quarters.”
“The Company is surging forward with the Kasiya Scoping Study which will target a large-scale natural rutile operation to help address the supply deficit and reduce the titanium industry’s environmental footprint.”
The study results also confirmed that Kasiya natural rutile is the purest, highest-grade natural form of titanium dioxide (TiO2) and is the preferred feedstock in manufacturing titanium pigment and producing titanium metal.
Titanium pigments are used in paints, coatings and plastics; and have also specialty uses including in welding, aerospace and military applications.
Stephens said the latest results give his Company strength to scale up studies to expand the tenement, which will later see the Company supplying the global market with high grade natural rutile.
Comparing Kasiya to the other major rutile-dominant resources, the Lilongwe deposit sits within the top two largest natural deposits alongside Sierra Rutile.
Stephens forecasted that further near-future resource growth could see Kasiya potentially becoming the largest and preeminent rutile deposit globally, with Central Malawi potentially becoming the largest rutile province in the world.
He said the advantage of the project is that it is being developed at an opportune time when current sources of natural rutile are in decline as several operations’ reserves are depleting concurrently with declining ore grades. These include Iluka Resources’ (Iluka) Sierra Rutile and Base Resources’ Kwale operations in Kenya.