Lindian Resources is hailing as a milestone the signing of a new contract for an access road and civil works at its Kangankunde rare earths project in Malawi that it has awarded to leading European construction company Mota-Engil.
The US$1.3 million (A$2.07m) contract is the first Lindian has awarded to advance the Kangankunde rare earths project. The work is expected to take 18 weeks to complete and includes primary highway access, 5 kilometres of internal access and other site works in the lease area.
Lindian awarded the contract to Portugal-listed Mota-Engil following a comprehensive tender process. Since 1990, Mota-Engil has worked on some of Malawi’s biggest engineering and construction projects, including Africa’s largest railway project in the past 50 years.
The group also has experience in port management via its Malawi Shipping Company, which holds four 35-year port concessions.
Lindian views Mota-Engil’s strong reputation for delivering high-quality projects across the globe as pivotal and says its new partnership will reinforce the Kangankunde project’s reputation as potentially one of the most significant rare earth projects in the world.
Recently highlighted as one of the world's most promising rare earths projects due to its high-grade, low-cost potential, Kangankunde is fully permitted and ready for the next phase of its development having just secured a US$50 million (A$80.1m) funding agreement and off-take package from United States-based commodity trader Gerald Metals Group.
The giant project has an initial ore reserve of 23.7 million tonnes with an impressive average grade of 2.9 per cent total rare earth oxides, underpinning a mine life of 45 years.
Studies indicate the project could generate about 15,300t annually of clean, high-grade total rare earth oxides concentrate for a total of 8400t of rare earth oxides and 1640t of the prized magnet rare earths neodymium and praseodymium.
Lindian Resources chief executive officer Alwyn Vorster said: “The award of this contract is an important milestone for Lindian and the Kangankunde project. It will demonstrate to the people of Malawi and the investment market that Lindian is committed to advance the development of the project. The selection of Mota-Engil as our first development partner is an important step which may even lead to their broader involvement in additional work packages over time.”
Lindian management recently met with representatives of the Malawi government and says they have received strong government support for the project, including from the new Mines Minister.
Malawi is one of the world's least-developed countries. Its economy is heavily based on agriculture and it has a largely rural and growing population. Significantly for the region, Lindian’s Kangankunde project offers a means to provide important new local employment and small business opportunities and improve local transport connectivity.
Significantly for its investors, Lindian is in the final stages of securing other key commercial agreements for the project, including a fixed-price contract for a processing plant and a power supply.
The company says it is committed to identifying project funding solutions this quarter paving a way to kick off process plant construction shortly thereafter.
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By Doug Bright
