Government, Lotus meet over Kayelekera
The government and Australia-based exploration company, Lotus Resource Limited, are expected to meet today for discussions over possible re-opening of the Kayelekera Uranium Mine.
Both Minister of Mining Albert Mbawala and Lotus Director Grain Malunga have confirmed the development.
The government suspended talks with Lotus Resources Limited, a company that took over ownership and management of Kayerekera Uranium Mine, following continued disagreements over the Mining Development Agreement.
In an interview, Malunga said the negotiation is on-going but there are a number of issues that must be addressed before the mine is re-opened.
“We are looking at government’s shares in the mine; currently, the government holds 15 percent but the Act provides that the government should own 10 percent of the shares. So we will discuss what happens with the remaining 5 percent.
In a separate interview, Mbawala said the meeting aims at charting the way forward for a possible reopening of the mine.
“We are now negotiating a Mining Development Agreement and we are at an advanced stage so that Malawi gets a better deal from the mine,” Mbawala said.
Representatives of Lotus previously indicated that they would reopen Kayelekera mine if uranium prices had risen to above $60 per pound and were anticipating joining the market this June.
However, according to trading economics. com, uranium futures rose to above $51 per pound in early June from the three-month low of $46.7 touched on May 24 2022, carried by an increase in demand, higher prices for uranium enrichment and expectations that physical uranium funds could increase purchasing activity.
Demand from major nuclear energy producer China was seen higher as Covid cases fell and lockdowns in major cities were relaxed. Beijing previously signaled it plans to build 150 new reactors by 2035, placing bets in nuclear energy amid commitments to lower carbon emissions.
Kayelekera uranium mine is an open cast uranium mine, situated 52 kilometers west of the administrative and commercial centre of Karonga, and was the country’s largest mine.
Production at the mine was paused in February 2014 due to a fall in global uranium prices.