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Mkango completes exploration works

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Lancaster Exploration Limited, a subsidiary of Canadi-based Mkango Resources Limited, has indicated that it has completed exploration works and a feasibility study for mining of metals such as neodymium, praseodymium, dysprosium and terbium at Songwe hill in Phalombe District.

However, the company is still looking to conclude negotiations and terms over a Mining Development Agreement (MDA).

An MDA is a contract that governs the relationship between the government and a licence holder for the exploration of a certain area of land, for minerals or for the mining of minerals, in exchange for royalties, taxes and other obligations.

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This came to light when Minister of Mining Albert Mbawala visited its site in Phalombe over the weekend.

The company’s managing director Alex Lemmon said, oftentimes, exploration projects take up to 20 years considering complicated processes employed to find the minerals.

“All of the exploration has been completed on the site; we have completed the environmental impact study which covers social and community health care; we have also completed the definitive feasibility study that is undergoing final checks and will be launched soon.

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“We are working closely with the Ministry of Mining, Ministry of Finance and the Ministry of Justice so that we can complete the MDA and build a fantastic development project for Malawi.

“We are working in parallel on the financing; we have invested over $25 million to date. We have got huge backing from our investors and we are working with banks; we have had meetings with development and commercial banks in the past 12 months and we are aiming to have finances in place by the end of this year,” Lemmon said.

He added that the company is contemplating establishing a 25 megawatt solar farm to complement energy supply once mining operations commence.

Mbawala said he is already engaging colleagues in the Ministry of Energy to ensure that mines in the country are supplied with electricity from the national grid on the back of connectivity to the Southern Africa Power Pool.

“We have taken a long time to conclude the MDA because these people are coming from a different legal framework in Europe and the Americas but we operate with our own legal framework; so, they felt it was lacking in some areas but we have stood our ground and that we can only incorporate necessary propositions in the agreement. We expect to conclude the MDA with Mkango Resources in the next four weeks so that we go into signing,” Mbawala said.

Recently, players in the mining industry indicated that the country has a long way to go before it starts reaping fruits from the sector, if mining operations are not supported with cheap electricity, such as from the national grid.

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