Dependence on diesel-powered generators as a source of power is having a toll on operations of Kayelekera Uranium Mine in Kronga, it has emerged.
Lotus Resources Limited, owners of the mine, acknowledged this in an annual report for the financial year ended June 30 2025, which highlighted key developments achieved, including the resumption of Kayelekera operations, securing of four off take agreements and raising of equity.
Among others, it said the restarting of production at Kayelekera, which reduced capital expenditure of its first uranium production from $88 million (K154 billion) to $50 million (K87.5 billion) is facing high operational costs, but described it as shortterm.
Reads part of the report: “To achieve our accelerated time-frame, we are using our back-up power solution for commissioning and ramp-up, which will result in a short period of higher operating costs associated with diesel consumption.
“Our grid connection is underway with grid power expected late in second half of 2026. We will utilise imported sulphuric acid until refurbishment of the acid plant is complete in first half of 2026. Again, for a brief period, this will result in higher operating costs associated with trucking sulphuric acid.”
But Lotus Resources Limited managing director Greg Bittar was quoted in the report as having said the company, which signed four binding off-take agreements to sell uranium between 2026 and 2029, is working on how to optimise logistics to markets and invest in long-term infrastructure that would minimise operational costs from next year.
He said: “With first production from Kayelekera achieved, we are now focused on optimising logistics of product delivery to the uranium converters, where our customers, some of the leading power utilities in the world, take ownership.
“This will provide the company with revenue cash flows from first half of 2026. We are also investing in long-term infrastructure to minimise life-of-mine operating cost at Kayelekera, including the grid connection, where Lotus has awarded fixed price contracts for transmission and substation infrastructure, and preparing the tailings storage facility for a 10-year life-of-mine.”
Electricity Supply Corporation of Malawi (Escom) chief operations officer Maxwell Mulimakwenda, while acknowledging that the mine restarted before being connected to Escom grid, said the delays have nothing to do with the sole power supplier.
He said: “Firstly, as you know they [Lotus] had to conduct environmental and social impact assessment on the route through which the power line and other electricity infrastructure would be constructed and the route had to be diverted to protect some special species.
“But again, through the deal, Lotus is financing all that infrastructure. We will only connect the electricity upon the completion of construction and the agreement is that we will be deducting the costs from the tariffs.”
Commenting on Escom’s capacity to supply enough power for the mining project, Mulimakwenda said Lotus applied for 7.5 megawatts (MW), which can easily be supplied considering that it will be getting 50MW from Mozambique through interconnector project, which will be commissioned this year.
Among others, Lotus Resources plans to link the mine through a new 66 kiloVolt transmission line and a substation built on-site.
The firm is funding the project exclusively under a $20.6 million (about K36 billion) initiative called Project Powerline.
Upon commissioning, the facilities’ ownership will be transferred to Escom, which will then supply power to the mine.
The agreement spans for 10 years, allowing Lotus Resources Limited to terminate the pact early with a 30-day notice.
Geologist Ignatius Kamwanje, who previously worked at Kayelekera Uranium Mine, said in an interview that although the diesel backup is critical considering the unreliability of Escom electricity, running the diesel power stations could be costly.
Lotus Resources devised a hybrid electricity supply system, which will see Escom power being the main source of energy, complemented by its co-generating system and solar power, leaving only 10 percent of the electricity shortfall that will be generated from the diesel generators.
