The sale of Kayelekera Uranium Mine is likely to delay as government is reportedly seeking more information about Paladin Energy’s proposed sale of its mine’s interest to Lotus Resources.
According to online mining news website, www.kitco.com, the Minister of Natural Resources, Energy and Mining wrote the company asking for more information on the mine projects and prospects before it is granted consent on the sale.
The publication said the remaining obligations, among others, include the provision of further tax reporting information, corporate social responsibility and environmental assurances and responses to labour-related queries.
Paladin Energy consultant on Kayelekera Uranium Mine, Grain Malunga also confirmed receiving advice from the government seeking additional obligations to be met prior to consent being granted to sell the mine.
However, Malunga was quick to state that government already has the information as it is a shareholder of the company and was being updated from time-to-time on the calendar of events and projects undertaken by Kayelekera Uranium Mine.
He said: “Government is very well knowledgeable on operations and has the information it is looking for. On tax information, for example, our records are clean and clear, government may wish to confirm this with the Malawi Revenue Authority. We have also done various corporate social responsibility [CSR] programmes and government is aware of this too.”
On the state of employment for the staff, Malunga without committing to job security of employees said Paladin Energy is not closing the mine rather leaving the Malawi market which means operations would still continue.
Paladin Energy Limited, the operators of Kayelekera Uranium Mine in Karonga, announced in July this year, they are leaving the Malawi market following a decision by the firm to sell its 85 percent interest in the mine to Hylea, a subsidiary of Lotus Resources, a joint venture with Chichewa Resources.
A well placed source in the Ministry of Natural Resources, Energy and Mining told Business News on Wednesday that government is only trying its best to act in accordance with its statutory obligations to ensure that the sale of the mine does not prejudice public interest.
He said: “Indeed we are requesting Paladin this additional information for a sole reason that we are ensuring government handles this matter without violating any statutory and contractual obligations. That being the case, should they fail to provide these, no progress can be made on the sale.”
Paladin suspended mining at Kayelekera in 2014 following a slump in global uranium prices. The mine has since remained on care and maintenance as directors anticipated a pickup in global uranium prices.
The stake in Kayelekera, according to Paladin will be sold for $5 million (about K3.7 billion), comprising $200 000 (about K148 million) in cash and $4.8 million (about K3.5 billion) in Hylea shares which will be issued to Paladin.