Paladin Energy Limited, operators of Kayelekera Uranium Mine in Karonga, are leaving the Malawi market, an official has confirmed.
The move follows a decision by the firm to sell its 85 percent interest in the mine to Hylea subsidiary Lotus Resources, a joint venture with Chichewa Resources.
According to a published statement which The Nation has seen, the stake in Kayelekera 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 to be issued to Paladin.
Paladin Energy’s consultant on Kayelekera Uranium Mine, Grain Malunga, said in an interview yesterday the development means that Paladin Energy is leaving the Malawi market and that the fate of employees at the mine will rest with the new owner.
He said: “Paladin has two mines under care and maintenance so they want to save resources at Kayelekera to open the Namibia mine because you can’t keep two mines that are not functioning.
“This has already been communicated to government and at the moment, they are waiting for Kayelekera authorities to meet with government on the same.”
Malunga said Paladin Energy has two expatriates and about 30 local managers and technical staff at Kayelekera Uranium whom, he said, may have their contracts renegotiated with the new miner.
Paladin suspended mining at Kayelekera in 2014 following a slump in global uranium prices.
Meanwhile, Kossam Munthali, chairperson of the Natural Resources Justice Network(NRJN), a local non-governmental organisation (NGO), has called for transparency in the sale
He said: “We need to know people behind these ventures, it is a requirement in terms of disclosure. So the first thing Malawians need to know is who [are the new buyers]?”
Asked to comment of the development, Deputy Director of Mines Peter Chilumanga said he needed time to check with the ministry before commenting.
But an official from the ministry, who asked for anonymity, said government will have to assess the impact that the sale would have on the economy.