Rare earth mine set to roll out

Investors in Kangankunde Rare Earth Mine in Balaka, Lindian Resources Limited, have announced plans to start constructing the mine this year with the maiden shipment to China set for the first quarter of 2026.

When operational, the mine is projected to generate $114 million (about K200 billion) per year over a 40- year period, according to a feasibility study report the company released on Monday.

Output is also estimated to increase from the initial 15 000 metric tonnes (MT) to 50 000MT annually, the report said.

From the operations, the Malawi Government will earn $5.56 million (about K9.7 billion) in royalties on top of income tax and other taxes from the rare earth mineral types called neodymium and praseodymium , which are used in high-tech industries for high energy efficiency and renewable energy innovations.

Reads the report in part: “Following the final investment decision or a funding confirmation decision by the company’s board, an18 month timeline is anticipated for design, construction, commissioning, and ramp-up to first producton ship.”

The site, located just five kilometres from the M1 in Balaka, will be powered by Electricity Supply Corporation of Malawi with three megawatts.

Mining expert Grain Malunga said the  rare earth industry presents a huge opportunity to the economy as the world transitions to renewable energy and energy efficient technologies as the mineralis key resource in those areas.

However, he bemoans lack of investment by Malawians in mineral exploration,saying it limits benefits from the minerals.

Said Malunga: “These companies are investing a lot in exploration, risking their resources. Government should considering equity investment and not depend on the free equity [of up to 15 percent] as prescribed in the law.

“Government cannot have the negotiating power when it doesn’t invest in the exploration.”

However, he said with the law providing local listing of mining companies, Malawians will have an opportunity to invest through the Malawi Stock Exchange.

Natural Resources Justice Network chairperson MacBowman Mulagha said the civil society has highhopes in the mining ventures, but was quick to add that there are issues that need ironing out for maximum benefits.

He cited the five percent share of community benefit which he says needs to be clarified to communities who are less knowledgeable; hence creating misunderstandings with companies.

China dominates the rare earth industry, leading in production, supplying 75 percent of global output atthe mine level as the global rare earth industry is estimated at $7.4 billion, according to the feasibility study.

With demand of rare earth increasing over the next two decades, the vast majority of projects nearing construction phase are inhibited in high capital costs, low quality and high radioactivity.

However, Lindian Resources says in the report that the Kangankunde project is beating all these challenges, making it one of the most economic project in the world.