Sovereign Metals Ltd has fielded “exceptional economics” with low capital and operating costs and high margins in an expanded scoping study for the Kasiya Rutile Project in Malawi.
The firm announced that its expanded scoping study based on its April mineral resource estimate (MRE) confirmed that Kasiya would be one of the world’s largest and lowest cost producers of natural rutile and natural graphite, with a carbon footprint significantly lower than present alternatives.
Sovereign Metals added that the project would also substantially contribute to the economic and social development of Malawi. The company highlighted a major increase in post-tax NPV by 79% to $1.5 billion and a 101% surge in EBITDA to $323 million from its initial scoping study in 2021, with 10% lower operating costs at $320 per tonne produced for a relatively small increase in capex of 12% to $372 million to first production.
The mining firm also mentioned a life of mine revenue increase of 92% to $12,038 million, and confirmed a steady state production of 265,000 in rutile and 170,000 tones in graphite from a 25-year mine life, with significant cost reductions on the back of existing infrastructure.
The group further noted high margins alongside its low operating costs, as well as extremely favourable market fundamentals due to the high demand for rutile and natural graphite in the US and EU based on high economic importance and supply risk.
“The Expanded Scoping Study demonstrates Kasiya is a Tier 1 minerals project being the largest natural rutile resource and one of the largest graphite resources in the world. Both minerals are classified on the Critical Minerals lists of the US and EU and rutile is in extreme market supply deficit. In light of these factors, Kasiya is seen as a highly strategic project with the potential to be a major supplier in both rutile and graphite markets,” said Sovereign Metals managing director Dr. Julian Stephens.
“The future development of the Kasiya Rutile Project will bring substantial benefits to Malawi in terms of GDP, royalties, taxes, employment and training, local business opportunities and community development,” Dr. Stephens added.