Lindian Resources is one step closer to owning its Kangankunde rare earths project in Malawi after completing the third of four tranche payments required as part of the deal to acquire the site’s current owner Rift Valley Resources Developments.
With the latest $US10 million ($AU14.75 million) transaction, a total of $20 million ($AU29.5 million) has been paid to Rift Valley, with a fourth and final tranche payment of $US10 million still to come. The last sum is due to be paid by the end of July in 2026 or upon commercial production at Kangankunde, whichever comes first. However, the buyer has the right to make the remaining tranche payment sooner if it so chooses.
Following the latest transaction, Lindian is now the legally-registered owner of 67 per cent of the issued share capital of Rift Valley, with the final 33 per cent to be transferred and registered once the last tranche has been paid.
Kangankunde is considered one of the world’s biggest rare earths operations outside China and hosts an outdated resource of 2.53 million tonnes, grading 4.24 per cent total rare earth oxides (TREO) for 107,000 tonnes of contained rare earths when using a cut-off grade of 3.5 per cent. It is a carbonatite-hosted system with mineralisation exposed at surface and it is still open at depth.
Earlier this month, Lindian successfully raised $35 million to set itself up to make the third and fourth payments to acquire Rift Valley. The cash came from new and existing institutional and sophisticated investors, who subscribed for more than 106 million fully-paid ordinary shares at 33 cents each.
Lindian Resources executive chairman Asimwe Kabunga said: “The completion of the Tranche 3 payment establishes the framework for the project’s next phase of development, and facilitates the deployment of resources towards near-term value drivers, commencing with reporting of the maiden Mineral Resource Estimate (MRE) imminently, assays from the two deep diamond drill holes which will lead to the reporting of a broader Exploration Target for Kangankunde, and regular updates on the construction and development of the Stage One on-site processing plant.”
The company recently completed the first-phase drill campaign at its Malawi operation, covering more than 12,500m and including 81 reverse-circulation (RC) holes, in addition to 10 core drill holes including six core tails over 1642m.
In March, the explorer recorded a 3m hit at a whopping 15.6 per cent TREO from 69m. The high-grade intercept is contained within a bigger 26m section grading 6.15 per cent TREO from 58m and includes a 1m segment at a head-turning 18.76 per cent TREO from 71m.
Management is also expecting the results from its phase-two drill program that includes two deep drillholes to a depth of 1km. It is keen to understand the depth of the operation after several phase-one holes ended in mineralisation.
Considering the time and effort Lindian has put into Kangankunde – and the results it has received to date – there is little wonder why it is so keen to take full ownership of the exciting Malawi operation.
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By Michael Philipps
