This week marks a historic milestone for Malawi’s mining sector as the government, through the Ministry of Mining and the Ministry of Finance, has signed Mining Development Agreements (MDAs) with Lotus Resources Limited and Lancaster Exploration Limited (BVI).
These agreements will facilitate the resumption of operations at the Kayelekera Uranium Mine in Karonga and the initiation of Rare Earth mining at Songwe Hill in Phalombe. These MDAs are the culmination of nearly two years of diligent efforts and extensive negotiations, including intensive discussions facilitated by the Presidential Delivery Unit (PDU) over the past two weeks.
At the signing ceremony in Lilongwe, Minister of Mining Monica Chang’anamuno emphasized that the agreements are mutually beneficial for the government, the mining investors, and the Malawian people, reflecting shared fundamental interests.
Additionally, the two companies have agreed to list on the Malawi Stock Exchange. Chang’anamuno reassured investors that the government would honour its commitments as outlined in the MDAs and urged the companies to begin mobilizing promptly to start mining activities.
She stated, “The government is committed to providing the necessary infrastructure to support mining activities at Kayelekera and Songwe, and hopes that their resumption will significantly impact the economy.”
Minister Chang’anamuno underscored that mining represents the aspirations of the Malawian people for economic growth, wealth creation, and job opportunities. She also thanked the Government Negotiating Team for their dedication to ensuring the agreements serve the best interests of Malawians. “As we all know, mining embodies the hopes and dreams of the Malawian people for economic growth, wealth, and job creation, in line with Vision 2063 and the Agriculture, Tourism, and Mining (ATM) Strategy championed by His Excellency the President, Dr. Lazarus McCarthy Chakwera,” Chang’anamuno added.
Minister of Finance Simplex Chithyola Banda expressed enthusiasm for signing agreements that will bring substantial financial resources into the country. Lotus Resources Limited is projected to create 450 direct jobs and 200 indirect jobs, with expected annual revenues of $1.6 million in dividends, $20 million in royalties, and other taxes, assuming the uranium price is fixed at $65 per pound.
Regarding the Songwe Project, it is expected to create over 1,200 jobs during the two-year construction period and 500 jobs annually during its 18-year mine life, along with numerous indirect jobs. The anticipated annual revenue from this project is $120.6 million in royalties, dividends, and other taxes.
Alexander Lemon, Director of Mkango/Lancaster Exploration, expressed his gratitude, calling this development a game-changer for Malawi. Additionally, the Managing Director for Lotus, Keith Bowes, expressed excitement and commitment to making Kayelekera operational within the next 24 months.
