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Sovereign Metals Ltd (ASX:SVM, AIM:SVML) 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.
This study highlights the potential for Kasiya to become a major producer of natural rutile and graphite in international markets, with steady-state of production of 265,000 tonnes of rutile and 170,000 tonnes of graphite over a 25-year mine life.
The company expects the project to require low capital expenditure to achieve first production, citing “exceptional” existing infrastructure, which offers cost reductions and provides scalability.
Sovereign’s study also indicated Kasiya will operate at a relatively low cost and high margin due to deposit size, zero strip ratio of soft, friable high-grade mineralisation from surface, amenability to hydro-mining, conventional processing, deposit location and low transport costs.
“Tier-one minerals project”
“The expanded scoping study demonstrates Kasiya is a tier-one minerals project being the largest natural rutile resource and one of the largest graphite resources in the world,” Sovereign Metals managing director Dr Julian Stephens said.
“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.
“The project benefits from existing high-quality infrastructure and has inherent ESG (environmental, social and governance) advantages.
“Natural rutile has a far lower carbon footprint compared to other titanium feedstocks used in the pigment industry, and natural graphite is a key component in lithium-ion batteries – crucial to de-carbonising the global economy.
“Further, the vast majority of power for the planned Kasiya mining operation will be supplied by renewable hydro and solar – giving the mine itself a very low carbon footprint.
“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.”
Sovereign has based the scoping study on conservative commodity price estimates; a long-term rutile price of US$1,254 per tonne compared to the current spot price of over US$2,200 per tonne, and a long-term natural graphite basket price of US$1,085 per tonne, compared to current equivalent of US$1,223 per tonne.
Economic scoping study highlights.
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