[Malawi] Mkango Resources and Talaxis in deal to fund development of the Songwe Hill Rare Earth project
Mkango Resources Ltd has entered into an agreement with Talaxis Limited, a wholly owned subsidiary of Noble Group Limited to fund development of the Songwe Hill Rare Earths Project in Malawi and commercialisation of new magnet technologies.
According to the agreement, Talaxis has agreed to fully fund a bankable feasibility study for Mkango's Songwe Hill Rare Earths Project in return for a 49% interest in the project
Talaxis will invest £12 million in the Project for the BFS in three tranches, with the first tranche of £2 million invested on receipt of regulatory approval Talaxis will also have the option to acquire a further 26% interest in the Project by arranging funding for Project development.
Upon completion of the investments, Mkango will retain a 25% interest in Songwe, free carried to production, and a 51% in interest in the new venture Talaxis and Mkango have agreed to cooperate as preferred partners on rare earths projects worldwide and on other projects in Malawi
William Dawes, Chief Executive Officer of Mkango, said: "This transaction is transformational for Mkango and for Malawi, and is a further endorsement of the Company's strategy and potential. This Agreement significantly strengthens our balance sheet whilst ensuring that the Company is fully funded to progress Songwe and our collaboration with Metalysis. It also comes at a pivotal time in the rare earth market with a very strong demand outlook for rare earths such as neodymium and praseodymium used in permanent magnets for electric vehicles, wind turbines and other clean technology applications. We are very excited to be working with Talaxis, and moving forward with the bankable feasibility study for Songwe and Phase II of the research and development programme with Metalysis."
Daniel Mamadou, Executive Director of Talaxis added: "The global push to decarbonize the economy is creating pressure on the supply of critical elements to the green tech sector. Environmental regulation and the policy changes are driving the price of technology metals. Supported by our access to global logistics capabilities, an extensive marketing network and a team of experienced professionals, Talaxis is pleased to enter into this agreement, which further strengthens our supply chain specialized in tech metal products."