Name of the Project
Malingunde saprolite-hosted graphite project.

Location
The deposit is located at Malingunde, just 15 km south-west of Lilongwe, Malawi’s capital city.

Client
Sovereign Metals.

Project Description
The results of a scoping study have demonstrated the potential for the Malingunde project to support a very low capital- and operating-cost operation, with a graphite concentrate production of about 44 000 t/y over an initial mine life of 17 years. This equates to an average of about 475 000 t of ore processed a year, totalling about eight-million tonnes grading 10.0% total graphitic carbon (TGC) over the life-of-mine (LoM). There is significant opportunity to increase the mine life beyond 17 years by processing lower-grade material or through the discovery of additional high-grade resources within reasonable trucking distance to the proposed processing plant.
 

The scoping study is based on the maiden mineral resource estimate (MRE) for the Malingunde deposit reported in April 2017, which comprises 65.1-million tonnes grading 7.1% TGC (saprolite, saprock and fresh rock). The MRE includes a high-grade saprolite component of 8.9-million tonnes grading 9.9% (7.5% TGC cutoff), which is the focus of the study.
 

The geometry of the Malingunde deposit is one of several high-grade, shallow to moderate north-east-dipping mineralised zones. Sovereign is targeting the near-surface, soft saprolite portion of the resource to a maximum vertical depth of about 25 m. This results in several long, shallow openpits in the mining plan.

A contract mining strategy has been selected to mitigate project risk, although operational management will be retained by company personnel.

The tailings management facility (TMF) for the project has been designed to safely contain the LoM estimated tailings of 7.3-million tonnes. The characteristics of the tailings produced have not yet been confirmed and, therefore, a conservative approach to the deposited density has been adopted assuming a final settled density of 1.15 t/m³.

The strategy includes a fully high-density polyethylene- (HDPE-) lined facility, leaving the option for a non-HDPE-lined facility or inpit deposition as an opportunity that could be used, should future testing of the materials prove that contamination is not an issue.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The project has an estimated payback of two years.

Value
Total capital costs have been estimated at $29-million.

Duration
The project could start construction in 2019, with production likely to start in late 2019 to early 2020. This timeframe is subject to normal economic, environmental, financing and permitting factors.

Latest Developments
AECOM has won the bid for social services for Sovereign Metals’ Malingunde graphite project.

AECOM received a request for proposal in April from Sovereign Metals’ environmental assessment practitioner (EAP) Dhamana Consulting, which is based in Perth, Australia.

Three consulting firms were approached, based on industry intelligence and recommendations from other professionals in the field.

Dhamana Consulting is the environmental- and social-impact assessment (ESIA) service provider, while AECOM is conducting two of the more than ten specialist studies, in addition to the stakeholder engagement for the ESIA process.

AECOM’s scope of work encompasses stakeholder engagement, social-impact assessment (SIA) and the drafting of a resettlement action plan (RAP). These components, part of the ESIA process, are regulated by Malawian legislation, which mean that there are specific legal requirements to be met in this regard.

Sovereign Metals has opted to conduct these studies to conform to financial institution the International Finance Corporation’s (IFC’s) performance standards, as well as the United Nations’ Equator Principles. In the event of applying for funding, she explains, these standards serve to mitigate investment risks for financial institutions.

“Conducting studies to these standards is usually an indication that the ESIA considered everything it should have, and that appropriate mitigation and management measures have been developed to minimise the project’s impact on the people and their environment,” AECOM senior senior specialist Karien Lotter has elaborated.

The RAP will be submitted to the Ministry of Lands, Housing and Urban Development for comment and approval. The RAP sets out the way in which displaced people will be compensated for losses, physically relocated if required and how livelihoods will be restored.

The extent of physical and economic displacement in collaboration with Sovereign Metals is being investigated. The aim is to reduce displacement by, among other aspects, working with the team undertaking the feasibility studies to ensure that social- and environmental-impacts are considered during the design phase.

The RAP serves as a mitigation measure to address the impact of land acquisition required by the project. During the RAP process, all landowners and users who might be affected by land acquisition, as well as their assets, are identified. Assets are mapped in collaboration with the Department of Lands. Full replacement costs are calculated using a market-asset valuation assessment.

Meanwhile, the ESIA process, which AECOM’s scope of work forms a part of, will run for about a year, from November last year. The aim is to submit the ESIA report to the Malawian Environmental Affairs Department late this year, in support of an application for environmental authorisation.
 

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Not stated.

Contact Details for Project Information
Sovereign Metals, tel+61 8 9322 6322, fax+61 8 9322 6558 or email info@sovereignmetals.com.au.