PERTH (miningweekly.com) – ASX- and Aim-listed Sovereign Metals has struck a non-binding memorandum of understanding (MoU) with Japanese trader Mitsui & Co to establish a marketing alliance and offtake for 30 000 t/y of natural rutile from the Kasiya rutile project, in Malawi.
Under the MoU, the two companies will form a marketing alliance to jointly market Sovereign’s rutile across Asia and other markets. The alliance will allow Sovereign to leverage off Mitsui’s extensive network and their market-leading understanding of the titanium industry and global logistics.
Mitsui has shared samples of rutile product from Kasiya with Asian end-users that have confirmed its premium chemical specifications should be suitable for use in their titanium sponge and pigment processes, as a precursor for high-grade, high-specification titanium metal and pigment production.
“The Asia region is a key natural rutile market with all major end-use sectors well established and further strong growth forecast. We expect expanding technology developments and increasing environmental awareness to drive greater demand for natural rutile,” Sovereign MD Dr Julian Stephens said.
“This marketing alliance with a very high-calibre partner in Mitsui will assist Sovereign to penetrate these ever-growing markets.”
The MoU is non-exclusive and non-binding with no pricing terms, which remains subject to negotiation and execution of a definitive agreement. The MoU will expire at the end of December 2023 but can be extended by agreement by both parties should a definitive agreement not have been reached by that time.
An expanded scoping study into the Kasiya project recently confirmed that the project would require a capital investment of $372-million to first production, and could generate life-of-mine revenues of over $12-billion, based on the production of 265 000 t/y of rutile and 170 000 t/y of graphite and a mine life of 25 years.
Stage 1 of the project would consist of a 12-million-tonne-a-year operation, producing approximately 145 000 t/y of natural rutile and 85 000 t/y of flake graphite over the first five years of the operation, while Stage 2 would add a further 12-million tonnes to the circuit, to produce approximately 260 000 t/y of natural rutile and 170 000 t/y of flake graphite.