• Initial capital cost for the Songwe Hill project increased to $297.8 million from $277 million.

• The project targets payback in 3.4 years and annual output of 5,954 tonnes of rare earth oxides.

• Mkango Resources plans a Nasdaq listing to attract U.S. investors amid strong Western demand for critical minerals.

Malawi has seen the initial capital cost of the Songwe Hill rare earth project rise to $297.8 million, compared with $277 million previously.

Mkango Resources disclosed this revision in its definitive feasibility study published on Thursday, March 19. The company aims to position the asset as a future source of critical minerals essential to the energy transition.

The study forecasts a payback period of 3.4 years from the start of full production. The project plans to develop a mine with a lifespan of 18 years. It targets average annual production of 5,954 tonnes of rare earth oxides during the first five full years of operation.

This concentrate will include neodymium, praseodymium, dysprosium, and terbium. These elements play a critical role in manufacturing permanent magnets used in electric vehicles and wind turbines.

Mkango Resources intends to position Songwe Hill as the main supplier to its planned refining plant in Puławy, Poland. However, the company has not yet finalized the project’s financing structure. It has secured support from the United States, including recent funding from the U.S. International Development Finance Corporation, which is also considering a loan of up to $100 million.

While the project has attracted interest from the European Union, Mkango is increasingly targeting the U.S. market as its primary investment base. The company plans to combine Songwe Hill and its Polish plant into a new entity through a merger with Crown PropTech Acquisitions. The transaction, expected this year, should include a listing on the Nasdaq. The company aims to increase exposure among U.S. investors.

Western economies, including the United States, the European Union, and Japan, are seeking to secure rare earth supplies outside China. In this context, Songwe Hill appears well positioned to benefit from shifting geopolitical dynamics. However, the company has not yet announced a timeline for production.

This article was initially published in French by Aurel Sèdjro Houenou

Adapted in English by Ange J.A de Berry Quenum