Globe scouts for buyer for Kanyika niobium – Mining & Trade Review (November 2015)

The piece “Globe scouts for buyer for Kanyika niobium” featured below was initially published in Malawi’s Mining & Trade Review Issue Number 31 that is circulating this November 2015.

The full edition is available for download here. This monthly publication is edited by Marcel Chimwala.

2015-10 Mining & Trade Review Neville Huxham

Globe scouts for buyer for Kanyika niobium

By Marcel Chimwala

Africa-focused resources group, Globe Metals and Mining, says it is seeking buyers for the niobium which it wants to start mining at Kanyika in the district of Mzimba.

Globe Metals and Mining Managing Director Neville Huxham tells Mining & Trade Review that the signing of pre-purchase contracts will be a significant step for the company to secure financing for mine construction, which is estimated to cost US$450-million.

We are optimistic that financing for the project will be realized once potential buyers for the resources are identified. The agreed price will also determine the profitability of the project taking into account interest rates that will be charged by the financiers,

says Huxham.

He says Globe, which had earlier hoped to acquire project development financing from Chinese financiers, is currently talking to local banks which are expected to syndicate with   international banks to provide funding for the mega project.

We earlier expected to rope in Chinese financiers but with the economic slowdown in China, we feel chances of sourcing funding from that country are somehow slimmer. We are, therefore, talking to local financiers to consider giving us loans to develop the project, and this will be easy if we identify a ready market for the products,

he says.

Giant financial institutions including Standard Bank and National Bank of Malawi already expressed interest to finance mining projects.

Said Standard Bank’s CEO Andrew Mashanda in an earlier interview:

We are always ready to finance business ventures with an established business plan and viable outlook. Because of our history as a mining bank and our enduring expertise in this sector, we work to understand our client’s individual requirements. We coordinate and execute our client’s financing and banking requirements across Africa and emerging global markets. Our highly regarded commodity and currency trading desks offer 24-hour trading capabilities to support price-risk management and hedging strategies.

In addition, we carry out in-depth analyses of commodity trends and stay on top of the latest developments in the mining and metals industry. We continue to play a leading role in arranging facilities for many of the most significant mining projects in Africa and other key emerging markets.

The Malawi Government earlier this year granted a mining licence to Globe to develop the Kanyika Uranium prospect. However, Globe can only start executing mine construction works after concluding negotiations with the government on the development agreement.

Globe submitted a draft development agreement to the Malawi Government, which is a replica of the development agreement for Paladin’s Kayelekera Uranium Mine in Karonga which gave the government 15% shareholding in the mine in exchange for a reduction of royalties from the prescribed 5% to 3%.

The Malawi law also subject mining proceeds to a fixed income tax of 30%.

Globe Metals and Mining, which is listed on Australian Stock Exchange, has spent over US$15-million in exploration and feasibility studies to develop the Kanyika deposit, which besides niobium contains uranium and tantalum.

China Mineral Exploration and Development Bureau is a major shareholder in Globe Metals and Mining with 75% shareholding while the rest of the shares are held by Australian investors.

Niobium is one of the most important metals of the space age as the metal is found in various ‘outer space’ applications, including space rocket jet engine components, rocket subassemblies, and in the advanced air-frame systems in the Gemini space program.

Niobium is also used in manufacturing special steels for gas pipeline construction and in nuclear industries, electronics, optics and production of coins.

4 responses to “Globe scouts for buyer for Kanyika niobium – Mining & Trade Review (November 2015)

  1. Amazing staff, its very exciting for Malawi, im impressed, i believe in the beauty of Africa we are not low class people we have what it takes to change the continent if we work together we can achieve much, Africa its possible for you to become a Power house, first world continent, they made us believe without them we cannot make it, we’ve been told being black is very bad and unfortunatly we believed it. We are a generation which cannot be destroyed. We need to stop being ignorant, and raise a generation of Power

  2. Pingback: Link Roundup for Extractive Industries in Malawi: November 2015 | Mining in Malawi·

  3. Pingback: Link Roundup for Extractive Industries in Malawi: November 2015 | Mining in Malawi·

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