Rare earth miner gets special permit for Kwale site
Kaya elders from Mrima support niobium mining by Cortec, the subsidiary of Pacific Wildcat, last year. The firm has got a 21-year permit. Photo/Laban Walloga
What you need to know:
The licence clears Pacific Wildcat Resources to start commercial exploration on the 142-hectare site.
The firm will pay a three per cent royalty on the gross sales of niobium and five per cent for rare earth, according to the licence.
The permit also demands that the firm adhere to environmental conservation.
A Canada-based mineral firm has been awarded a 21-year special mining licence to explore and develop its earth and niobium project in Kwale County.
The licence issued by the Mines and Geology Department clears Pacific Wildcat Resources to start commercial exploration on the 142-hectare site.
The firm will pay a three per cent royalty on the gross sales of niobium and five per cent for rare earth, according to the licence awarded to its local subsidiary Cortec Mining Kenya Ltd (CMK).
“We are extremely pleased with the awarding of this special mining licence to CMK. The awarding of this licence reaffirms Kenya as a great destination for mining investment and we look forward to continuing to work successfully with the Government to rapidly advance the Mrima Hill niobium and rare earth project,” Pacific Wildcat President and CEO Darren Townsend said.
The permit also demands that the firm adhere to environmental conservation. Niobium is mixed with steel to create an alloy used in the construction of pipes for water and sewage systems and vehicle components.
Rare earths are vital in manufacturing high-tech electronics products such as specialised miniature nuclear batteries, laser repeaters, super conductors and miniature magnets. A global scarcity of rare earth has kept prices high.
China, which accounts for an estimated 97 per cent of global rare earth supplies, has been tightening trade in strategic metals, leading to an increase in prices. Japan, which accounts for a third of global demand, has been hard-hit by scarcity and has been looking to diversify its supply sources.
Mr Townsend said the firm would put up a mineral ore processing plant at the site once the deposits have been developed. Pacific Wildcat said tests had established the presence of high grade deposits of rare earth on Kiruku Hill, just three kilometres from its current Mrima Hill project site.
Last week, the firm said it plans to raise an additional Sh123 million to finance the ongoing work at its rare earth and niobium project near Mombasa. The amount will be raised through a non-brokered private placement, Mr Townsend said.
“The proceeds from the private placement will be used to fund additional resource definition work including the preparation of an inaugural national instrument on total rare earth resource at the Mrima Hill Project, advancing metallurgical work on the Mrima Hill Project and for general working capital purposes,” he said.
In September, Pacific Wildcat completed the acquisition of stake in a rare earth and niobium project near Mombasa. In the deal, the company took over Stirling Capital Limited Cortec Ltd and indirectly acquired a 70 per cent interest in Cortec Mining Kenya Limited, the owner of the Mrima Hill niobium and rare earth project.
Kenya plans to review the fee structure and set specific charges for each mineral away from the current policy that levies at the rate of three per cent of a contract’s value for all minerals.
