Base Titanium posted a 12.6 percent decline in sales in the quarter ended March, with the performance linked to lower prices of the minerals ilmenite, rutile and zircon.
Its revenue stood at Sh9.8 billion in the review period, down from Sh11.3 billion a year earlier, according to disclosures by its Australia-based parent firm Base Resources.
The average price per tonne of the minerals exported fell 13.9 percent to $637 from $740, resulting in a revenue drop.
The fall in sales reduced the Treasury’s earnings in the period under review. The company pays the State royalties at a rate of five percent of export sales value.
Export quantities grew by a marginal 1.4 percent to 114,100 tonnes from 112,500 tonnes.
Production declined 13.4 percent to 98,700 tonnes from 114,100 tonnes.
Production of ilmenite dropped by 12,900 tonnes, followed by rutile (2,300 tonnes) and zircon (200 tonnes). Exports often exceed production levels as the firm stockpiles the commodity to, among other reasons, respond to changes in global prices.
The miner said while prices dropped significantly from the year before, they have since stabilised and could rise in the short term, particularly for ilmenite, its largest export.
“New Titanium oxide pigment production capacity continues to come online in China and is expected to generate further demand for feedstock,” said Base Resources.
“After moderate price declines late in the December quarter and early in the March quarter, ilmenite prices resumed an upward trend in recent weeks generating positive momentum for the June quarter.”
The multinational added that its local subsidiary started mining at the new site–Bumamani— in February. The move will extend the firm’s operations in Kenya to late 2024.
“The subsets of the North Dune forming part of the Bumamani Project will be mined concurrently with the South Dune to maximise mining rates and better manage tailings,” the company said.
Base Titanium continues with its exploration work in Kwale County as it seeks to discover new titanium deposits and keep the operations going.
“Expenditure on the Bumamani Project during the quarter was $4.9 million (last quarter: $9.9 million) with construction, earthworks and final land access activities completed on the P199 block of the North Dune.”
Base Titanium continues with its exploration work in Kwale County as it seeks to discover new titanium deposits and keep the operations going.
“Further landowner consent for exploration access in the Kwale East area (within Prospecting Licence 2018/0119) was secured during the quarter, with 677 holes for a total of 7,445 metres having been drilled by the end of the quarter,” its parent firm said.
“Several prospects have been identified for targeted drilling. It is expected that these will be completed in the June quarter as further land access is secured. Additional drilling rigs have been secured in order to accelerate the programme over the June quarter.”
