Red flags raised after invasion of two Chinese nationals’ collecting samples at Kangankunde rare earth mine in Balaka

A sign post at Kangankunde clearly warning against trespassing

* The audacity of these Chinese geologists in breaching the existing operations of Lindian questions like they might have the knowledge that Kangankunde Mine is free for other investors to bid 

By Duncan Mlanjira

An invasion at Kangankunde rare earth mine in Balaka by two unidentified Chinese nationals, suspected to be geologists caught trespassing and illegally collecting mineral samples, has raised red flags questioning if the almost-done deal with Australian company, Lindian Resources Ltd is open to other investors.

According to reports, community members around Kangankunde Mine, which has the world’s largest rare earth deposits, intercepted the two Chinese nationals and were handed over to Balaka Police expecting to face charges of criminal trespass by the Balaka Magistrates Court on Tuesday. 

“This is the third time these Chinese nationals have done this,” said community leader, James Makanga. “Their actions are beginning to raise alarm to us as members of the community.”

On his part, Robert Martin, executive chairperson of the Australian company, which is in a deal with Malawi Government to extract the rare earth deposits, confirmed the incident and said the company was cooperating with local authorities on the matter. 

Martin described the incident as a serious breach of the mining site security and a “concerning act of industrial trespass”.

“We would like to thank our security team, the local police and our operational staff for their diligence in maintaining a safe and secure site,” he said. “The company takes safety and security extremely seriously.”

However, a highly-placed source in the business sector, who sought anonymity, observes this incident as strange — questioning if the government completed a binding mining development agreement (MDA) or if the Kangankunde Mine is still open to other investors.

“The audacity of this Chinese geologists in breaching the existing operations of Lindian questions like they might have the knowledge that Kangankunde Mine is free for other investors to bid,” he said.

He referred this new development to the red flags which ActionAid Malawi made in 2015; https://www.maraviexpress.com/lotus-resources-strong-tax-breaks-on-kayelekera-mine-deal-defy-advice-against-such-incentives-made-by-actionaid-malawi-in-2015-on-former-investor-paladin-africa/, saying that report suggested that any other mining investment should be scrutinised by experts, Parliament, CSOs and any other interested stakeholders.

“Has the government completed a mining agreement with Lindian Resources? If so, who else was involved in the formulation of the agreement? Did Malawi Parliament and other interested stakeholders from the business sector given the chance to scrutinise the contents?

“This is what the public needs to know so that mistakes that were made in mining should not be repeated, which Minister of Mining observed in Parliament,” he said — referring to Minister Ken Zikhale Ng’oma statement made in the august House on April 4 accepting that the government has been making mistakes in the mining development agreements with foreign company investors.

Zikhale Ng’oma confessed that past agreements with foreign mining companies have been signed without adequate due diligence as he responded to a question by Member of Parliament, Mark Botomani on what Malawi is benefiting from its vast minerals, which is top of agenda for the current government administration in the economic recovery of the country through the agriculture, tourism and mining (ATM) strategy.

The Minister confessed that despite having vast mineral resources, the country has seen minimal benefits because of poor decision-making, poor policies and rushed mining development.

Thus the red flags over the trespassing of the Chinese geologists on land sorrounding Lindian Resources’ investment in a deemed done-deal with the Australian company.

According to Lindian’s website, the current holder of key permits of the investment is Rift Valley Resource Developments Limited, of which Lindian currently owns 67% and it is the Australian company’s “intent to move to 100% ownership of Rift Valley Resource by making the final US$10 million vendor payment at or before process plant commissioning commences”.

“Malawian registered Rift Valley Resource Developments Limited holds 100% of Exploration Licence EPL0514/18R and Mining Licence MML0290/22 issued under the Malawi Mines and Minerals Act 2018.

“The Exploration and Mining Licences have an Environmental and Social Impact Assessment Licence No.2:10:16 issued under the Malawi Environmental Management Act No. 19 of 2017.”

Meanwhile, Lindian reiterated its commitment to safeguarding its operations and will continue to work closely with regional and international partners to protect the Kangankunde site and ensure the integrity of its global critical minerals contribution.

“To find foreign nationals on an active, unmapped haul road taking samples is concerning, especially given the current geopolitical landscape surrounding rare earths.”

“We will continue to work with authorities to ensure the security and sovereignty of the project are upheld to the highest standards,” said Martin.

It is reported that local law enforcement are conducting an investigation, with Lindian providing full cooperation and that further updates are expected as the investigation continues.

Lindian’s website further indicates that the rare earth Kangankunde project is top tier in terms of high rare earth grade, and low levels of impurities and radioactive minerals, whose feasibility study was completed in June 2024.

The feasibility study “demonstrated that the project has one of the lowest capital and operating cost structures of rare earths projects globally”.

“This low-cost structure is supported by a technically low risk and robust Stage 1 project involving mining operations, a mineral processing plant, and necessary support infrastructure.

“Importantly, Stage 1 could serve as a logical springboard for future expansions. With such impressive development and expansion potential, the Kangankunde Project is truly a world-class rare earths asset,” says the company.

It adds that the project exhibits significant geological and mineralogical potential with extensive rare earth mineralisation and that the rare earth mineralisation is dominated by monazite.

“The total indicated and inferred mineral resource is 261 Mt averaging 2.14% TREO above a 0.5% TREO cut-off grade. With 61 Mt of indicated resource grading 2.43% TREO (0.5% TREO cutoff grade) with a higher grade component of 25 million tonnes grading 3.26% TREO (2.5% TREO cutoff grade) (ASX Announcement 2 May 2024).

“The Kangankunde project has future exploration upside, with two deep drill holes confirming mineralisation continuity to 1,000 metres below the surface. Lindian has therefore set an exploration target for the Kangankunde Project (ASX Announcement 5 October 2023).

The Ore Reserves amount to 23.7 Mt at a grade of 2.9% Total Rare Earth Oxides (TREO). These reserves fall entirely within the Probable category, based on a cut-off grade of 1.0% TREO (ASX announcement 1 July 2024).”

On social and environmental aspect of operations, Lindian says the project — which is located in the Traditional Authority (T/A) Chanthunya and sub-T/A Nyala primarily impacting Group Village Head (GVH) Makolela community — “enjoys the support of and will significantly benefit the local economy and rural community by promoting sustainable growth, creating jobs, and investing in the community while respecting traditional Malawian customs”.

A community engagement plan (CEP) was developed in collaboration with the local government, traditional leaders, communities, organisations, and women’s groups in the Kangankunde project area — establishing a committee comprising community leaders, local community representatives, District Council officials and senior leadership of Lindian.

“The committee’s purpose is to act as a forum for continued communication and engagement and defines the process for addressing issues.”