Globe Metals & Mining Ltd (ASX:GBE) is looking at some impressive economic and environmental outcomes from the Kanyika Niobium Project in Malawi, following its recent optimisation study.
The optimisation study follows the 2021 definitive feasibility study (DFS) that first established Kanyika’s potential configuration and economic feasibility.
This latest study provides a strong foundation for Globe to advance the project towards financing and development, and points to Kanyika’s potential to become the first new globally significant niobium mine in 50 years.
Critical mineral
The high-purity niobium oxide products will be sold into the specialty metals markets, realising premium prices on the ferro-niobium market.
ESG niobium is on the US critical mineral list and has many applications in the new economy, including in fast-charging batteries. Niobium as an anode is proven to allow faster and safer charging, higher energy density, and safer performance.
Niobium is also a key component of energy-related and specialty technologies and structures such as in steel – for example, bridges, high-rise buildings, and oil and gas pipelines – superalloys in aircraft engines and solar power generator engines, and superconducting magnets in medical imaging devices and nuclear power generation.
CEO Grant Hudson said: “The extremely positive results of the optimisation study reflect the continuing upward trajectory of this exciting venture, and as the use of niobium soars, Globe is in the invidious position of being the most advanced new niobium producer in the world.
“Our latest refinery technology initiatives, coupled with our conflict-free status and outstanding green credentials, will further enhance Globe’s strong economic proposition and I look forward to sharing this wonderful story with interested investors and offtake partners at this week’s Mining Indaba in Cape Town.”
Robust financials
Globe anticipates an average nameplate production of 3,267 tonnes per annum of niobium pentoxide, (Nb2O5) and 136 tonnes per annum of tantalum pentoxide (Ta2O5) over the 27-year life of operations.
Some of the robust financial and technical improvements on the DFS include:
- a pre-tax NPV (8%) of US$1.004B and IRR of 47.08%;
- a 15% reduction in unit cost of niobium pentoxide to US$18.90 per kilogram;
- gross margin increases to 71%, a 5% increase versus the 2021 DFS with an average selling price forecast of US$51.48 per kg of NB205;
- US$280 per kilogram for Ta205 over the life of the mine; and
- Capex of US$29 million during phase one, including environmental bond and project-affected people relocation.
Two phase approach
The study provides for a two-phase development approach, which allows for a significant reduction in initial upfront capital from US$70 million to US$30 million and greatly reduces the risk profile of the project.
In addition, changes to the chlorination process in the refining technology will ensure the process is more environmentally sustainable and cost-effective, and results in a high-purity product which can command premium prices.
The preferred location of the refinery will be Malawi.
The Nb2O5 and Ta2O5 products will be high-specification high-purity products with grades exceeding 99.5% and 99% respectively.
Globe will present a further detailed report regarding the study during the current quarter.
ESG credentials
The Kanyika Project has been shown to be a bottom-quartile cost project and is designed to ensure the production of 'green niobium'.
Its Scope 1 and Scope 2 carbon emissions will be of the lowest in the world, with hydroelectric and solar power dominating its power sources for both the mine site and the refinery.