Kayelekera Uranium Project Secures US$8.5M Equipment Finance, Power Grid Contracts Signed
Lotus Resources has initiated processing of high-grade uranium ore at its Kayelekera Project in Malawi, moving closer to first uranium production this quarter. Key infrastructure upgrades, including a new power grid connection, aim to reduce costs and environmental impact.
- High-grade uranium ore processing commenced at Kayelekera
- Power grid connection contracts signed to replace diesel power by end of 2026
- Tailings Storage Facility expansion accelerated for operational efficiency
- US$8.5 million equipment finance facility secured with First Capital Bank
- Restart on track within US$50 million capital budget, fully funded with A$75.9 million cash
Restart Milestone Achieved with High-Grade Ore Processing
Lotus Resources Limited has marked a significant milestone in the revival of its Kayelekera Uranium Project in Malawi by commencing processing of high-grade uranium ore. This development signals the transition from commissioning to sustained hydrometallurgical operations, with all leach tanks now operating at full capacity. The company expects to produce its first uranium product within the current quarter, underscoring the progress made since the project’s restart plan was announced.
Strategic Infrastructure Investments to Lower Costs and Emissions
In a move to enhance operational efficiency and environmental sustainability, Lotus has signed fixed-price contracts to construct a power grid connection, replacing the existing diesel-generated power supply. Scheduled for completion by the end of 2026, this connection to Malawi’s largely hydroelectric grid is projected to reduce power costs by US$5–6 per pound of uranium and significantly cut carbon emissions. The project also includes installation of a Battery Energy Storage System to ensure power reliability.
Tailings Storage Facility Expansion Accelerated
To support a projected 10-year mine life, Lotus has accelerated the expansion of its Tailings Storage Facility (TSF). Detailed design work confirms the facility can be expanded by approximately 12.8 million tonnes, with construction phases planned to optimize efficiency. Notably, phases 1A and 1B of the embankment raises are now planned to be delivered concurrently, bringing forward capital expenditure but improving overall project execution.
Financial Position and Equipment Financing
Lotus remains financially robust, reporting A$75.9 million in cash at the end of June and no drawn debt. The company has also secured an US$8.5 million equipment finance facility with First Capital Bank Plc to fund mobile and mining equipment. This facility offers flexible repayment terms and is structured to support the ongoing restart and operational ramp-up.
Outlook and Community Impact
Managing Director Greg Bittar emphasized the company’s commitment to operating Kayelekera in an environmentally and socially responsible manner. The transition to grid power not only reduces emissions but also provides local communities along the powerline route with access to electricity for the first time, reflecting Lotus’s broader ESG objectives. As the project advances toward full production, these infrastructure and community benefits will be critical to its long-term success.
Bottom Line?
With first uranium production imminent and infrastructure upgrades underway, Lotus Resources is poised to reshape its cost structure and community impact at Kayelekera.
Questions in the middle?
- When exactly will the first uranium product be shipped and how will it impact revenue?
- How will the accelerated Tailings Storage Facility expansion affect capital expenditure and operational timelines?
- What are the risks and contingencies if the power grid connection is delayed beyond 2026?
