Lindian Resources has secured approval to expand its Kangankunde Rare Earths Project mining licence from 900 to 2,500 hectares, enabling a significant scale-up in production capacity. The company retracts its previous high-end Stage 2 production targets and will commission a new feasibility study to define the next phase.
- Mining licence expanded from 900ha to 2,500ha by Malawi authorities
- JORC-compliant Ore Reserve of 23.7 million tonnes and Mineral Resource of 261 million tonnes underpin expansion
- Previous Stage 2 production target of 75,000–100,000 tpa retracted pending new feasibility study
- Strategic partnership with Iluka includes right of first refusal for funding and offtake
- Stage 1 production target of 15,300 tpa remains unchanged
Mining Licence Expansion Unlocks Growth Potential
Lindian Resources Limited (ASX – LIN) has taken a major step forward in developing its Kangankunde Rare Earths Project in Malawi with formal approval to expand its mining licence area from 900 hectares to 2,500 hectares. This substantial increase, more than doubling the project footprint, provides the regulatory certainty and physical space needed to pursue a significant scale-up in production capacity beyond the initial Stage 1 plans.
The approval from Malawi’s Mining and Minerals Regulatory Authority (MMRA) signals strong government support and materially de-risks the pathway for the project’s Stage 2 expansion. It also enables Lindian to plan a modular, phased infrastructure rollout that can adapt to evolving market conditions and funding availability.
Robust Resource Base Supports Expansion
The Kangankunde deposit remains one of the world’s largest rare earths resources, boasting a JORC-compliant Ore Reserve of 23.7 million tonnes and a total Mineral Resource of 261 million tonnes. This solid foundation underpins Lindian’s confidence in scaling production. The project’s high-grade monazite concentrate, with 55% total rare earth oxides (TREO) and low deleterious elements, positions it competitively in the global market.
Despite this, Lindian has prudently retracted its previously referenced conceptual Stage 2 production target range of 75,000 to 100,000 tonnes per annum (tpa). Instead, the company will commission a new expansion feasibility study to establish a definitive production target above the Stage 1 capacity of 15,300 tpa and the earlier identified potential of 50,000 tpa. Investors are cautioned not to rely on the earlier indicative figures.
Strategic Partnership with Iluka Enhances Funding and Offtake Prospects
Lindian’s recently announced strategic partnership with Iluka Resources adds a critical dimension to the project’s expansion prospects. Iluka holds a right of first refusal (ROFR) for offtake of incremental Stage 2 production volumes and is positioned to provide up to 50% debt funding for the expansion capital costs. This partnership not only strengthens Lindian’s financial footing but also aligns with Iluka’s ambitions to become a major supplier of refined rare earth oxides through its Eneabba refinery in Western Australia.
The ROFR mechanism offers Iluka either 33% or 80% of incremental production for 15 years, up to an annual maximum of 31,000 dry metric tonnes of monazite concentrate, contingent on funding arrangements. This arrangement underscores the growing strategic importance of rare earths in global supply chains, especially for critical technologies.
Next Steps and Market Implications
With the mining licence expansion secured, Lindian is advancing the Stage 1 process plant development while simultaneously preparing for the Stage 2 expansion feasibility study. The company emphasizes that all material assumptions from the Stage 1 feasibility study remain valid, and no changes have been made to the Stage 1 production target.
Executive Chairman Robert Martin highlighted the opportunity to leverage learnings from Stage 1 to optimise processing and recoveries for the larger expansion. Lindian is also actively engaging with other potential strategic partners for funding and offtake, signaling a dynamic phase ahead.
This development places Lindian Resources on a promising trajectory to become a globally significant rare earths producer, with a project that combines scale, grade, and strategic partnerships in a critical minerals sector experiencing heightened demand.
Bottom Line?
Lindian’s licence expansion and strategic partnerships set the stage for a pivotal feasibility update that will define the rare earths producer’s growth trajectory.
Questions in the middle?
- What will the new Stage 2 production target be once the expansion feasibility study is complete?
- How will Iluka’s funding offer and offtake rights influence the timing and scale of the Stage 2 expansion?
- What are the environmental and community impacts anticipated with the expanded mining footprint in Malawi?