Legal wrangling stalls Malawi monazite-mining project

Mine development at the Kangunkunde monazite mine, in Malawi’s southern district of Balaka, has stalled for more than three years owing to a court wrangle over ownership of the mineral rights.

A consortium known as Rare Earth started developing the mine in 2003, after the Malawi government had granted it a mining licence.

At the time, the Malawi government had 
refused to renew an exclusive prospecting 
licence (EPL) for South Africa’s Rift Valley Resources on the grounds that it had failed to show that it was serious about starting mining operations.

“When you were granted an EPL in March, 2000, one would have thought that you already had most of the information from the previous 
work and completing what was outlined in your programme [was not going to] take long,” the then Energy Minister, Uladi Mussa, said in a letter to Rift Valley Resources representative Michael Saner.

“Government has serious reservations as regards your seriousness to develop the deposit into a mine. In the circumstances, government is unable to favourably consider renewal of your licence.”

Rift Valley begged to differ and sued the Malawi government in 2006. The High Court, in Blantyre, ruled that the Malawi government’s refusal of Rift Valley’s licence was 
illegal.

“I am presently awaiting a High Court date, where the sole item on the agenda is the quantification of damages that I have suffered, not the fact thereof – that is past. Government has not, as yet, abided by the court decision to 
return the mineral rights to me.


“My total costs to date, covering the above and including my legal costs, are approximately 
$1-million. However, you need to carefully consider the difference between ‘cost’, ‘price’, and ‘value’.

“My costs are the value I have added to the project and can be counted in the tens of millions of dollars,” says Saner in an emailed statement.

Rare Earths suspended work on the Kangunkunde deposit owing to the legal wrangling after it had, besides other things, completed construction of water reservoirs and foundations and had sunk boreholes.