Malawi holds promise as a rare earths elements hub given the cluster of high-grade projects in the region and DY6 is joining the hood when it lists on the ASX this Thursday.
Geologists, investors and ASX companies are turning to a remote part of south-eastern Africa to play a part in diversifying the world’s critical mineral supply away from China.
Billionaire mining investor Robert Friedland told Bloomberg the critical metals the world needs for electrification are primarily going to be sourced in Africa.
“We can’t mine in Russia or Ukraine, we can’t mine in areas that are ecologically sensitive where it rains or snows more than it evaporates because of the integrity of tailings ponds…it is really Africa that the world depends on to find the metals you need for any form of energy transformation.”
Known ubiquitously as “the warm heart of Africa”, Malawi, a landlocked region in Sub Saharan Africa, is home to some of the highest-grade rare earth deposits in the world, though it is still very much underexplored.
“It’s a jurisdiction where there’s a push for foreign investment and we’ve seen that with a number of our peers operating in the country,” DY6 Metals non-executive chairman Dan Smith says.
Canadian mineral explorer Mkango Resources recently secured an Environmental Social Health Impact Assessment (ESHIA) approval for its Songwe Hill rare earths project, which will become the first commercial rare earths project when it comes online in 2025.
And earlier this year, $339 market cap company Lindian Resources (ASX:LIN) inked $9m in funding via a share placement for the construction of a rare earths concentrate processing facility at the Kangankunde project in the southern part of the country.
Described as one of the biggest, rare earth operations outside China, Kangankunde hosts an outdated resource of 2.53 million tonnes grading 4.24% total rare earth oxides for 107,000 tonnes of contained rare earths.
Newest ASX listee in Malawi’s rare earths hot spot
But with three highly prospective rare earth and critical mineral exploration projects in tow and having secured a total of $2.5m in IPO commitments from two strategic cornerstone investors, DY6 Metals believes it has what it takes to fast-track exploration and discovery in the region.
The company is set to list on the ASX at 11am AEST this Thursday, June 29, under the ticker code ‘DY6’.
At the flagship Machinga heavy rare earth (HRE) project only 40km east-southeast of Lindian’s Kangankunde project, Smith notes that DY6 Metals is already on the ground conducting a 5,000m RC and diamond drilling program to follow up targets drilled by previous owner, Globe Metals and Mining (ASX:GBE), in 2011/2012.
Although the Southern Malawi alkaline province is known to host a range of light and heavy rare earth (HRE) projects, the very high ratio of HRE TREO results at Machinga – with peak values of 39% – in conjunction with high ratios of DY2O3 with an average of 3.3%, sets the project apart from the rest.
“A 2010 trenching program pulled up some nice numbers including 7m at 1.26% TREO and 33m at 0.71% TREO so we will follow up those areas and extend the drilling program along strike from the north and south to see how far we can chase that mineralisation,” he explains.
“Additionally, Machinga is also enriched with niobium, a critical mineral used in lithium-ion batteries.”
Other rare earth and critical mineral projects
The explorer’s Salambidwe project, part of the same Chilwa alkaline suite that hosts Kangankunde, Machinga and numerous other REE prospects, is more of a greenfields opportunity.
The company will conduct various exploration activities such as radiometrics, mapping and soil and rock chip sampling which DY6 Metals plans to work up progressively alongside Machinga.
Then there is the Ngala PGE-copper-nickel project, which has also received no significant modern exploration, including no electromagnetics to target potential high-grade massive sulphides.
But given its location, within close proximity to the Nacola rail/port corridor and grid power, the project could benefit in the future from access to supporting infrastructure with a pit to port solution for exporting products to global markets.
This article was developed in collaboration with DY6 Metals, a Stockhead advertiser at the time of publishing.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.