Mkango Resources Updates Economics for Malawi Rare Earths Project, Poland Plant

Mkango Resources (TSXV:MKA,LSE:MKA,OTCPL:MKNGF) has updated the projected returns for its Malawi-based Songwe Hill rare earths project and a planned processing facility in Poland.

New studies point to higher-value exposure to magnet metals expected to face supply shortfalls.

The company said on Thursday (March 19) that an updated definitive feasibility study for Songwe Hill and a prefeasibility study for the proposed Puławy separation plant offer a clearer picture of project viability under current conditions.

Songwe Hill is one of a limited number of rare earths projects globally to reach the definitive feasibility stage.

The project carries an estimated post-tax net present value of US$339 million at a 10 percent discount and an internal rate of return of 24 percent, with payback expected in 3.4 years from full production.

Over its 18 year mine life, Songwe is projected to generate US$1.55 billion in post-tax cashflow.

Initial capital expenditure for Songwe is estimated at US$297.8 million, excluding contingency, with average annual production of 5,954 metric tons of total rare earth oxides during the first five years. Output is expected to include key magnet materials such as neodymium and praseodymium, which are critical for electric vehicles and wind turbines.

The project will produce a purified mixed rare earth carbonate designed for export and further processing.

Mkango plans to feed this material into its proposed separation facility in Puławy, Poland, creating an integrated supply chain from mine to refined product. The plant also shows stronger headline economics at the prefeasibility level.

The study indicates a post-tax net present value of US$779 million and an internal rate of return of nearly 40 percent, with a payback period of just over two years. Life-of-project cashflow is estimated at US$4.95 billion.

Capital costs for the Polish plant are projected at US$212 million, including contingency. The facility is designed to separate rare earth carbonates into individual oxides, with a focus on neodymium and praseodymium.

Mkango said updated market analysis supports the investment case, with demand for rare earth magnets expected to grow faster than supply through 2040. The imbalance is driven by expansion in electric vehicles and renewable energy, sectors that rely heavily on permanent magnet technologies.

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Securities Disclosure: I, Giann Liguid, hold no direct investment interest in any company mentioned in this article.