The venture could become a top export earner for the Malawian government, which owns 15% of Paladin Africa Limited. According to Australian-based Paladin Energy Limited managing director, John Borshoff, "the project will have significant contributions to the economy of Malawi."
He said, despite constraints of the bad road network and distance, the whole operation will still start in September as scheduled since construction work is progressing on well.
“Main challenges have been the distance from workshops and industries but we have largely overcome this by using services from good trucking companies,” he said.
Ed Becker, Paladin's chief geologist, says the project is expected to produce about 1,000 tonnes of uranium oxide each year worth about K14 billion (US$100 million) at current price.
Paladin Energy Limited estimates that the Kayelekera deposit can support a 10-year mine life producing approximately 10,000 tons of uranium oxide.
Finance Minister, Goodall Gondwe said the project is going to help Malawi's export revenue, which has remained stagnant since the 1970s and as a result continued jeopardising the country's long-term economic prospects.
"However, with the prospects of uranium mining...Malawi's export revenue will increase by 50%, earning the country US$280 million. This will bring very significant change to our economy," he said adding that Government will ensure that the project succeeds.
While commending good support from the Malawi government, Borshoff still expressed the urgency to deal with the bad road network to the site which is 40km west of the town of Karonga on the shore of Lake Malawi.
“When operation commences, between 30 and 40 trucks will be using the road daily, bringing in materials, reagents and other consumables to the site...this could be slowed down if the condition of the road remains the same,” he said.
The Government has engaged a Chinese company which will soon start construction on the road.
According to Borshoff, the US$200 million capital cost of the project could generate between $150 million and $180 million a year, depending on the price of uranium.
The project has already created over 1000 jobs during this construction phase and more than 200 permanent jobs will be available in the operations phase, besides the employment of contractors.
