Ministry of Mining has given a go-ahead to Lotus Resources and Lancaster Exploration Limited (BVI) to start mining works at Kayerekera in Karonga and Songwe Hill in Phalombe.
From the two ventures, government expects to rake in about $140 million (K238 billion) in royalties and taxes.
This was revealed during an agreement signing ceremony between government officials and Lotus as well as Lancaster Exploration Limited, at the Office of the President and Cabinet in Lilongwe on Friday.
Minister of Mining Monica Chang’anamuno said finalisation of the agreement with the companies would bring tremendous revenues to the Treasury aside from the hundreds of jobs to be created at the mines.
She said the two deals are in line with President Lazarus Chakwera’s agriculture tourism and mining (ATM) strategy which highlights mining as a key component in rebuilding the country’s economy.
The minister said: “In this agreement with Lotus, we are expected to get $1.6 million [K2.7 billion] per month in dividends and $20 million [about K34 billion] in royalties per year from Kayerekera with uranium prices pegged at $65 [K110 500] per pound.
“While with Lancaster Exploration Limited doing the mining at Songwe Hill in Phalombe, we are expected to get $120 million [K204 billion] per year for both royalties, dividends and taxes,” Chang’anamuno said.
She also said Lotus will employ 450 direct workers and 200 indirect workers, while Lancaster would employ 1 200 direct workers and 500 indirect workers per annum in the 18-year mine duration.
Minister of Finance and Economic Affairs Simplex Chithyola Banda said he expected the two deals to boost the foreign exchange vault.
“However, let me request the companies to consider processing the minerals do and value addition in the country because that will help the country generate more resources than exporting raw minerals,” he said.
On his part, Lotus Resources managing director Keith Bowes said they would go into full production in 24 months.
While Lancaster Exploration Limited and Mkango Resources director Alexandar Lemon said they will speed up the first phase of construction of the mining operation at Songwe Hill in Phalombe.
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