Uganda has taken a major step towards developing its rare earth sector by approving a large-scale mining license for the Makuutu project, owned by the Australian company Ionic Rare Earths (IonicRE).
The project, located in the eastern region of Uganda, is one of the world’s largest and most advanced development-ready heavy rare earth element (HREE) assets, with a mineral resource estimate of 315 million tonnes at 650 parts per million total rare earth oxides.
Rare earth elements are vital for producing high-tech devices like smartphones, electric vehicles, wind turbines, and defense systems. However, the global supply of rare earths is dominated by China, which accounts for over 90% of the market and has imposed export restrictions and tariffs in the past.
According to the World Bank, the approval of the mining license for Makuutu is expected to boost Uganda’s mining sector, which contributes about 0.3% of the country’s gross domestic product (GDP). The project is also expected to create employment opportunities and generate revenue for the government through royalties and taxes.
IonicRE’s managing director, Tim Harrison, said the company was pleased with the announcement and thanked the Ugandan government for its support. He said the company looked forward to progressing to the next steps and commissioning its demonstration plant at Makuutu.
The demonstration plant, which is currently under construction, will produce HREE carbonate samples for potential customers and partners. The plant will also provide data for the project’s definitive feasibility study (DFS), which is expected to be completed by mid-2024.
The Makuutu project has a projected mine life of 33 years and an estimated capital expenditure of $144 million. The project is expected to produce an average of 2,813 tonnes per year of HREE carbonate, with a high proportion of magnet metals dysprosium and terbium.
The project has also received strong support from the local community and stakeholders, who have been involved in various social and environmental initiatives. IonicRE has established a community development foundation, which provides health care, education, water, and sanitation services to the surrounding villages.
The company has also implemented best practices in environmental management, such as water recycling, waste minimization, and rehabilitation. The project obtained an environmental and social impact assessment certificate from Uganda’s National Environment Management Authority.
The approval of the mining license for Makuutu comes when the global demand for rare earths is expected to increase significantly in the coming years, driven by the growth of clean energy and digital technologies. According to a report by Grand View Research, the global rare earth elements market size is expected to reach $5.62 billion by 2025, registering a compound annual growth rate (CAGR) of 10.4%.
With its strategic location in Africa, a continent rich in mineral resources and potential markets, Uganda is well-positioned to become a key player in the rare earth industry. The Makuutu project will be a flagship project that will showcase Uganda’s mining potential and attract more investment and development in the sector.
Source: Engineering News
