Multimillion Pula Manganese mine to operate next year

Mine will start operations at Kgwakgwe Hill near Kanye Project will become a low- carbon producer Mine operation revitalises dream of manufacturing electric car

Amultimillion manganese mine with an estimated post- tax net present value of over US$ 480 million will soon start operations at Kgwakgwe Hill near Kanye in the Southern District, Botswana Guardian has reliably been told. The mining of one of the world’s most sought- after commodities, which spread across the Kanye Basin is owned by Giyani Metals Corp, a Canadian listed mineral resource company through its whollyowned Botswana subsidiary, Menzi Battery Metals ( Pty) Ltd. Giyani is focused on becoming one of Africa’s first low- carbon producers of highpurity manganese sulphate monohydrate ( HPMSM) - a precursor chemical used in the production of lithium- ion batteries employed in electric vehicles ( EVs). The company this week released the results of its feasibility study that proves this will be a profitable venture worth investing in. It will be a low capital intensity for what will be one of the largest HPMSM projects in the world with an estimated initial capital expenditure of US$ 281M ( C$ 379million), including contingency of US$ 32m ( C$ 43m), for a fully- integrated battery raw materials project. On Monday, the Company announced a feasibility study for the mining and processing of up to 200,000 tonnes per annum of ore from the Kgwakgwe Hill project to produce HPMSM. In an interview with Botswana Guardian, Menzi Battery Metals country manager, Elisa Kgomotso Davis confirmed that they have completed their feasibility study and their next stage will be moving towards delivering a demonstration plant which is currently being built in South Africa, and remains on track to produce HPMSM in the second half of next year. The demo plant is the next step to de- risking, optimising, and validating the development of a full- scale process plant which will be built in Botswana. She said in addition to the Kgwakgwe Hill project, Giyani continues to advance exploration activities at the Company’s other prospects in Otse and Lobatse. It is the Company’s intention that mined material from Otse and Lobatse could be transported to the processing plant planned for Kgwakgwe. Davis explained that Giyani, through Menzi has focused its full attention on the advancement of its manganese assets within the Kanye Basin since 2018, and that the Kanye Basin Prospects consist of eight prospecting licences and include the past- producing Kgwakgwe Hill mine, Otse manganese prospect and Lobatse manganese prospect, all of which have seen historic mining activities. The delivery of Kgwakgwe is a significant milestone for the company and marks the next step of the development of a fully- integrated battery materials producer in Botswana. The feasibility study also demonstrates Kgwakwe’s potential to be “one of the most significant and largest producers of battery- grade manganese globally”, and these results highlight the strong project economics and further upside opportunity available to Giyani in Botswana. Davies said the key highlights of the feasibility study included robust economic returns: Post- tax net present value of US$ 481m, Post tax internal rate of return of 28 percent and a payback period of just over three and a half years, Low capital intensity for one of the largest HPMSM projects globally, Initial CAPEX of US$ 281m, including contingency of US$ 32m; a significant geological upside with potential to expand and extend mine life. Work to upgrade the 3.1 Mt Inferred at Kgwakgwe Hill extension to Indicated Resources is expected next year, which alongside Otse, provides the additional potential to expand the Project in future years and extend the mine life significantly. Others are operational advantages of higher grade ore and conventional mining at Kgwakgwe Hill. The relative high grade underpins a scalable operation with an initial throughput of 200,000 tonnes ore production per annum, offering potential future production capacity expansion. The Lithium- ion battery demand is expected to increase significantly, CPM Group is forecasting a 30x demand increase for EV batteries between 2021 and 2036, as battery manganese continues to grow in importance. Strong local employment during operation is expected, with the Kgwakgwe project estimated to directly employ between 200- 250 skilled professionals alongside a significant number of indirect jobs to support the project. The Company has already integrated plans to use solar power as part of its operation and continues to push for further reductions as Giyani moves forward with a roadmap for decarbonisation, and a strong environmental, social and governance ( ESG) credentials. The environmental permitting process ( ESIA) is progressing and is estimated to be completed and submitted to the authorities in Botswana in the coming months. Others are a strong free cash flow over the life of the Project estimated at US$ 1,093m ( C$ 1,476m), equivalent to US$ 99m ( C$ 134m) per year with first commercial production in 2025. Executive Chairman of Giyani, Jonathan Henry said in the company Website that their flagship Kgwakgwe manganese project has the potential to be one of the most significant and largest battery- grade manganese producers globally. The feasibility study shows how far the scope of the Project has developed since the April 2021 preliminary economic assessment and is the next step to bringing this project into production. “These results demonstrate the robust economics of Kgwakgwe, with our ongoing work also highlighting the expansion and optimisation potential. Giyani has an early- mover advantage to meet the growing demand for HPMSM from the EV sector, which is prioritizing responsible, low- carbon producers outside of the dominant Chinese supply chain. “Our hydrometallurgical process, which treats our captive ore without the need for calcining or electro refining, saves both cost and carbon emissions, as evidenced by the results of the recent life cycle assessment for Kgwakgwe,” he said. He said parallel to the feasibility work, the team has progressed the construction of demonstration plant and it remains on track to produce HPMSM samples for testing by potential off- takers in H2 2023.