SA company risks losing Malawi bauxite exploration licence

Oct. 8, 2010 - The Malawi government has warned that unless a South African company assigned to explore for bauxite deposits on Mulanje Mountain brings forward convincing evidence "that it has something to show," it won't have its licence renewed.
"This company was given a licence to explore for bauxite deposits because they were interested in aluminum but three years down the line, they have not come up with any report," Energy and Mining Minister Grain Malunga told PANA Tuesday, adding that "unless they convince us that all these years they did some work and that the work is credible, we won't renew their licence".
Gondo Resources of South Africa were granted a licence in 2007 to explore for bauxite in order to extract aluminum on Mulanje Mountain, Malawi's tallest mountain, lying some 100 kilometres south of the commercial hub, Blantyre.
According to Dr. Malunga, the Mulanje massif has bauxite deposits of over 60 million metric tonnes, most of which remain unexplored.
Malunga, however, said in an earlier feasibility study between 1993 and 1997 by the now-defunct state-owned entity called Malawi Investment Development Corporation, confirmed some 28 million metric tonnes in bauxite deposits around Lichenya and Linje plateax on the mountain.
"This company was interested in the potential aluminum in the bauxite around Lic henya and Linje plateax but their licence is due to expire this December and they have not come up with anything," he said.
There was no comment from Gondo Resources because they have no known address or listed phone number in Mulanje or anywhere in Malawi, as a Google search also turned up nothing useful about the company, fueling suggestions that they might have been licenced irregularly.
"This (the non-renewal of the Gondo Resources mineral exploration licence) must act as a warning to others who just acquire licences only for speculative purposes," said the minister, a renowned mining and environment expert.
Malunga said government is currently "cleaning up" registers of companies that have been licenced to explore for minerals in Malawi but are doing nothing, there by blocking serious ones.
It requires heavy electric power to break up bauxite components in order to extract aluminum oxide. The resultant aluminum is used in various metal products.
Malawi is currently grappling with a serious foreign exchange reserve deficit be cause the southern African country heavily depends on the US$ 400 million-a-year tobacco industry which is currently under threat, due to various anti-smoking lobbies.
Economic analysts said it is high time Malawi explored other potential foreign e xchange earning avenues like tourism and mining.
An Australian company, Paladin Africa, has just started mining uranium in the no rthern border district of Karonga.