Lindian Resources Ltd (ASX:LIN, OTC:LINIF) has reported a step-change in the economics of its Kangankunde Rare Earths Project in Malawi, following optimisation of the Stage 1 processing plant design and the appointment of Obsideo as design and construction contractor.
The updated process plant design supports a 25% increase in ore throughput, lifting planned monazite concentrate production from 15,300 tonnes per annum to 20,000 tonnes per annum, while keeping capital costs broadly in line with the definitive feasibility study.
“The optimisation work in the process infrastructure, giving Lindian the ability to substantially increase stage 1 concentrate production, is a notable achievement in the project,” Lindian’s executive director, Zac Komur, said. “This has led to a material increase in financial metrics including a NPV improvement of 45% to A$1.72bn for Stage 1.
The revised metrics reconfirm Kangankunde as a globally competitive rare earths development project, even under conservative pricing assumptions.
Processing optimisation drives higher production capacity
The optimisation work has reconfigured the Kangankunde process plant to increase ore throughput from 60 tonnes per hour to 75 tonnes per hour, reducing recovery risk and improving operational flexibility.
Under the revised design, Stage 1 production capacity increases to 20,000 tonnes per annum of monazite concentrate, compared with the 15,300 tonnes per annum outlined in the July 2024 feasibility study. The higher throughput is supported by simplified circuit design and improved materials handling, allowing Lindian to better respond to strong demand for its high-grade monazite product.
The increase in production capacity is a key step in expanding potential sales volumes to strategic offtake partners, while maintaining concentrate quality and recovery performance.
Strong uplift in financial metrics confirmed
The higher throughput and lower operating costs have translated into a material uplift in Kangankunde’s financial metrics.
Based on the optimisation work, pre-tax net present value at an 8% discount rate has increased by 45% to A$1.725 billion, compared with A$1.189 billion in the feasibility study. Average annual EBITDA has risen by 38% to A$171.5 million, while pre-tax internal rate of return has increased from 99% to 142%.
Average annual revenue is now estimated at A$228.9 million, up from A$170.3 million, reflecting both higher production volumes and the premium nature of the concentrate.
Mining and processing cost reductions underpin improvements
In addition to higher throughput, Lindian has reduced operating costs by adopting an owner-operator mining model, which is expected to lower mining costs by approximately 30%.
The processing plant design has also been streamlined to improve efficiency. The revised flowsheet replaces multi-stage crushing and ball milling with a single-stage crushing and SAG mill configuration, while classification has shifted from high-frequency screening to cycloning to improve flexibility.
Figure 1. Concept image of proposed MGS Circuit Figure 2. Concept image of proposed shaking table circuit.
Further changes include early rejection of low-grade coarse material, regrinding of composite particles to improve rare earth recovery, and de-bottlenecking of concentrate handling through upgrades to magnetic separation and filtration. Sulphide flotation has been removed from the circuit following metallurgical test work, reducing complexity without compromising concentrate quality.
Obsideo appointed as D&C contractor
Lindian has awarded Obsideo the design and construction contract for the Stage 1 processing plant following a structured competitive tender process.
The contract covers full engineering, procurement, construction and commissioning of the plant, including crushing, grinding, gravity and magnetic separation circuits and associated infrastructure. Key terms include performance guarantees and commercial mechanisms aligned to cost, schedule and safety outcomes.
Obsideo was selected based on its technical capability, relevant project experience and ability to deliver within Lindian’s development timeline. The group has previously delivered several mineral processing projects across Africa and has specific experience in rare earths, including commissioning the Gakara rare earths processing plant in Burundi.
“Finalising the D&C contractor is a key milestone as we transition Kangankunde into full construction. Obsideo demonstrated the strongest technical and execution capability across the tender process, and their appointment provides the confidence and commercial discipline needed as we move into detailed engineering and procurement. With early works complete and major packages advancing in parallel, this award keeps us firmly aligned with the schedule and ensures Stage 1 capital remains consistent with the DFS parameters. We look forward to working closely with Obsideo as we progress the processing plant toward first production in Q4 2026.”
Speaking on the D&C award, Obsideo CEO and managing director Cobus Robertson said, “Obsideo is excited to be awarded the Design and Construction Contract for the world-class, Kangankunde Rare Earths Project. We look forward to engaging closely with the Lindian team to deliver safe and successful outcomes for the Optimised Minerals Concentrator Plant. We are focused on delivery of the processing plant by end of 2026 in line with Lindian’s pathway to first production of rare earths Monazite Concentrate. This project supports our position as a leader in rare earth mineral processing.”
Capital costs and schedule remain intact
Despite the design refinements, Stage 1 pre-production capital costs remain within 10% of the feasibility study estimate and within the company’s existing US$40 million funding envelope.
Major contracting packages have progressed in parallel with early works and non-process infrastructure construction, with updated pricing reflecting the optimised design. Long-lead items, including key gravity separation equipment, have already been procured.
The project schedule remains intact, with first production targeted for the fourth quarter of 2026.