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Mkango Resources Ltd

Mkango Resources buoyed as rare earths feature in US/China trade spat

In the past ten days, Mkango has seen its stock market value rise by about a third to £10.6mln, or 8.85p per share

Trump
Rare earths moved centre stage as China hit back at US moves

Shares in Mkango Resources PLC (LON:MKA) have posted strong gains recently after China threatened to pull the plug on rare earth supplies due to the trade war with the US.

Rare earth metals were specifically mentioned by the Chinese as the war of words with Donald Trump cranked up.

China accounts for between 70% and 80% of global supply and is a key price setter.

Rare earths, especially magnetic ones, are used in wind turbines, lithium ion batteries for electric vehicles, in consumer electronics and in air conditioning units, all of which are predicted to see usage soar in coming decades.

Mkango is developing the Songwe Hill rare earths project in Malawi and in the past ten days has seen its stock market value rise by about a third to £10.6mln, or 8.85p per share,  as the Sino/US trade tensions have mounted.

In February, Mkango announced an updated mineral resource estimate for Songwe of 8 million tonnes grading 1.50% TREO (rare earth metals) in the measured category.

There was also an indicated resource of 12.2Mt grading 1.35% and 27.5 Mt grading 1.33% of inferred resources.

In a first quarter update posted on Friday, Mkango reported a loss of US$697,000 for the three months to March, but closed the period with cash of US$11mln following the receipt of a further US$9mln from Talaxis, which has farmed-in to Songwe Hill.

Through that investment, Talaxis increased its stake in Lancaster Exploration, the holder of the licence for Songwe in Malawi, to 49%; Mkango holds the remaining 51%.

Quick facts: Mkango Resources Ltd

Price: £0.07

Market: LSE
Market Cap: £9.38 m
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