Sovereign Metals Ltd (ASX:SVM, FRA:SVM) is continuing with its momentum with various work programs underway as it pushes ahead with the completion of the scoping study at its flagship, high-grade Kasiya rutile deposit in Malawi.
A maiden mineral resource estimate has established Kasiya as one of the largest rutile deposits in the world, with much of the high-grade material occurring within the top around five metres from surface.
The scoping study at Kasiya is well underway with the engagement of internationally recognised consultants and is targeted for completion in late 2021.
Sovereign is well-positioned with around A$7.96 million cash at the end of the June quarter, allowing the company to continue exploration and development activities on its rutile projects.
"Significant quarter"
Sovereign Metals managing director Dr Julian Stephens said: “This was a very significant quarter for the company.
“We released our maiden JORC mineral resource estimate showing Kasiya to be one of the largest rutile deposits in the world, all within 18 months since discovery.
“We continue our momentum with numerous work programs underway as we accelerate ahead targeting completion of the scoping study by the end of the year.”
Rutile market in supply deficit
Current sources of natural rutile are in decline as several operations’ reserves are depleting concurrently with declining ore grades.
These include Iluka Resources Limited’s Sierra Rutile and Base Resources Limited (AIM:BSE, ASX:BSE, FRA:B4Z)’s Kwale operations in Kenya.
Recent announcements by Iluka and Rio Tinto Limited advising of the potential suspension of operations at Sierra Rutile and Richards Bay Minerals (RBM) is expected to cause considerable additional product to be removed from the market in the near-to-medium term.
Additionally, there are limited new deposits forecast to come online, and hence supplies of natural rutile are likely to remain in structural deficit.
Natural rutile is the purest, highest-grade natural form of titanium dioxide and is the preferred feedstock in manufacturing titanium pigment and producing titanium metal.
The global titanium feedstock market is over 7.4 million tonnes of titanium dioxide, with the majority of this being consumed by the pigment industry.
A resurgence in demand for titanium pigment and from the welding sector, combined with concurrent supply shortages has led the cost, insurance and freight (CIF) China spot prices sharply upwards toward US$1,800 per tonne.
Largest, pre-eminent rutile deposit
Future resource growth could see Kasiya potentially become the largest and pre-eminent rutile deposit globally, with central Malawi potentially becoming the largest rutile province in the world.
Kasiya sits alongside Sierra Rutile as one of the top two deposits globally.
Growth potential
Sovereign has around 114 square kilometres of drilled, high-grade rutile mineralisation comprising Kasiya with 89 square kilometres and Nsaru 25 square kilometres.
The area covered by the Kasiya resource estimate is just 49 square kilometres or 43% of the 114 square kilometres drilled mineralised footprint.
There is an opportunity to expand on the maiden resource in the near to medium term, with extensive drilling programs underway.
Two core drilling rigs are now in operation on a 200+ hole program at Kasiya by Malawi drill contractors, Geoconsult, with additional support from Bamboo Rock Drilling.
The core program is designed to bring the central, high-grade areas of rutile mineralisation at Kasiya into the JORC Indicated category to underpin the scoping study.
Hand-auger drilling is also ongoing at its Nsaru deposit.
Scoping study
The scoping study is targeting a large-scale natural rutile operation that aims to fill some of the existing supply deficit with the purest and most environmentally sustainable titanium feedstock.
The aim is to develop a large-scale, long life, environmentally sustainable and socially responsible natural rutile operation.
Pre-feasibility-level metallurgical program
The company has designed a pre-feasibility level metallurgical program to further optimise flowsheet development and assess variability across the different weathering zones.
Sovereign Metals will also continue to evaluate the potential of recovering a graphite by-product from the Kasiya rutile deposit.
The metallurgical test-work program is being conducted at AML in Perth, with the four-tonne sample already on hand.
Key technical appointments
During the quarter, the company made key technical appointments, including Paul Marcos as head of development and Russell Bradford as study manager.
As head of development, Marcos will lead and manage key technical components of the Kasiya project, including the ongoing study due for completion this year, and for future feasibility programs.
Bradford has worked with a number of listed companies managing numerous technical studies that have advanced through to mine construction and successful operations.
ESIA start
The company has commenced significant components of the Environmental, Social, Impact Assessment (ESIA), with its core focus on creating an environmentally and socially responsible and sustainable operation.
Baseline environmental studies have commenced, covering terrestrial flora and fauna, aquatic biology, air quality, surface water and groundwater studies.
Sovereign Metals continues engagement with all stakeholders from local communities through to the Malawi government.
In line with its Environmental, Social and Governance (ESG) strategy, Sovereign appointed UK-based consultancy, Minviro Ltd to carry out gate-to-gate Life Cycle Assessments (LCAs) for the production of upgraded titanium feedstocks.
The target is to quantify the Global Warming Potential (GWP) for the production of one kilogram of each upgraded feedstock.
Impact titanium feedstocks
The LCAs showed that Sovereign’s natural rutile could potentially eliminate significant global titanium industry carbon dioxide emissions by displacing and substantially reducing the use of carbon-intensive upgraded alternatives.
Due to growing environmental pressures, and with the significant carbon footprints of numerous industry players related to pyrometallurgical ilmenite upgrading operations, Sovereign’s natural rutile product is well-positioned to impact the titanium supply chain by potentially displacing and reducing the use of carbon and waste-intensive upgraded alternative titanium feedstocks.
Sovereign’s discovery of the large Kasiya and Nsaru deposits represents a potentially major new source of global supply of high-grade primary natural rutile and an opportunity to remove significant CO2 emissions created by upgraded alternatives.