Base Titanium to shut Kwale mine next year after deposits depleted

Base Titanium plant in Kwale County. [Robert Menza, Standard]

Base Titanium will shut down its operations at its current mine in Kwale County, with the mine coming to the end of its lifecycle.

The company said in a statement Wednesday exploration in surrounding areas had failed to identify additional mineral deposits that could ensure the continuation of mining operations.

"Following an exhaustive exploration and evaluation process seeking to further extend the life of the Company's Kwale Operations in Kenya, mining is expected to end in December 2024 as per the current mine plan. Processing activities will conclude shortly thereafter," said Base Resources, the Australian miner whose Kenyan arm Base Titanium has been mining mineral sands at Kwale County.

It added that it had been prospecting in areas near the current mine but the resources it found there were not adequate to sustain the mining operations.

"After completing the previously announced evaluations of the two remaining near mine prospective areas, being the Kwale North Dune Mineral Resource not currently in the mine plan and the Kwale East exploration area, both lack sufficient grade or scale to support the capital investment required to extend or establish new mining operations," said Managing Director Tim Carstens in the statement.

"On this basis, when existing Kwale Ore Reserves are fully depleted by December 2024 as expected, Kwale Operations will transition to post-mining as planned."

Other factors at play that influenced the decision, the firm said, included the softening product price outlook for mineral sands and the cost, timing and human impact of a substantial land acquisition and community resettlement programme.

Base Resources acquired the Kwale titanium mine from Canada's Tiomin Resources in 2010, which had for more than a decade failed to transit into an active mine.

Base Resources started exporting titanium ores in 2013.

The firm has since then injected about Sh17 billion into the Kenyan economy through payment of taxes, royalties and payments to local suppliers.

Titanium ore minerals have also emerged as the largest mineral and last year, it accounted for 80 per cent of industry earnings.

Total mineral earnings stood at Sh35.2 billion, according to data by the Kenya National Bureau of Statistics (KNBS), of which Sh28.3 billion was from titanium exports.