Lotus Resources Limited (ASX: LOT | OTCQX: LTSRF) has announced that it has signed a Mine Development Agreement (MDA) with the Government of Malawi for its Kayelekera uranium mine, a major milestone in its redevelopment. This agreement ensures the mine will operate under a stable fiscal regime and provides the necessary confidence to investors.
Lotus managing director, Keith Bowes, commented, “We are extremely pleased to have finalized our MDA with the Malawian Government. I would like to thank all parties involved in these negotiations, especially the Presidential Delivery Unit who were instrumental in finalizing the agreement. The relevant ministries including mining, finance and justice have all been very supportive in our negotiations as we have gone through multiple iterations of the MDA.”
Highlights of the MDA include:
- MDA secures a stable fiscal regime for the operations
- MDA guarantees a stability period of 10 years during which the project will not be subject to any detrimental changes to the fiscal regime
- Key tax terms are aligned with the restart DFS assumptions, including royalty rate of 5% and corporate tax rate of 30%
- Relief provided on resource rental tax and withholding tax, specifically as it applies to dividends to non-residents
- Exemptions for import and export duties, excise and VAT on capital goods and specified consumables directly related to mine production
- MDA demonstrates the commitment by the government of Malawi to develop the local mining industry, a key pillar of Malawi 2063, their new economic vision
- MDA demonstrates the commitment by the GoM to develop the local mining industry, a key pillar of Malawi 2063, their new economic vision
- Lotus has a cash balance of A$34.1M, exclusive of restricted cash of A$15.0M, at 30 June 2024
Moving forward, the company will complete offtake negotiations for the first phase of contracting. Offtake agreements may have a pre-payment component to support the project financing. It will also complete the FEED programme and finalize project financing.
To find out more, please visit www.lotusresources.com.au
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