ASX-listed Sovereign Metals has entered into a nonbinding memorandum of understanding (MoU) with the Electricity Supply Corporation of Malawi (ESCOM) to ensure the long-term supply of electricity to its Kasiya rutile graphite project, in Malawi.

The MoU establishes the framework for negotiating future definitive agreements, including for the construction and installation of a new 132 kV overhead power line and a power supply agreement for the provision of bulk power supply from Malawi’s national grid.

Sovereign says the MoU follows discussions with ESCOM, the operator of Malawi's national electricity grid, regarding the provision of electricity to the Kasiya project in preparation for construction and operation.

The total installed capacity in Malawi is currently 351 MW, with about 98% of this capacity coming from hydropower.

The company describes the MoU with ESCOM as a key step in the development of Kasiya and its definitive feasibility study (DFS) due in the fourth quarter of this year.

Sovereign points out that the World Bank, on May 15, approved a $350-million grant to support Malawi’s Mpatamanga Hydropower Storage Project (MHSP), a large infrastructure operation that the World Bank says is aiming to “transform the country’s energy landscape and its economic development trajectory”.

Once complete, the $1.5-billion MHSP will deliver 358 MW of additional generation capacity to the Malawi electricity grid.

“The signing of the MoU ensures we have a work plan to secure access to a renewable, hydro-based power supply for Kasiya. The future development of the MHSP – expected to commence operations in 2030 – will further enhance the stability and capacity of Malawi’s electricity network,” says MD and CEO Frank Eagar.

KASIYA POWER SUPPLY

Over its planned 25-year life-of-mine, Kasiya is set to produce an average of 222 000 t of natural rutile and 233 000 t of natural flake graphite a year.

To supply power from the hydro-based grid network, a 132 kV overhead transmission line will be built to connect the Kasiya site to the Nkhoma substation, about 97 km away.

The company says Nkhoma has been identified as the most suitable connection point based on power reliability, technical feasibility and environmental and social considerations.