Can Lindian Deliver on Ambitious Rare Earths Expansion Without Cost Overruns?
Lindian Resources has optimised its Kangankunde Rare Earths Project, increasing ore processing capacity by 25% and appointing Obsideo as the design and construction contractor for its processing plant. This upgrade significantly enhances the project's financial outlook while keeping capital costs within budget.
- 25% increase in ore processing capacity to 20,000 tonnes per annum
- 45% rise in project NPV to A$1.725 billion
- 38% increase in annual EBITDA to A$171 million
- Obsideo appointed as Design & Construct contractor
- Capital costs remain within 10% of original feasibility estimate
Optimisation Drives Production Growth
Lindian Resources has taken a significant stride forward in developing its Kangankunde Rare Earths Project in Malawi by optimising its process plant design. The company announced a 25% increase in ore processing capacity, boosting annual monazite concentrate production from 15,300 to 20,000 tonnes. This enhancement is a critical step in meeting the strong demand for Kangankunde’s premium monazite concentrate, which contains high-grade rare earth oxides.
The optimisation not only increases throughput but also improves metallurgical performance and operational flexibility. Key design changes include replacing multi-stage crushing and ball milling with a simplified single-stage crushing and SAG mill circuit, and upgrading classification methods to cycloning. These refinements reduce recovery risk and streamline the processing flowsheet.
Financial Upside and Cost Discipline
From a financial perspective, the project’s net present value (NPV) has surged by 45% to A$1.725 billion, while annual EBITDA is projected to rise by 38% to A$171 million. These gains are supported by a 30% reduction in mining costs following Lindian’s adoption of an owner-operator mining model. Importantly, the pre-production capital cost estimate remains within 10% of the original feasibility study, preserving the project’s funding envelope of US$40 million.
Executive Director Zac Komur highlighted the significance of these improvements, noting that the optimisation materially enhances the project’s financial metrics and aligns with the company’s schedule for first production in late 2026. The disciplined approach to cost management and schedule adherence will be critical as Lindian transitions Kangankunde into full construction.
Obsideo Secured for Design & Construction
Lindian has appointed Obsideo, a South African engineering and project delivery group, as the preferred Design & Construct (D&C) contractor for the Stage 1 processing plant. Obsideo brings relevant rare earths processing experience, having successfully commissioned the Gakara Rare Earths Minerals Plant in Burundi. Their scope covers full engineering, procurement, construction, and commissioning of the optimised plant.
Obsideo’s appointment followed a competitive tender process emphasizing technical expertise, commercial terms, and schedule alignment. The contract includes risk and reward mechanisms to ensure cost, schedule, safety, and performance targets are met. CEO Cobus Robertson expressed enthusiasm about delivering the processing plant on schedule, reinforcing Obsideo’s position as a leader in rare earth mineral processing.
Strategic Positioning in Rare Earths Market
Kangankunde’s enhanced production capacity and robust economics position Lindian as a significant player in the global rare earths sector. The project benefits from strong infrastructure, government support, and strategic partnerships, including a recent collaboration with Iluka Resources. With all key approvals in place and early construction underway, Lindian is well placed to meet growing demand for critical minerals essential to clean energy technologies and advanced manufacturing.
As the company advances detailed engineering and procurement, the market will be watching closely to see how effectively Lindian manages construction risks and capital discipline while progressing toward first production in Q4 2026.
Bottom Line?
Lindian’s process plant optimisation and Obsideo partnership mark a pivotal advance, setting the stage for Kangankunde’s emergence as a rare earths powerhouse.
Questions in the middle?
- How will Lindian manage potential construction and commissioning risks with the new process design?
- What are the implications of global rare earth market fluctuations on Kangankunde’s long-term profitability?
- Will Lindian secure additional offtake agreements to fully capitalise on the increased production capacity?
