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Altona Rare Earths – Monte Muambe Scoping Study Results
Home / Client News / Altona Rare Earths – Monte Muambe Scoping Study Results

Altona (LSE: REE), a resource exploration and development company focused on Rare Earths in Africa, is pleased to announce the positive outcome of its Scoping Study(1) for its Monte Muambe rare earths project in northwestern Mozambique (the “Project”), and the publication of an updated Competent Person Report.


Results of the Scoping Study provide an encouraging initial validation of the Project’s potential, with highlights including:


·     Post-tax NPV 8(2) of US$ 283.3 million


·     Post-tax IRR(3) of 25%


·     Payback from first production: 2.5 years


·   Production of 15,000 tonnes per annum, on average, of Mixed Rare Earth Carbonate (“MREC”), at an average price of US$ 13,558.4 per tonne of MREC(4)


·     18 years Life of Mine (“LoM”)


·     Open pit mining operation, 750,000 tonnes of ore extracted and processed per annum


·  Two stage recovery process, consisting of comminution and flotation, followed by hydrometallurgy


·     LoM EBITDA(5) of US$ 1.67 billion


·     Initial Capex of US$ 276.3 million


The new Competent Person Report containing the Scoping Study, prepared by international geological and mining consultant Snowden Optiro, is available on the Company’s website under the investor section:


The executive summary of the Scoping Study is attached as an appendix to this RNS.


Scoping Study Overview


The Monte Muambe Scoping Study takes into consideration open-pit mining of Target 1 and Target 4, at a LoM strip ratio of 1.6, over a period of 18 years. An anticipated 750,000 tonnes of ore per annum will be extracted and processed through a beneficiation plant to produce a Rare Earths concentrate. The beneficiation process will include crushing, milling and flotation. The concentrate will then be processed through a hydrometallurgical plant to produce an average of 15,000 tonnes of MREC per annum. The hydrometallurgical process will involve a weak acid gangue leach, followed by rare earths leaching and purification. The MREC product would be packaged and transported via existing road infrastructure to the port of Beira, in Mozambique, for export.


Base Case Technical and Economic parameters are summarised in the table below:





Ore processed



MREC produced



Initial Capex



Sustaining Capex



Opex LoM



Opex per ton MREC



Net Revenue LoM






Gross revenue per ton MREC



Payback from first MREC



Post tax NPV 8(2)



Post tax NPV 8(6) Upside Scenario



Post tax IRR



Operating margin




Sensitivity Analysis


Using an NPV of US$283.3 million with an applied real discount rate of 8%, the Project is most sensitive to revenue (price, recovery, grade and exchange rates), less sensitive to opex and least sensitive to capex.



Figure 1 – Project sensitivity analysis


Upside Potential


The Scoping Study demonstrates the potential for Monte Muambe to become a viable mining operation.


Considerable upside potential has been identified in the Scoping Study and will be developed further in the Prefeasibility Study (“PFS”). This includes:


·    Increase of the resource base, as well as of the LoM and/or ore extraction rate;

·    Mining parameters optimisation;

·    Processing and metallurgy, both for the beneficiation and hydrometallurgical plants;

·    Energy sources mix and logistics options;

·   Evaluation of the possibility of doing further onsite, in-country or regional separation and refining; and

·    Setting up Responsible Sourcing systems.


Next Steps


The publication of the Scoping Study marks the end of Phase 2 of the Project Farm-Out Agreement and entitles Altona to an additional 31% ownership in Monte Muambe Mining Limitada, the Project’s special purpose vehicle, taking its total current holding to 51%. Contractual and administrative processes have already been initiated to implement this change and a further announcement will be made when this has been completed.


The Project is now entering Phase 3, which upon completion will allow the Company to increase its holding to 70%, with the key deliverable being the PFS. Preliminary PFS activities started in July this year, in the form of in-fill drilling at Target 4 and these will ramp up over the course of the coming months, with additional exploration, planning and consultant services procurement activities, as well as a strong focus on additional metallurgical test work. The Company intends to also apply for a mining concession during Phase 3.


Cedric Simonet, CEO of Altona, commented: “For Altona, the Monte Muambe Scoping Study is a significant milestone. This key deliverable serves as an affirmative initial validation of the Project’s economic viability, enabling the Company to establish its presence amongst other prospective REE producers in Africa. It provides, together with the Mineral Resource Estimate (“MRE”), a solid foundation for the Project’s subsequent progression.


“As the Project moves into its PFS stage, the Company will continue to work towards de-risking Monte Muambe and, with its local partners, to optimise its technical, commercial and financial parameters. We believe the timing for this achievement is impeccable, at a time where the global rare earths supply chain is diversifying away from China’s decades-long domination, and Western processing facilities are starting to come online.


“The magnet metals present at Monte Muambe (and representing 90% of the Project’s future revenue) are critical components of the global green energy transition. The supply deficit for Neodymium and Praseodymium Oxide is forecast to grow to 90,000 tonnes per year by 2040(7) and, to allow the decarbonisation of energy sources, more magnet metals mines must come on stream in the following years.


“Altona intends to play its part in supporting this crucial agenda, by working in a responsible manner to reduce the dependence on China for critical mineral supplies.




(1)  Under the terms of the Farm-Out agreement of 21 June 2021, Altona will earn a 51% interest in the Monte Muambe Project by delivering the present Scoping Study (Project Phase 2), and a 70% interest by delivering a Prefeasibility Study (Project Phase 3). The results of the Scoping Study are presented on a 100% basis.

(2)  Post-tax Net Present Value using an 8% discount rate for the base case scenario, using Adamas Intelligence low case scenario forecast for the period 2024-2040.

(3)  Post-tax Internal Rate of Return.

(4)  Price based on the average of Adamas Intelligence base-case forecast from 2024 to 2040 for Nd, Pr, Tb and Dy oxides with a payability factor in MREC of 90% for these 4 elements.

(5)  Earnings Before Interest, Tax, Depreciation and Amortisation.

(6)  Post-tax Net Present Value using an 8% discount rate for the upside scenario, using Adamas Intelligence base case scenario forecast for the period 2024-2040.

(7)  Source: Adamas Intelligence, “Rare Earth Magnet Market Outlook to 2040”, Q2 2023.


Scoping Study Cautionary Statement


The Monte Muambe Scoping Study has been prepared to assess the potential viability of an open pit mining and MREC production operation, to assess development options, and to give sufficient confidence to the Company to advance to the Prefeasibility Study stage. The results of the Scoping Study should not be considered a profit forecast or a production forecast.


The Scoping Study is preliminary in nature and include material assumptions outlined in the CPR, including product price assumptions. Capex estimates qualify as Class 4 estimates as per the Association for the Advancement of Cost Engineering Recommended Practice 47R-11. The accuracy of the opex and of the initial capex estimate is assessed at +35% to −30%.


The base case includes an indicative life of mine extraction and production schedule, which is based on a Mineral Resource Estimate, 58% of which classified as Indicated and 42% as Inferred. The assessments contained in the Scoping Study are insufficient to support the estimation of Ore Reserves or, at this stage, to provide assurance of an economic development.


Further evaluation work including infill drilling, metallurgical test work, engineering and environmental studies will be required to support the estimation of Ore Reserves, and to provide assurance of an economic development case.


The Scoping Study must be read and considered as a whole. Selection of portions of the analysis or factors considered by it, without considering all factors and analyses together, could create a misleading view of the process underlying the opinions presented in the Scoping Study and CPR.


Monte Muambe Scoping Study Results – 07:00:11 18 Oct 2023 – REE News article | London Stock Exchange


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