Hope for titanium mining as Australian firm begins tests

The Australian firm that acquired titanium mining rights from Tiomin Kenya in July this year has launched a new feasibility study at the site in Kwale, targeting to launch full-scale operations in two years’ time.

Base Titanium Ltd has started geological drilling to update the feasibility study done four years ago, which it will use to secure capital for the project to start off in the second quarter of 2011

“We have so far drilled 52 holes, some as deep as 70 metres and collected various samples that are being analysed in our laboratories in Ukunda,” Mr Edwin Owino, one of the geologists working on the project, said at Maumba where the team will drill about 100 holes.

The samples so far indicate rich deposits. Test results have shown deposits of high grade titanium as high as 25 per cent per 300 gramme sample.

Titanium mining in Coast has had false starts for 16 years since the first exploration was done in Kwale by Tiomin Resources of Canada.

Base Resources Ltd acquired the mining business from Tiomin Kenya, a subsidiary of Vaaldiam Mining Inc of Canada (formerly Tiomin Resources Inc).

“The acquisition followed completion of a satisfactory due diligence, securing the consent of the government of Kenya and completion of a Sh640 million (US $ 8 million) capital raising,” Mr Joe Schwarz, the Base Titanium general manger, said.

Specialist resource sector corporate advisory firm, RFC Corporate Finance, has been engaged to assist the firm to secure development finance for the project estimated at $200 million (Sh16 billion).

“Construction of the mining plant will commence mid next year and expected to take 18-21 months,” Schwarz said. It will be ready for large scale production in 2013.

The road to Tiomin mining has been very rough, especially in getting clearance, which has seen the company sink $60 million (Sh3.6 billion) in the last 14 years, Sh480 million as compensation for displaced residents.