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Lindian, Kangankunde project vendors to hold mediation talks


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Lindian, Kangankunde project vendors to hold mediation talks

Australian explorer Lindian Resources Ltd. will undertake a formal mediation process in April in a bid to end a long-running battle around a disputed option agreement for up to 75% of the Kangankunde rare earths project in Malawi.

Lindian won an injunction in November 2018 that prevented Rift Valley Resources Corp. unit Rift Valley Resource Developments Ltd. and geologist Michael Saner from dealing with the project or Rift Valley shares.

Lindian launched legal proceedings against Rift Valley and Saner in Malawi and South Africa after the vendors wrote to Lindian to cancel an existing agreement on the basis of "changed circumstances" in Malawi. The vendors offered to enter into a separate deal, which Lindian said was on entirely different terms, involving the sale of the project for US$70 million as well as a 5% royalty to Rift Valley shareholders.

Discussions between Lindian and the vendors had been ongoing since the injunction was granted but the dispute remains unresolved. The company said in a March 20 release that will proceed with its high court action in Malawi and a formal mediation process had been set down to commence on April 16.

The Kangankunde deposit has been reported as one of the world's largest rare earths projects outside China.

Separately, Lindian announced that it had completed its 51% stage-one acquisition of East Africa Bauxite Ltd., the company that wholly owns the Lushoto and Pare bauxite projects in Tanzania. It said the 10 million shares required under this earn-in stage will be issued by Dec. 31, subject to any shareholder reapprovals.

The company recently announced that it is preparing to drill at both projects and is also in advanced talks about another "synergistic" bauxite project.