Production pause at Kayelekera highlights African mining’s hidden risks

Supply chains and geopolitics could determine success.

By Leon Louw founder of WhyAfrica and Endorphin Expeditions.

The success of a mining project is often judged by the size of the resource, commodity prices and management expertise. However, the temporary production pause at Lotus Resources’ Kayelekera Uranium Mine in the far north of Malawi highlights several risks that has nothing to do with geology.

Today mining operations are increasingly dependent on global supply chains and geopolitical stability.

At Kayelekera recent disruptions to sulphur and sulphuric acid supplies mostly linked to the crisis in the Middle East, adversely affected production.

World events and the impact on mining projects

The temporary halt in production is an example of how world events can have a direct impact on African mining projects, especially those reliant on imported consumables.

In addition to these difficulties, Kayelekera’s acid plant encountered commissioning difficulties after refractory bricks within the sulphur furnace showed signs of failure.

Commissioning of the processing plant is one of the highest-risk stages of any mining development, and seemingly minor technical components can delay production schedules and affect cash flow. Successful mine construction alone does not guarantee a smooth transition to steady-state operations.

Logistics, infrastructure and geology

Logistics and infrastructure are equally critical considerations. Malawi’s landlocked geography means that uranium produced at Kayelekera must travel through multiple countries before reaching international markets.

The export route requires trucking material through Zambia or Tanzania for shipment to Europe or the East. Border crossings, transport permits and regulatory approval introduce potential delays and additional costs. Road conditions, transport reliability and regional infrastructure therefore become just as important as mining performance itself.

The permitting process further underlines the complexity of operating in emerging mining jurisdictions. Lotus has secured several approvals but continues to work through a range of transport, environmental and radiation-related permits across multiple countries. Such regulatory requirements are entirely normal for uranium projects, yet they illustrate why investors should carefully evaluate licensing frameworks and administrative capacity when assessing opportunities in Africa.

Projects are more than good orebodies

Perhaps the most important lesson is the role of funding. As Kayelekera moves through this challenging phase, access to funding will be critical to maintaining momentum and restoring confidence.

Kayelekera is once again a good example to illustrate that mining projects require more than a good orebody. Supply chains, infrastructure, geopolitics, permitting and funding can ultimately determine whether a project achieves its full potential or not.

Image: The Kayelekera processing plant in 2023 when WhyAfrica visited the project as part of the WhyAfrica Road Trip. Image credit: Leon Louw.

Leon Louw provides independent consulting services to investors, businesses and organisations seeking a deeper understanding of Africa’s political, economic and natural resource landscape.

Production pause at Kayelekera highlights African mining’s hidden risks