The argument by the Organisation for Economic Cooperation and Development (OECD) that tightening South Africa’s wealth tax regime would rebalance ... generational inequality has a fundamental flaw: it targets a “flighty” base, says an expert from the African Tax Institute.
Taylor-Wilkinson has set up local companies in the two countries, as well as in Tanzania, to enable applications for rare-earths prospecting licenses. There are two targets which interest the company in Angola, and one in Uganda, he says.
Rare earths are crucial to energy transition, being needed for electric vehicles, solar panels and wind power turbines. The International Energy Agency has said that global demand for rare earths by 2040 could be three to seven times higher than it is now. Domination of the global supply by China is leading to a scramble to secure alternative sources, with the US and Australia increasing production.
Due to its geology, Angola is “the biggest target jurisdiction” for rare earths in Africa, Taylor-Wilkinson says. One of the targets he is considering in the country is at Bailundo, where exploration has taken place on and off for the last 40 years. The complex ownership claims on the resource may mean that other targets are easier, Taylor-Wilkinson says.
Altona shares currently trade on the Aquis exchange in Europe for small companies. Taylor-Wilkinson is planning a transfer to a listing on the London stock exchange, to be combined with fundraising of 2m pounds. He’s aiming to complete the listing in the next six weeks.
- The company is separately planning a rare earths acquisition in an undisclosed location. That will be completed once the company’s shares have been listed on the London exchange, Taylor-Wilkinson says.
Processing in Burundi?
Altona’s existing rare earths project is at Monte Muambe in Tete province, northwest Mozambique. Phase one test results were good enough to justify proceeding to phase two drilling, Altona said this month. The project area is about 30 kilometres off a tarred road linking Mozambique to Malawi. There are plans to extend the road to the site, and it is possible that company will have to contribute to the work, Taylor-Wilkinson says.
About 1.2m pounds of the planned fundraising will be needed for phases two and three of the Mozambique project. The company is likely to need to raise between 3.5m to 4m pounds over the next 18 months to two years.
Taylor-Wilkinson bought shares in the company in December, taking his stake to 6.3%. The prospect, he says, is that some of Africa’s rare earths projects may be worth tens or hundreds of millions of pounds in future. All of the continent’s known rare earths resources will have been snapped up within five years, he says. “The trick is to find a project that has been forgotten about.”
A further problem for global industries which need rare earths users, Taylor-Wilkinson says, is that processing capacity is concentrated in China. Africa, he says, may be able to develop processing capability.
- The government of Burundi has been in touch with him to gauge interest in investing in a processing facility.
- Burundi has been in dispute with AIM listed Rainbow Rare Earths over the terms of the mining convention for the Gakara resource.
- A processing facility might cost about 200m pounds and is too expensive for a small company like Altona, Taylor-Wilkinson says.
- But, he adds, it could be a feasible project for someone with more financial firepower.
Altona sees African rare-earth exploration licenses as worth the risk in the context of limited global supply options.
Understand Africa's tomorrow... today
We believe that Africa is poorly represented, and badly under-estimated. Beyond the vast opportunity manifest in African markets, we highlight people who make a difference; leaders turning the tide, youth driving change, and an indefatigable business community. That is what we believe will change the continent, and that is what we report on. With hard-hitting investigations, innovative analysis and deep dives into countries and sectors, The Africa Report delivers the insight you need.View subscription options