Base Resources, the owner of the Kwale mineral sands mine in Kenya, has announced that production for fiscal 2024 is going to be lower compared to fiscal 2023. The company has confirmed its guidance for the year but has also stated that half of the mining operation will shut down in March 2024. The purpose of the shutdown is to relocate hydraulic mining units. In addition, the remaining sections of the South Dune and the areas of the North Dune and Bumamani ore bodies proposed to be mined in fiscal 2024 are estimated to have lower heavy mineral grades than the grades historically mined at Kwale.
Base Resources estimated that mining rates in fiscal 2024 would be less than in fiscal 2023, which ends on June 30. The company has provided production guidance for fiscal 2024 as follows:
- Rutile production: expected to be between 35,000 metric tons to 41,000 metric tons, compared to the current year guidance of 62,000 tons to73,000 tons.
- Ilmenite production: estimated to be in the range of 130,000 tons to 160,000 tons, compared with expectations of 260,000 tons to 310,000 tons for fiscal 2023.
- Zircon production: expected to be between 13,000 tons to 16,000 tons compared with the current year outlook of 22,000 tons to 27,000 tons.
The shares of Base Resources were down by 0.55 pence or 6% at 8.65 pence at 0724 GMT.
Base Resources has admitted that production levels are likely to decrease in fiscal 2024. The shutdown of half the mining operation for the relocation of hydraulic mining units and lower heavy mineral grades are factors that would impact mining rates. The company has provided production guidance for fiscal 2024 with lower expectations for rutile, ilmenite, and zircon production compared to the current year.