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High Court defers ruling on Sandpiper project

The Namibian High Court has deferred its decision on an application filed by the Confederation of Namibian Fishing Associations and three other parties questioning the validity of Namibian Marine Phosphate’s (NMP) Sandpiper mining license to April 12.

The judgment was scheduled to be delivered on March 8 after a hearing in July of last year, but the judge was on leave at the time.

Due to environmental concerns, the project has been in limbo since 2012, with its environmental clearance certificate being revoked after it was granted in 2016.

NMP’s Sandpiper project is about 60 km off the coast of Namibia and 120 km south-west of Walvis Bay. The licence covers a 2 233 km2 area in water depths of 180 m to 300 m.

NMP is 85%-owned by Omani-registered entity Mawarid Mining and Havana Investments, a Namibian registered entity.

The project has reserves of 132-million tons, grading 20.41% phosphorous pentoxide and mineral resources of 1.69-billion tons, grading 18.94% phosphorous pentoxide.

A 2013 definitive feasibility study (DFS) on Sandpiper envisioned a three-million-tonne-a-year phosphate rock concentrate project, grading about 28%, over an initial mine life of 20 years.

The company plans to contract an international company to dredge seafloor sediments with a large-capacity trailing suction hopper dredge.

Autonomous and remote-controlled underwater vehicles can be used to assist in positioning ships and to obtain environmental monitoring information over long periods, without the need for expensive support vessels.

Following a final investment decision and securing financing for the project, the construction and commissioning period will be 24 months.

CEO Chris Jordinson says that while the world focuses on alleviating the deeply human and economic impacts of the Covid-19 pandemic, analysts forecast that the mineral market is likely to see positive growth from 2020 to 2030, which is, in part, owing to increased consumer awareness around climate change.

He adds that phosphate prices managed to recover upwards of 20% in February, compared with pre-Covid levels. Demand for phosphate is forecast to have grown 13 times by 2030, becoming the third-highest increased-in-demand metal required for the production of lithium ferrophosphate batteries in electric vehicles (EVs).

Establishing a phosphate-based industry could position Namibia to meet the future global demand for phosphate to fuel the EV battery market.

An environmental clearance certificate for the project was issued in September 2016 after NMP had completed public consultations, a formal application for environmental clearance in 2012, an updated DFS in 2013 and a N$14-million comprehensive environmental-impact verification study in 2014.

Since then, despite a consensus of expert opinion that the proposed scale of activities would have no significant impact on the marine ecosystem or the Namibian commercial fishing industry, project development has been delayed by various legal actions initiated in November 2016, which are based largely on scientifically unsupported environmental objections, says NMP.

As a consequence of an appeal lodged in 2016, the project’s environmental clearance certificate was set aside in June 2018 by the Ministry of Environment, Forestry and Tourism to complete a further six-month period of consultation and evaluation with the public, the fishing industry and the Ministry of Fisheries and Marine Resources.

The process was completed in December 2018 but awarding of the certificate remains pending a decision from the Environmental Commissioner.

In 2019, NMP responded to certain recommendations put to the Environmental Commissioner by the appointed external reviewers of the further consultation process conducted in 2018.

NMP completed and submitted two additional specialist environmental studies to the Environmental Commissioner, as well as additional detailed information for consideration in the award of the environmental clearance certificate.

On July 7 last year, the legal challenge on the validity of NMP’s mining licence (ML170) was heard in the High Court of Namibia, and NMP remains confident of a successful outcome.

Jordinson says the associations can appeal the court’s ruling, which would bring about further delays to the project; however, they would have to have good grounds for such an appeal.

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