Sovereign Metals shares jump 10% as Kasiya feasibility study confirms $2.2bn project value Proactive uses images sourced from Shutterstock

Shares in Sovereign Metals Ltd (ASX:SVM, OTCQX:SVMLF, AIM:SVML, FRA:SVM) rose 10% to 40.20p after the company published a definitive feasibility study for its Kasiya rutile and graphite project in Malawi, confirming a pre-tax net present value of $2.2 billion against initial capital expenditure of $727 million.

The study, completed with technical oversight from Rio Tinto Ltd (LSE:RIO, ASX:RIO, OTC:RTNTF), projects steady-state annual EBITDA of $476 million and free cash flow of $452 million over a 25-year mine life, with total revenue of $16.2 billion.

Kasiya hosts the world's largest natural rutile deposit and the second-largest flake graphite deposit, with the project expected to produce 222,000 tonnes of rutile and 275,000 tonnes of graphite annually at full capacity.

Both minerals are classified as critical by the United States and the European Union, with titanium in particular facing acute supply chain pressure as China accounts for 70% of global titanium sponge production and the US remains 100% import-dependent.

Non-binding offtake agreements cover more than 50% of Stage 1 rutile production with Japanese trading house Mitsui and more than 35% of coarse flake graphite sales with commodity trader Traxys.

The project also produces monazite, a rare earth mineral containing dysprosium, terbium and yttrium, all subject to Chinese export restrictions, which Sovereign is separately evaluating as a potential third revenue stream.

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