Tiomin puts Kwale on hold

After a deal to sell a half-interest in the project fell through, Tiomin Resources (TIO-T) has stopped development work on the Kwale mineral sands mine in southeastern Kenya.

Tiomin announced that its lenders had withdrawn a US$155-million project loan because the project was not on schedule, and that it would place the project on hold for at least seven months. In the meantime it was having its consultants review cost saving measures for the project.

ATW Venture (ATW-V), which had previously agreed to buy 50% of the Kwale project for US$35 million, pulled out of the deal on Feb. 2.

Zircon and rutile prices are still high, and Tiomin said it expects to have a feasible project once costs are reviewed.