Staff Reporter
INDEPENDENT fisheries management scientist, Dr Carola Kirchner, says available evidence of Sandpiper Marine Phosphate mining is incomplete and partly outdated. Dr Carola Kirchner holds a Bachelor of Science (BSc) fro
m the University of Southern California (US), a Bachelor of Science Honours (BSc Honours) from the University of Cape Town (UCT), a Master of Business Administration (MBA) from UCT and a Doctor of Philosophy (PhD) from Nelson Mandela University (NMMU), released a researched opinion piece questioning the economic case.
Kirchner said the key concern was not simply the current phosphate price, but the project’s exposure to commodity-price volatility over its proposed 20-year mine life, as well as unresolved questions surrounding the land-based processing facility and its freshwater requirements.
She said it would be premature to conclude that the project is uneconomic, but equally premature to treat the economic benefits cited by Namibian Marine Phosphate (NMP) as established without updated project-level financial and environmental information.
In her review of the Sandpiper project, Kirchner said the project would be particularly exposed to fluctuations in phosphate prices because of its long operating life.
World Bank monthly data, according to the review, show North African phosphate rock prices ranging from US$44 per tonne to US$450 per tonne since 2006. The benchmark remained below US$150 per tonne for 101 consecutive months between June 2013 and October 2021, and below US$120 per tonne for 64 consecutive months between February 2016 and May 2021.
The annual average price subsequently fell from about US$324 per tonne in 2023 to US$152.50 per tonne in 2024, a decline of about 53%. The July 2026 price was recorded at US$170 per tonne.
Kirchner said an indicative production cost of about US$38 per tonne for 27.5% P₂O₅ concentrate in a 2018 Stratecon model should be regarded as a historical reference rather than a current break-even estimate.
She said current costs associated with the land-based processing plant, freshwater supply, dredging, contractors, energy, port charges, financing, maintenance and other operations had not been adequately demonstrated.
The review also raises questions about the consistency of revenue and pricing assumptions contained in the project’s 2022 Environmental and Social Impact Assessment (ESIA).
The ESIA refers to a June 2022 North African benchmark price of US$287.50 per tonne, while also estimating annual Sandpiper revenue of N$4.2 billion at full production of three million tonnes per year.
Using the ESIA’s stated capital expenditure conversion, Kirchner calculates that the projected revenue would imply an approximate realised price of US$87 per tonne. She said the difference could relate to product grade, net realised prices, older assumptions or other commercial adjustments, but should be explicitly reconciled.
Kirchner said an important issue was that Sandpiper would not simply dredge offshore material and sell it directly.
The marine operation would recover and transport sediment to Walvis Bay, where a separate land-based facility would process and beneficiate it into the 27–28% P₂O₅ phosphate concentrate intended for export.
She pointed out that the 2022 marine ESIA describes the land-based process as being provided “for information purposes only” and says it does not form part of the impact assessment.
The ESIA also indicated that the site allocation for the buffer pond, processing plant and tailings dam was still pending.
According to Kirchner, the ESIA states that the land-based component requires a separate environmental assessment and Environmental Clearance Certificate based on a revised layout, and that both the marine and land components require permitting before full-scale production can begin.
“This means marine clearance alone is insufficient to create an operating phosphate-export project,” the review argues.
Kirchner said the absence of a completed assessment and clearance for the land-based component also leaves questions about the project’s overall environmental and economic viability.
Freshwater supply is another unresolved issue, she said.
The beneficiation process requires clean water to wash salt residue from the filtered concentrate, while the 2022 ESIA indicates that options for supplying freshwater, including reverse osmosis, were still being investigated.
Kirchner said the available material did not provide a final water source or quantified freshwater demand.
For a large industrial operation in Namibia’s arid coastal environment, she said, the volume and source of freshwater, competing demands, supply infrastructure and associated energy requirements are material considerations.
If reverse osmosis is selected, the infrastructure, energy consumption and waste-stream management associated with the process would also need to be assessed, she said.
Kirchner said a credible economic assessment should test the project against a range of phosphate prices rather than relying on a single price assumption.
She recommended sensitivity testing at sustained realised prices of about US$80, US$100, US$120, US$150 and US$170 per tonne, alongside updated operating and financing costs.
She said these should not be regarded merely as artificial stress scenarios because phosphate prices have historically remained within or below those levels for extended periods.
The available information does not demonstrate whether Sandpiper would be able to service debt, maintain contractor operations and generate projected tax and royalty benefits during a prolonged period of low prices, according to the review.
“Until an updated project-level cash-flow model is available, it is premature either to describe the project as uneconomic or to assume that the economic benefits quoted in the ESIA are secure,” Kirchner said.
Kirchner also cautioned against attributing broader projected economic benefits to the Sandpiper operation alone.
She said the Stratecon model combined NMP and LL Namibia Phosphates, expanded concentrate production, downstream fertiliser manufacturing, indirect and induced multiplier effects, and gains in subsistence agriculture.
As a result, projected figures such as approximately 51 600 jobs and large contributions to GDP could not be attributed solely to the current Sandpiper mining operation.
For the offshore mining operation itself, the ESIA refers to approximately 72 to 100 vessel and land-support jobs.
The labour plan includes 40 local vessel employees and indicates that expatriate staff would also be used because Jan De Nul is the main dredging contractor. Elsewhere, the ESIA estimates 56 expatriates.
Kirchner said construction employment, direct operational employment and economy-wide multiplier estimates should therefore be distinguished.
She highlighted figures contained in Jan De Nul’s socio-economic information, which estimates local purchases and subcontracting at about US$14.57 million per year from the third year onwards, while local salaries are estimated at approximately US$1.48 million per year.
“These are real potential benefits, but they are much narrower than the headline national-industry figures and should be presented as such,” she said.
Kirchner further said domestic fertiliser manufacturing and benefits to subsistence agriculture would not automatically result from phosphate mining.
Such benefits would require additional capital investment, processing facilities, markets, distribution networks and affordable fertiliser uptake in Namibia.
The review also raises questions about Sandpiper’s position in the international phosphate market.
The project proposes producing a 27–28% P₂O₅ concentrate at an annual production rate of three million tonnes.
Kirchner noted that the North African benchmark cited in the ESIA historically referred to a higher-grade 32% P₂O₅ product.
She said Sandpiper’s actual realised price would therefore depend on factors including product grade, solubility, impurities, customer specifications, freight and contractual arrangements.
Morocco is identified as an important comparator, with the United States Geological Survey identifying Morocco and Western Sahara as holding the world’s largest known phosphate reserves.
OCP, Morocco’s state-owned phosphate company, reports phosphate-rock production capacity of about 50 million tonnes per year and is vertically integrated into phosphoric acid and fertiliser production.
Kirchner said Sandpiper would enter the market as a much smaller new supplier and that an updated economic assessment should therefore include evidence of potential customers, product qualification, offtake arrangements, expected price discounts or premiums and shipping costs.
Kirchner also questioned whether the fisheries baseline used in the ESIA adequately reflects recent developments in Namibia’s small-pelagic fishery.
She said the baseline is largely based on older studies and data, while recent surveys have provided new information on the recovery of the Namibian pilchard stock.
The ESIA’s 2014 verification survey, for example, did not catch small pelagic species because the bottom-trawl gear used was not designed to catch sardine, anchovy and other non-demersal species.
Kirchner said the existing assessment therefore should not be regarded as a contemporary assessment of pilchard abundance in the proposed mining area.
A 2025 Ministry of Fisheries and Marine Resources/Namibia Fisheries and Marine Resources Institute survey estimated total sardine biomass at approximately 887 739 tonnes, with a coefficient of variation of 40%.
The survey found that sardine was primarily concentrated in the southern part of the survey area between 22°S and 25°S, with the highest densities recorded inside the 200-metre depth contour and smaller groups farther offshore.
Kirchner said the findings did not establish that Sandpiper dredging would damage the sardine stock, but represented important new information that should be incorporated into the project’s fisheries assessment.
She called for an updated, species-specific assessment examining spatial overlap, sediment-plume exposure and potential food-web effects, noting the ecological importance of pilchard beyond the commercial fishery.
Kirchner’s overall conclusion is that the available evidence does not justify a simple declaration that Sandpiper is uneconomic.
Instead, she argues that the economic case currently available is incomplete and partly outdated.
She said NMP should provide the land-based ESIA and Environmental Clearance Certificate, including quantified freshwater requirements and a defined supply solution.
She also called for an updated full-project feasibility and sensitivity analysis covering the expected realised selling price for the 27–28% P₂O₅ product, current capital and operating costs for both marine and land-based operations, water and energy costs, debt servicing, shipping and port costs, and tax and royalty assumptions.
The analysis should also demonstrate how the project would perform during prolonged periods of low phosphate prices, she said.
“Until then, the magnitude and durability of the claimed economic benefits cannot be treated as established,” Kirchner concluded.
Photos: Namibian Marine Phosphate/ResearchGate
PICTURED: Independent Fisheries Management Scientist Dr Carola Kirchner, who has called for updated economic, environmental and fisheries assessments of the Sandpiper Marine Phosphate Project. Photos: Namibian Marine Phosphate/ResearchGate
