Staff Reporter
THE economic case for the Sandpiper Marine Phosphate Project remains incomplete, with an independent review finding that updated financial, environmental and fisheries assessments are needed before the project’s projected economic benefits can be regarded as established.
The review, conducted by independent Fisheries Management Scientist Dr Carola Kirchner, concludes that the available evidence does not support declaring Sandpiper uneconomic, but also does not provide sufficient basis to establish the scale and durability of its projected benefits.
Kirchner earned a Bachelor of Science (BSc) from the University of Southern California in the United States, 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).
The review expands on concerns raised in an earlier article about Sandpiper’s economic case, particularly its exposure to volatile phosphate prices, the unresolved land-based processing component and uncertainty over freshwater requirements.
Kirchner argues that the central economic concern is the project’s proposed 20-year operating life and its exposure to potentially prolonged periods of low phosphate prices.
World Bank monthly data show North African phosphate rock prices ranging from US$44 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 declined from about US$324 per tonne in 2023 to US$152.50 per tonne in 2024, a drop of about 53%. The July 2026 benchmark was US$170 per tonne.
Kirchner argues that the approximately US$38 per tonne production cost used in a 2018 Stratecon model should not be treated as a current break-even figure.
The review describes the model as useful as a historical reference, but notes that current costs for the revised land-based processing plant, freshwater supply, dredging, contractors, energy, port charges, financing, maintenance and other operations have not been demonstrated.
The review also identifies an apparent inconsistency in the project’s pricing and revenue assumptions.
The 2022 Environmental and Social Impact Assessment (ESIA) refers to a June 2022 North African benchmark price of US$287.50 per tonne, while estimating annual Sandpiper revenue of N$4.2 billion at full production of three million tonnes per year.
Using the exchange rate applied in the ESIA, Kirchner calculates that the projected revenue translates to an approximate realised price of US$87 per tonne.
She notes that the difference could be explained by factors such as product grade, net realised prices, older assumptions or other commercial adjustments, but says it should be explicitly reconciled in an updated economic assessment.
A key issue identified in the review is the distinction between Sandpiper’s marine mining operation and the land-based processing facility.
The marine operation would recover and transport sediment to Walvis Bay, while a separate land-based facility would process and beneficiate the material into the 27–28% P₂O₅ phosphate concentrate intended for export.
Kirchner points 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 site allocation for the buffer pond, processing plant and tailings dam was still pending.
According to the review, the ESIA requires the land-based component to undergo a separate environmental assessment and obtain an Environmental Clearance Certificate based on a revised layout. Both the marine and land-based components would need the necessary permitting before full-scale production could begin.
Kirchner therefore argues that marine clearance alone would not be sufficient to establish an operating phosphate-export project.
Freshwater supply is another unresolved issue. The beneficiation process requires clean water to wash salt residue from the filtered concentrate, while the 2022 ESIA indicates that potential freshwater supply options, including reverse osmosis, were still under investigation.
The review notes that no final water source or quantified freshwater demand is provided in the material assessed.
Kirchner says this is particularly significant given the arid Namibian coastal environment, where the volume and source of freshwater, competing demands, supply infrastructure and energy requirements would have environmental and economic implications.
If reverse osmosis is selected, the review says, the associated infrastructure, energy consumption and waste-stream management would also need to be assessed.
The unresolved land-based component also affects the project’s economic calculations, according to the review.
Kirchner argues that the relevant measure should be the full cost of producing a saleable tonne of concentrate rather than the cost of dredging alone. Current capital and operating costs for the land-based plant and its freshwater solution should therefore be incorporated into an updated break-even and sensitivity analysis.
She recommends that Sandpiper be tested against sustained realised phosphate prices of approximately US$80, US$100, US$120, US$150 and US$170 per tonne, alongside updated operating and financing costs.
Kirchner says the lower price scenarios are not merely artificial stress tests, as phosphate prices have historically remained within or below those levels for extended periods.
The review does not demonstrate whether the project would be able to service debt, maintain contractor operations and continue generating projected tax and royalty benefits during a prolonged low-price period.
The review also cautions against attributing broad economic projections to the current Sandpiper operation alone.
Kirchner notes that the Stratecon model combined Namibian Marine Phosphate (NMP) and LL Namibia Phosphates, expanded concentrate production, downstream fertiliser manufacturing, indirect and induced economic effects and gains in subsistence agriculture.
Consequently, projections such as approximately 51 600 jobs and large GDP contributions should not be presented as benefits generated solely by 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 personnel would also be used because Jan De Nul is the main dredging contractor. Elsewhere, the ESIA estimates 56 expatriates.
The review also cites Jan De Nul socio-economic estimates of approximately US$14.57 million in local purchases and subcontracting annually from the third year onwards, alongside about US$1.48 million in local salaries.
Kirchner says these represent potential local benefits, but are considerably narrower than the broader national-industry projections.
She also cautions that domestic fertiliser manufacturing and benefits to subsistence agriculture would not automatically follow from phosphate mining.
Those outcomes would require additional investment in factories, markets, distribution systems and affordable fertiliser uptake, and should therefore be considered separate future-development scenarios.
Market conditions also require further examination, according to the review.
Sandpiper proposes producing three million tonnes per year of 27–28% P₂O₅ concentrate. Kirchner notes that the North African benchmark cited in the ESIA historically referred to a higher-grade 32% P₂O₅ product.
The project’s achievable selling price would therefore depend on factors including grade, solubility, impurities, customer specifications, freight and contractual arrangements.
Morocco is identified as a significant competitor, with the United States Geological Survey identifying Morocco and Western Sahara as having the world’s largest known phosphate reserves. OCP reports phosphate-rock production capacity of about 50 million tonnes per year and operates an integrated phosphate, phosphoric acid and fertiliser business.
Kirchner says Sandpiper would enter the market as a much smaller new supplier and that an updated economic assessment should provide evidence of potential customers, product qualification, offtake arrangements, expected price discounts or premiums and shipping costs.
The review also calls for the project’s fisheries assessment to be updated to reflect more recent information on Namibia’s small-pelagic resources.
Kirchner says the fisheries baseline in the ESIA relies heavily 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.
A 2025 Ministry of Fisheries and Marine Resources/Namibia Fisheries and Marine Resources Institute (NatMIRC) 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 inside the 200-metre depth contour and smaller groups farther offshore.
Kirchner says the survey does not demonstrate that Sandpiper dredging would damage the sardine stock, but represents important new information that should be incorporated into the project’s assessment.
She recommends a species-specific assessment examining the potential spatial overlap between mining and the recovering resource, sediment-plume exposure and possible food-web effects.
Kirchner’s overall conclusion is that it would be premature to either dismiss Sandpiper as uneconomic or regard its projected economic benefits as established.
She is calling on NMP to provide the land-based ESIA and Environmental Clearance Certificate, including quantified freshwater requirements and a defined supply solution.
An updated full-project feasibility and sensitivity analysis should also account for the expected realised selling price of 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 assessment should further demonstrate how the project would perform during prolonged periods of low phosphate prices.
Until this information is available, Kirchner concludes, the magnitude and durability of Sandpiper’s claimed economic benefits cannot be treated as established.
Sources consulted by Dr Carola Kirchner
Kirchner’s review draws on the 2022 Environmental and Social Impact Assessment (ESIA) for the proposed Sandpiper Marine Phosphate Project by Namibian Marine Phosphate, particularly sections dealing with land-based processing, freshwater requirements and permitting; the 2018 Standish/Stratecon report, Potential Economic Contribution of Namibian Phosphate Industry; the World Bank’s 2026 Commodity Price Data (The Pink Sheet); U.S. Geological Survey phosphate rock statistics and mineral commodity information; OCP Group’s 2026 investor and industrial operations information; and a 2025 horse mackerel and small pelagics survey report by the Ministry of Fisheries and Marine Resources and NatMIRC.
The sources consulted included:
Namibian Marine Phosphate (2022), ESIA Report for the Proposed Sandpiper Marine Phosphate Project within ML 170, Offshore Namibia, particularly pp. 52–72, 60–66, 121, 228 and 232–233.
Standish/Stratecon (2018), Potential Economic Contribution of Namibian Phosphate Industry, including the model appendix.
World Bank (2026), Commodity Price Data (The Pink Sheet), August 2026, and Historical Monthly Commodity Price Data, updated 4 August 2026.
U.S. Geological Survey (2026), Phosphate Rock Statistics and Information / Mineral Commodity Summaries.
OCP Group (2026), Investor Case and Industrial Operations information.
Kalola, M., Iita, K.T., Shoopala, E., Van der Plas, A., Endjambi, T. and Mwaala, L. (2025), Horse Mackerel & Small Pelagics Cruise Report 2025: Northern Benguela (17°15′–25°00′S), 11 March–06 April 2025, Ministry of Fisheries and Marine Resources, NatMIRC, Swakopmund, Namibia.
Photos: Namibian Marine Phosphate/ResearchGate
