Sovereign Metals (ASX:SVM) - US-Aligned Strategy Reshapes $750M Kasiya Funding Plan

Interview with Sapan Ghai, CCO of Sovereign Metals Ltd.

Recording date: 8th October 2026

Sovereign Metals Limited is developing the Kasiya project in Malawi, which the company describes as the world’s largest rutile deposit. Kasiya also contains a large graphite co-product and a heavy rare earth concentrate identified during recent test work. Chief Commercial Officer Sapan Ghai outlined how the project’s commercial and funding strategy has changed over the past year.

The most significant change is the role of the US government. Ghai said the US State Department and other agencies approached Sovereign roughly nine months ago. Their focus was on how Kasiya’s minerals could be processed in Malawi into products suitable for US aerospace, defence and industrial end uses. Ghai has since briefed policy makers, including the White House Council of Economic Advisers. He described the Washington engagement as covering offtakes, funding and knowledge sharing. His position is that if the US wants Kasiya’s minerals, it should help finance the build.

The second change is Rio Tinto’s step back. Rio Tinto invested roughly A$60 million and built its stake to just under 20%, but has declined to take on operatorship. Ghai attributes this entirely to Rio Tinto’s new strategy, which concentrates on copper, aluminium, iron ore and lithium. He stressed that no technical red flags were raised. The DFS was completed with Rio Tinto’s input, and Ghai expects outcomes within plus or minus 5% to 10% of its estimates. Former Rio Tinto staff have joined Sovereign, and the company’s build team has constructed around a dozen mines in Africa.

On offtakes, most rutile is expected to go to Japan for titanium metal production. That route connects Kasiya to an established supply chain serving US aerospace and defence primes. Ghai said a leading Japanese titanium producer has confirmed the rutile can be used for all end purposes. Around 70% of Kasiya’s graphite is refractory grade, used in electric arc furnaces. Sovereign holds a non-binding marketing arrangement with Traxys North America for US sales. Traxys participates in Project Vault, the US critical minerals stockpile initiative. Rare earth offtake discussions are at an early stage.

The funding plan is the central investment question. Ghai’s working assumption is peak funding of about $750 million. Around $450 million would come from DFIs such as the IFC, DFC and AFC, and about $300 million from equity and offtake-linked finance. The comp