Chinese miners Zhejiang Huayou Cobalt and Tsingshan Holding Group are set to create a lithium mine in Zimbabwe with a state company despite the low prices of the battery metal.
Bloomberg quoted the acting chief executive of Kuvimba Mining, Trevor Barnard, as saying that the two Chinese companies, which already operate lithium projects in the country, are expected to conclude a study before building a mine and processing plant at Sandawana.
The State-owned firm owns the asset.
Huayou and Tsingshan’s construction plans would cost between $ 250 million and $ 300 million, producing about 500,000 tonnes per year of lithium concentrate.
The companies are said to be conducting a more thorough feasibility study, which is expected to be finalised within the next three months.
Zimbabwe has become a substantial producer of lithium in the past two years and is expected to contribute approximately 10% of the global mined supply this year, according to the CRU Group.
Barnard said that Huayou and Tsingshan have committed to returning the asset to Kuvimba after a minimum of five years and recouping the loan that would fund the project, rather than owning shares in Sandawana.
Rio Tinto operated a mothballed emerald mine at Sandawana for several decades in the previous century.
Kuvimba, which has partitioned Sandawana into three blocks, is currently in discussions with potential investors regarding two additional earlier-stage projects that necessitate further exploration.
The investors include a firm owned by British businessman Algy Cluff, who played a significant role in the development of the North Sea oil and gas industry and has overseen mining projects in African countries like Zimbabwe.
Chinese enterprises continue to seek feedstock to supply refineries domestically, even though lithium spot prices have plummeted by about 90% since late 2022, resulting in occasional production shutdowns and deferrals worldwide.
Mathew Nyaungwa, Editor in Chief, Rough&Polished
