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Farirai Machivenyika Senior Reporter
Zhejiang Huayou Cobalt of China has bought the controlling interest in Zimbabwe’s Arcadia Lithium Mine located in Goromonzi District from Prospect Resources of Australia for US$377,8 million and will be accelerating development of the mine and downstream processing of lithium products in Zimbabwe before export.
Prospect Resources sold its 87 percent stake in Prospect Lithium Zimbabwe to Zhejiang Huayou Cobalt which is listed on the Shanghai Stock Exchange.
Zhejiang is a big company, with a market value of US$22 billion and it will be spending US$422 million if it buys out minority shareholders to assume full ownership.
The old and new owners signed the agreements at State House witnessed by President Mnangagwa.
He said the Chinese company brings with it the benefit of significant operational experience, with a focus on research, production of cathode materials, development and production of battery precursor, development of battery metals resources, safety, environmental management, and development and operation of mining projects in general.
“The commitment by Zhejiang Huayou Cobalt to rapidly advance operations at Arcadia is a welcome development.
“This agreement therefore capacitates Prospect Resources to accelerate their activities in Zimbabwe over the coming years.
“This partnership is further envisaged to result in the development of a broad portfolio of high quality battery metals projects. In addition, such a pathway brings significant foreign direct investment (FDI), broadens employment opportunities as well as royalty and tax revenue for our country,” the President said.
The coming of Zhejian was a vote of confidence in Zimbabwe’s investment climate and economy as a whole.
“It also reaffirms the success of our mantra, ‘Zimbabwe is Open for Business’ and will leap frog our country into lithium production and value chain industries,” said President Mnangagwa as he presided over the signing ceremony.
Lithium is becoming an increasingly important mineral.
Besides forming the base of modern battery technology, it has retained its traditional uses in glass and ceramics.
Demand will continue to increase sharply as the world switches from vehicles using internal combustion engines to electric vehicles, all of which will require the most advanced battery packs, at the moment those containing lithium ions.
Lithium is expected to contribute US$500 million towards Government’s target of a US$12 billion mining industry by 2023.
The President said, as a country with one of the largest lithium reserves in Africa, Zimbabwe was poised to become a hub for research, development, exploitation and manufacturing of green energy and lithium based solutions.
Zimbabwe has vast mineral deposits and the President said Government would continuously work on improving the investment policies in the sector to ensure its growth.
“In keeping with the tenets of ease of doing business, the Ministry of Mines and Mining Development and other Government Ministries, Departments and Agencies are directed to support this and other initiatives towards increased investments into our economy,” he added.
In his remarks, Prospect Lithium Zimbabwe executive director Mr Paul Chimbodza said considerable work had already been done. Around US$20 million had been sunk in the exploration works that included the drilling of 314 drill holes totaling 26 680m, 6 000 samples analysed from drill core and chips, plus another 15 204 soil samples.
Arcadia Lithium ore reserves were now calculated 42,3 million tonnes with a 20-year lifespan and hosts spodumene and petalite resources which offer feedstock to both battery and ceramics industry.
A pilot plant has already been constructed and is producing on-spec petalite product for export.
“This journey of Arcadia and these glowing accolades, would not have been possible without the immense guidance, support and enabling environment accorded to us by Government and the new dispensation,” Mr Chimbodza said.
Mr George Feng the executive director of Zhejiang Huayou Cobalt said his company was committed to developing green projects that benefited communities.
He said the mineral resource at Arcadia Lithium project was world class and thanked the Government for creating an enabling environment for investors.
He pledged that full operations at the mine would commence in a few months’ time once all regulatory requirements have been completed.
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