Zimbabwe’s lithium riches attract fresh $300 million from investors, some of whom may be from China

Mutapa Energy CEO Innocent Rukweza announced that the finance deal had been concluded.

“It’s a done deal,” Innocent Rukweza, chief executive officer of Mutapa Energy, said in an interview.

While he refused to identify the investors, he did say the money came from a group that included Chinese corporations.

According to him, one of the collaborating enterprises is publicly traded and must first comply with regulatory disclosure requirements before its participation can be publicized, as seen on Bloomberg.

Zimbabwe has emerged as one of the world’s main exporters of lithium ore, owing mostly to considerable Chinese investment.

According to data from the United States Geological Survey, the country supplied raw materials to China’s leading electric car battery sector, accounting for around 10% of worldwide mined lithium output in 2018.

Previous reports revealed that Chinese mining behemoths Zhejiang Huayou Cobalt and Tsingshan Holding Group were in talks with Mutapa Energy on a deal worth between $250 million and $300 million.

The planned partnership focuses on expanding the Sandawana lithium deposit with additional mining and processing facilities. Both businesses already have lithium projects in Zimbabwe.

Sinomine Resource Group, Chengxin Lithium Group, and Sichuan Yahua Industrial Group are among Chinese enterprises that have invested in Zimbabwe’s lithium sector.

The investment comes as Zimbabwe seeks to retain more value from its mineral endowment through more local processing.

Earlier this month, the United States Department of Defense announced intentions to initiate a strategic lithium stockpile and to purchase around 36 million pounds (16,000 tonnes) of battery-grade lithium carbonate over the next five years under a $300 million contract.

This led to projections that Zimbabwe is in the perfect position to tap into this fund.

The idea is comparable to resource strategies implemented by numerous African countries, notably Guinea, Ghana, and the Democratic Republic of the Congo, which are attempting to treat more of their resources before export.

Rukweza stated that Mutapa had already mined around 2 million tonnes of ore from the Sandawana deposit.

The business is presently building a processing plant with the potential to handle up to 3 million tonnes of ore per year, considerably enhancing Zimbabwe’s ability to process lithium locally rather than exporting raw materials.