Mining ZimbabweLatest Mining News, Policy and Industry Updates

Zimbabwe has been pushing for value addition and beneficiation of the country’s minerals, with much focus on lithium as the country gears up to advance the green revolution agenda and achieve an upper-middle-income economy by 2030.

Beneficiation is a crucial part of Zimbabwe’s economic diversification, and the establishment of lithium processing hubs, particularly lithium battery manufacturing companies, could immensely benefit the country.

The lithium beneficiation venture is closely linked to the drive for the country’s reindustrialization. Reports indicate that the country’s manufacturing capacity utilization has declined by over 34 per cent, with the government committed to reviving the manufacturing industry through the introduction of Special Economic Zones (SEZ).

The softening of lithium commodity prices will likely affect the implementation of beneficiation plans, as companies may face revenue challenges for expanding mining projects.

Can Zimbabwe benefit from the clean energy revolution?

The local think tank Zimbabwe Coalition on Debt and Development (ZIMCODD), in its weekly communique, highlighted Africa’s struggle with trade injustice, hindering its ability to develop industries while continuing to export raw minerals to the Global West.

“Lithium will become one of the most in-demand minerals in the coming years due to its importance in clean energy and information technology. The country must create a conducive environment through government policy and practice to encourage and sustain investment.

“Zimbabwe needs to centralize the processing of raw minerals to produce higher-quality products, creating jobs and boosting local economies,” stated ZIMCODD.

Economist and trade expert Doubt Chiorora believes Zimbabwe stands to benefit significantly from the ongoing lithium rush but emphasizes the need to enhance the regulatory framework to attract investors interested in adding value to the resource locally.

“With proper investment and support, Zimbabwe has the potential to become a major player in the lithium industry. However, lithium beneficiation may face challenges such as limited infrastructure and technical expertise. The government should focus on creating favourable regulatory and environmental conditions,” said Chiorora.

Is Zimbabwe ready to produce battery-grade lithium?

The government wants lithium miners in the country to aim to produce battery-grade lithium locally and is considering imposing taxes on lithium concentrate exports in the future.

Although currently Zimbabwe is allowing companies to export lithium concentrates, the government seeks to move beyond concentrate production, often shipped for further processing outside the country, mainly to China.

Establishing a converter/plant for battery-grade lithium requires green or renewable power, natural gas, food-grade carbon dioxide, first-class sodium carbonate, and other supporting materials, which are in short supply in Zimbabwe and Africa at large. The Sandawana lithium project aims to produce battery-grade lithium, either as lithium sulfate or lithium carbonates, by 2030.

According to Kuvimba’s Head of Energy Cluster, Trevor Barnard, KHM prioritizes the development of the Sandawana lithium project and aims to make the mine fully operational by the first quarter of 2025. The subsequent stages include establishing a lithium sulfate plant and eventually a lithium carbonate processing plant, with the process expected to take three to four years from the date of full operations.

Prospect Lithium Zimbabwe (PLZ), according to Paul Chimbodza, is studying the feasibility of producing battery-grade lithium.

“Feasibility work has begun to explore value addition, either through lithium carbonates or lithium sulfate. With these battery-grade lithium products readily available in Zimbabwe, it may be easier to attract battery manufacturers to set up operations locally,” said Chimbodza.

Is battery manufacturing possible?

There is significant potential for Zimbabwe to establish value-addition and beneficiation facilities, such as a lithium-ion battery manufacturing industry, which would create jobs and increase the value of the country’s lithium exports.

Max Mind Investment and its partners are preparing to construct an industrial park to host lithium battery manufacturing plants.

Zhejiang Huayou Cobalt’s Prospect Lithium Zimbabwe intends to manufacture lithium batteries in Zimbabwe as part of its efforts to contribute towards the government’s vision of achieving an upper-middle-income economy by 2030.

PLZ’s director in the general manager’s office, Mr. Yu Long, stated that they will explore manufacturing lithium batteries in Zimbabwe after completing the process to produce battery-grade lithium.

“As PLZ, we will follow the procedure step by step. Firstly, we need to complete the concentrate, then move on to producing lithium sulfate and continue further to manufacturing batteries,” Long explained.

Conclusion

While it appears that Zimbabwe is poised to produce battery-grade lithium, investment readiness remains a concern, particularly with the softening of commodity prices. Prospects in the mining sector suggest that the country may not be fully prepared to produce battery-grade lithium in the next two years.

The Minister of State and Devolution for Masvingo Province, Honorable Ezra Chadzamira, has expressed appreciation for the role Bikita Minerals is playing in enhancing the mining, agriculture, and construction industries through the construction of a power line that will cover four districts in Masvingo Province.

Rudairo Mapuranga

In addition to introducing a 132kV transmission line for Bikita Minerals, the project also includes a 132kV transmission line for Masvingo City.

Speaking during a ministerial visit to assess the project before its commissioning by President His Excellency Dr. Emmerson Mnangagwa, the Masvingo Provincial Minister stated that the project will benefit the province in terms of its contribution to achieving the upper middle-income economy status.

“Thank you very much for this flagship project; it is going to benefit Masvingo, Gutu, Zaka, and Bikita districts. It will also benefit key economic sectors, namely the agriculture, mining, and infrastructure sectors. It is our province’s duty to contribute to the national GDP as we aim to achieve the upper middle-income economy status. This project will mark a significant milestone,” Hon. Chadzamira said.

This vital project carries a cost of USD 22 million, with USD 2 million allocated for rural electrification.

Regarding employment, the 132kV project employed 500 locals during its construction. Furthermore, families and farmers affected by the power line construction were duly compensated.

Private sector investment can help address the country’s infrastructure deficit, and development should be private sector-led, as outlined in the National Development Strategy 1.

After uncovering the Mukuyu gasfield in Zimbabwe’s Cabora Bassa basin, Invictus Energy anticipates more finds in the region. With rising energy demands locally and globally, the company is poised to capitalize on opportunities.

The basin was previously explored by oil and gas corporation Mobil Oil in the 1990s, however, no drilling was conducted, says Invictus Energy MD Scott Macmillan.

Based on the two-dimensional seismic data Mobile provided, Invictus, using modern technology, identified the Mukuyu gas prospect, as well as other targets, thereby enabling Invictus to refine its initial target area for its first drilling campaign, which was conducted in 2021/22.

Invictus has since confirmed two discoveries off the back of a second drilling campaign conducted late last year and has identified further prospects in the basin, which the company is aiming to explore, in addition to further appraisal of Mukuyu to prove a larger resource and reserves base from Mukuyu.

Prior to drilling, Invictus deployed new generation wireless node technology for its infill seismic surveys to provide better definition over the Mukuyu structure and refine the drilling location for the first well. The node receivers are quicker to deploy, and provide higher quality and data density, while having a lower environmental footprint.

The survey was conducted in partnership with seismic company Polaris Natural Resources, which has undertaken over 1 000 seismic projects and introduced the first ‘low impact seismic crew’ into Africa in 2008, Macmillan explains.

Zimbabwe’s energy demand is steadily increasing and has not been met by new supply, which has curtailed economic growth as it impacts on industrialisation.

Currently, a significant proportion of the power generated in Zimbabwe is from hydroelectric plants, which can be affected by low rainfall and, thus, limit the power produced, says Macmillan.

He asserts that natural gas can play a significant part in Zimbabwe’s future energy mix by allowing for the development of a reliable, consistent and affordable baseload power generating system.

Following an agreement with the Sovereign Wealth Fund of Zimbabwe, in August 2022, Invictus was able to increase the licence area of the Cabora Bassa basin project from about 101 171 ha to 360 000 ha.

Commercialisation
Having declared dual discoveries in December 2023, Invictus set about detailed testing and analysis of multiple gas condensate samples successfully retrieved to the surface from Mukuyu.

“Initial results received in early March 2024 indicate a very high quality gas, with negligible impurities, which means natural gas extracted from the reservoir will require minimal processing,” Macmillan says.

He notes that Zimbabwe – a landlocked country – has presented some challenges when evaluating commercialisation options.

“Gas can be difficult to monetise because it requires pipeline infrastructure to transport it to the end-user.”

In this regard, the Southern African Power Pool (SAPP) – an agreement between 12 Southern African Development Community countries through their respective electric power utilities to facilitate crossborder electricity trading – presents an opportunity for Invictus to explore gas-to-power options, the products of which can be exported to SAPP offtakers without the need to build significant pipeline infrastructure.

“Our project is located less than 100 km away from three major interconnectors into the SAPP . . . [enabling us] to monetise large-scale gas into the electricity network and then export that over a wide region.”

Discussing short-term commercialisation options, Macmillan says Invictus has started liaising with potential customers. The company is also working towards monetising early pilot-stage production, which it hopes to start in the next 12 to 18 months, following initial well testing.

The pilot-stage production aims to demonstrate an early-stage market for gas and generate revenue before the full field development starts.

Challenges
As a junior explorer, Invictus’ primary challenge is securing funding, Macmillan says, elaborating that the oil and gas exploration industry is quite capital-intensive and high-risk – challenges that have been compounded by the project being in a frontier basin.

However, he enthuses that the company has been fortunate to have the full support of its shareholders throughout the project thus far, as well as in the post-discovery phase of development. Invictus can now evaluate alternative forms of financing.

MiningWeekly

Prospect Resources Limited (ASX: PSC) has announced the execution of an agreement with Osino Resources Corp. (OSI.TSXV) (Osino) to acquire Osino’s residual 60% interest in Richwing Exploration (Pty) Ltd (Richwing), which holds a 100% ownership of the Omaruru Lithium Project (Omaruru) in Namibia.

Patricia Rwafa

Consolidation facilitated by the recently announced gold-focused combination transaction between Osino Resources and Yantai Gold. Phase 2 drilling at Omaruru is progressing well, with all assay results expected to be available by late April.

The agreed consideration for the purchase is a nominal US$75,000 cash. Upon completion, Prospect will hold a 100% interest in Richwing (and thus Omaruru). Key conditions precedent to completion are administrative and not material to completion.

The agreement for Prospect to purchase Osino’s residual interest in Omaruru has been precipitated by the recently announced combination transaction between Osino and Yantai Gold, which is focused on Osino’s flagship Twin Hills Gold Project in Namibia.

In an update released on 30 August 2023, the program also includes further targeting of the root zone feeder system identified on the southeast flank of Karlsbrunn Main, which previously returned 35m @ 0.85% Li2O from the surface.

The results from the Phase 2 program are expected to further define the geometry, depth, and strike extent of key lithium-mineralized pegmatites. The outcomes are also expected to inform the generation of a more detailed and deeper RC drilling program, which is targeted at a potential JORC-reportable lithium Mineral Resource estimate during 2024.

In addition, on 15 November 2023, Prospect was currently undertaking the Phase 2 exploration program at Omaruru (approx. 4,250m of RAB and RC drilling). This program has been designed to target prospective geochemical anomalies at Karlsbrunn SE, Karlsbrunn NE, and Bergers Central, identified in field programs conducted through CY2023.

According to Sam Hosack, Prospect’s Managing Director and CEO, “We are delighted to have opportunistically acquired the residual interest in Omaruru at such an attractive purchase price.

This transaction has been predominantly driven by the recently announced combination deal between Osino and Yantai for the Twin Hills Gold Project, with the bidder focused on the acquisition of a clean gold asset.

We look forward to completing this transaction and moving to 100% ownership of Omaruru, at the same time as we continue to advance our rigorous exploration and evaluation activities at the Project.

Owning the asset 100% frees us up from the earn-in joint venture and we can pace exploration to suit our needs,” he said.

In response to a downturn in commodity prices, Zimplats, the country’s largest platinum group metal (PGM) producer, has initiated voluntary retrenchment measures to minimize the impact of spending cuts on its growth strategy, including the US$1.8 billion expansion program.

According to a statement by Head of Corporate Affairs, Mrs. Busi Chindove, Zimplats aims to ensure the integrity of its production capacity and infrastructure, while maintaining social and environmental responsibility and compliance.

“We also seek to minimize the impact of spending cuts on our growth strategy, which includes a US$1.8 billion expansion program. The program comprises various stages of execution, with targeted interventions including operational efficiency improvements, operating cost realization, capital prioritization, and labour cost optimization.

“Our immediate focus is on cost reduction, improved productivity, and ensuring safe, consistent, and sustainable volumes.

“Our past successes, notably in 2008 and 2014, are testament to the flexibility and resilience of our workforce. We must leverage the hard work and investments made in the recent past to secure a better future for the company and its stakeholders,” she said.

Chindove also emphasized the importance of ensuring that those who lose their jobs do so voluntarily and have sustainable post-employment prospects. Zimplats recognizes that securing the business to sustain jobs is critical. She stated that employees are instrumental in creating value, but due to persistently low PGM prices, restructuring to ensure business sustainability is imperative.

“Cash interventions must align with prevailing metal prices and deliver the strategic objective of achieving positive cash flow.

“Regrettably, labour optimization initiatives must be implemented urgently to secure the business and preserve the majority of jobs within the company. The latest offer for voluntary retrenchment is part of that response.

“We will ensure that the process is advanced with due care and sensitivity,” Mrs Chindove concluded.