Mining ZimbabweLatest Mining News, Policy and Industry Updates

Premier African Minerals, a London-listed company, has raised £1.25 million for its Zulu lithium and tantalum project in Zimbabwe.

Patricia Rwafa

The funds will be used for ongoing mining operations and working capital. The company is also addressing technical challenges in its processing plant.

Premier raised £1,25m at 0.16p per share to fund the optimisation of the Zulu plant which has been dogged by delays and questions about the grade of its offtake.

Premier in March replaced the original contractor at the Zulu plant and says that, while the flotation circuit is now capable of running in a constant and stable state, it will take time to fully remedy the original design deficiencies in the overall plant and move from what, in many instances, are interim fixes to the final operating.

Contractors at Zulu have agreed to accept payment of 2 million dollars of invoices, in new ordinary shares of the company.

Accordingly, the company on 21 May settled a payment of US $2milion (equivalent to £1.57 million)in invoices through the issue of 983,500,000 new ordinary shares of the company at the price of 0.16 pence per order share. 

The company is optimistic about the mining operations and ore grades expecting quarterly production reports starting from Q3 2024 and is actively resolving technical challenges in its floatation circuit and ore sorting processes.

According to George Roach, CEO,

 “The Company provided a full discussion on the Zulu plant performance in our announcement of 8 May 2024. 

The Company expects that periodic updates will be provided on the overall plant performance until a steady state of continuance production has been achieved, Premier expects thereafter to begin providing quarterly production reports for Zulu from Q3 of 2024.

Over and above this, we are encouraged with mining operations and the ROM ore grades that consistently exceed our resource estimate and this is mitigating for the moment, the ore sorter deficiencies.

This also supports the review of overall operations and production costs and the likely reduced production costs discussed below. 

Inspections required as a prelude to export have commenced, and this precedes any export. We do not expect any delays regarding the export permits required. 

This was confirmed in recent meetings with the Government of Zimbabwe when the issue of RHA Tungsten Private Limited (“RHA”) was also discussed and we are encouraged that there is now a likely resolution to this issue. The rising price of Tungsten is noted“.

The government of Zimbabwe, through the Ministry of Mines and Mining Development, has extended the submission deadline for beneficiation plans from lithium producers by two months. This decision comes after receiving only four proposals from large-scale lithium miners, according to Deputy Minister of Mines and Mining Development, Engineer Polite Kambamura.

The initial deadline for the submission of beneficiation plans was March 31, but miners requested more time from the Ministry to consult their head offices abroad and to incorporate beneficiation into their annual budgets.

This extension underscores the government’s commitment to transforming the local lithium industry from merely producing lithium concentrate to generating battery-grade lithium, which has a significantly higher value.

Eng Polite Kambamura stated, “There is no going back; the government has said lithium producers should bring their plans for beneficiation. They need to produce lithium salts, such as lithium carbonate and lithium hydroxide, which are better products for battery manufacturing in the country. We need to be prepared. We are not only going to end with concentrated lithium carbonates, but we also want batteries to be manufactured here so that Zimbabwe will be the hub.”

He added, “Yes, they are coming forward with the plans, but these are mostly long-term plans.”

Currently, four large-scale lithium producers have submitted their beneficiation plans.

“We are yet to sit down to consider their proposals. It’s still work in progress. We extended the period by another two months,” Dr. Kambamura noted.

Zimbabwe hosts over ten large-scale lithium mining companies, including the Arcadia Lithium Mine, which is owned by Prospect Lithium Zimbabwe. Arcadia boasts the largest hard rock lithium processing plant in Africa and the second largest globally for lithium concentrates.

Other notable lithium mines include Sabi Star Lithium Mine owned by Max Mind Investments, Bikita Minerals owned by Sinomine, Sandawana Mines owned by Kuvimba Mining House (KMH), Gwanda Lithium Company, Mutoko Lithium Mine, and Kamativi Lithium Mine owned by Kamativi Mining Company (KMC).

The directive for lithium beneficiation is part of a broader strategy to boost government revenue and ensure that the country benefits more significantly from its vast mineral resources. Finance Minister Professor Mthuli Ncube has mandated that lithium companies submit beneficiation plans before receiving operating licenses. With numerous lithium mining projects underway, Zimbabwe, which holds the largest lithium reserves in Africa, is poised to become a key player in the global lithium market.

However, there are challenges. One significant impediment to the establishment of battery-grade lithium processing plants is the fluctuating price of lithium. Moreover, companies like Zhejiang Huayou Cobalt have expressed concerns about the local conditions for producing battery-grade lithium. Huayou pointed out that Zimbabwe lacks the necessary resources such as reliable renewable energy, natural gas, and sulphuric acid, which are critical for the production process.

Zimbabwe’s substantial hard-rock lithium reserves have attracted over $1 billion in investments from Chinese companies, including Zhejiang Huayou Cobalt, Sinomine Resource Group, Chengxin Lithium Group, Yahua Group, and Canmax Technologies. Despite this influx of investment, the establishment of local beneficiation plants remains a complex issue.

Last year, the value of lithium exports reached US$878.44 million, a figure that helped offset the decline in gold and PGM (platinum group metals) revenue, according to Zimstat data. In the first quarter of this year, lithium exports were valued at US$76.3 million. These figures highlight the potential economic benefits of developing a robust lithium beneficiation industry in Zimbabwe.

The government has long struggled to persuade PGM miners to refine their metals locally. These miners typically ship concentrates to South African refineries, citing insufficient local electricity and mineral supplies to support the significant capital investment required for building refineries. This situation has prompted a renewed focus on ensuring that the lithium sector does not follow a similar path.

As the government pushes for the beneficiation of lithium, the success of this initiative will depend on addressing the infrastructural and economic challenges that currently hinder the production of battery-grade lithium. The ongoing engagement with mining companies and the extension of the submission deadline are steps towards achieving this goal and positioning Zimbabwe as a central hub in the global lithium market.

The Chamber of Mines of Zimbabwe has announced its upcoming annual mining conference and AGM program with a comprehensive agenda designed to cover all critical issues for the mining industry.

Set to take place from May 28th to May 30th, 2024, and themed “Unlocking Growth Potential for the Zimbabwe Mining Industry,” the event aims to foster a sustainable growth environment that aligns with Zimbabwe’s Vision 2030.

President of the Chamber of Mines, Thomas Gono, highlighted the conference’s significance: “As is our tradition, we invite you to an update on our upcoming annual mining conference and AGM. The theme is driven by the desire to create an environment that sustains growth and achieves the economic transformation we all aspire to.”

The program includes a critical minerals symposium, a PGMs Indaba, the main conference, exhibitions, and various side events such as dinners, cocktails, and a golf tournament.

Isaac Kwesu, CEO of the Chamber of Mines, provided a detailed overview of the four-day event: “On the first day, which is the 28th of May, we will have our traditional constitutional meetings, the annual general meeting, and council meetings. These meetings address our internal governance issues in the mining industry.”

Day two will feature two key symposiums. The Critical Minerals Symposium will explore the global production and markets of critical minerals, particularly those driving clean energy.

“Critical minerals have become a major driving force in clean energy, and Zimbabwe is endowed with many of these minerals. We found it desirable to host this symposium to discuss critical issues, such as policy matters, operational matters, and markets,” said Kwesu.

Honourable Minister Chitando will be the guest of honour, with a keynote speaker from SFA Oxford providing insights into global critical mineral markets.

In the afternoon, the focus will shift to the Platinum Group Metals (PGMs) Symposium. Given the global developments in the PGM industry, particularly with depressed commodity markets, this session promises to be crucial.

“PGMs constitute the largest chunk of Zimbabwe’s export earnings. Delegates and other critical stakeholders are keen to learn about the future of the platinum markets and how Zimbabwe can navigate the current challenges,” Kwesu noted.

The symposium will feature contributions from current operators, new investors, and industry experts from South Africa.

The main conference, or Indaba, on May 30th, will be officially opened by His Excellency Dr. E.D. Mnangagwa. Senior government officials, including the Minister of Finance, the Minister of Mines, the ZIMRA Commissioner General, and representatives from the energy sector and financial markets, will discuss the industry’s growth imperatives and how it can harness capital from financial markets.

“Senior government officials and industry leaders will cover various aspects of the mining industry, providing updates from mineral sub-sectors such as gold, PGMs, and ferrochrome,” Kwesu added.

The event will conclude on May 31st with a networking day, featuring activities such as golf and other events at Victoria Falls, offering ample opportunities for informal engagement among delegates.

With a comprehensive agenda designed to cover all critical issues for the mining industry, the upcoming conference is set to drive significant advancements and foster collaboration across the sector.

For more information and to register for the conference, visit the [Chamber of Mines of Zimbabwe’s website].

The Chamber of Mines of Zimbabwe anticipates a significant increase in gold production driven by rising gold prices and the strengthening of the Zimbabwe Gold (ZiG) currency.

by Rudairo Mapuranga

This positive outlook was shared by the Chamber’s CEO, Isaac Kwesu, who highlighted the dual benefits of attractive prices and improved viability for mining operations.

“Naturally, most mines will increase output because, apart from being attractive, viability issues will be addressed. Mines that may not have been operating due to viability challenges will see higher prices as an opportunity to come back to life,” said Kwesu.

Kwesu further explained that the sector expects increased production from current mining operations and the initiation of new projects, along with fresh investments in gold entities.

“We expect increased production from current entities through their current operations. Additionally, new projects and investors with an appetite for gold entities will support gold output. This presents a positive outlook for our gold sector,” he added.

Positive Impact on the Zimbabwe Investment Group (ZiG)

The surge in gold production is set to benefit the newly introduced Zimbabwe Gold (ZiG) currency, designed to stabilize the nation’s economy.

Kwesu elaborated on the mechanism, noting that the increase in gold production will directly boost the gold reserves, which underpin the ZiG currency.

“As you know, the gold reserve is an offshoot of the royalty paid by gold producers. Half of this royalty is paid in kind. Therefore, as gold output increases, the royalty automatically increases, as it is a function of total production. Half of that royalty will be paid in physical gold, thus increasing the gold reserve to support the ZiG, naturally leading to an increase,” Kwesu stated.

Growth in Gold Deliveries

Recent data underscores the upward trend in gold production. Deliveries by large-scale gold miners rose by approximately 11.78 percent, reaching 1,168.7022 kilograms in March, up from 1,045.5575 kilograms the previous month.

Large-scale miners accounted for 51.995 per cent (3,143.0683 kilograms) of the total deliveries in the first quarter of 2024, surpassing Artisanal and Small-Scale Mining (ASM) contributions of 48.004 per cent (2,901.8006 kilograms). Historically, ASM has been the primary gold deliverer to Fidelity Gold Refinery (FGR), contributing over 61 per cent of total gold deliveries.

Strategic Introduction of the ZiG Currency

The introduction of the ZiG currency in April marks a strategic move by the government to stabilize the economy. The central bank governor, John Mushayavanhu, assured that the ZiG would be set at a market-determined exchange rate and backed by gold reserves to avoid the hyperinflation that has plagued previous currencies. The government aims to ensure that the local currency in circulation is matched by an equivalent value in precious minerals or foreign exchange.

This robust approach, combined with increased gold production and responsible sourcing, aims to create a stable and valued currency, driving Zimbabwe towards economic recovery and growth. Zimbabwe’s mining sector is thus making significant strides in ramping up gold production, a critical measure aimed at bolstering the newly introduced ZiG currency.

Backed by gold reserves, the ZiG currency represents the government’s latest effort to stabilize an economy that has faced inflation and currency devaluation for the past 25 years. The combined efforts of the mining sector and monetary policies are set to pave the way for a more stable and prosperous economic future for Zimbabwe.