China, Zimbabwe partner on lithium mining
Zhejiang Huayou Cobalt Co. and Tsingshan Holding Group Co. are pushing forward with plans to develop a lithium deposit in Zimbabwe, despite the global lithium market facing a significant price slump.
Partnering with Zimbabwean state-owned Kuvimba Mining House, the two Chinese companies are working on the Sandawana lithium project in southern Zimbabwe. This venture, which was first announced by Kuvimba in July, will involve constructing a mine and processing plant with an investment ranging between $250 million and $300 million, expected to yield 500,000 tons of lithium concentrate annually.
Strategy
The companies are in the process of finalizing a comprehensive feasibility study, with completion expected in the next three months. While lithium spot prices have plunged nearly 90% since their peak in 2022, Huayou and Tsingshan remain committed to securing raw materials for their domestic refineries. This move reflects a broader strategy by Chinese companies to maintain a foothold in lithium supply chains, regardless of price volatility.
Trevor Barnard, Kuvimba’s acting CEO, expressed optimism that the plant will be profitable even at current price levels, with a projected strong recovery in lithium prices from 2026 to 2027. The project marks significant Chinese investment in Zimbabwe’s emerging lithium sector, which is poised to contribute around 10% of global lithium supply this year.
In addition to this venture, Huayou has already invested over $700 million in Zimbabwe’s Arcadia mine, while Tsingshan is developing a smaller lithium project in Gwanda. This collaboration will not involve direct ownership of Sandawana; instead, Huayou and Tsingshan will operate the mine for at least five years, after which the asset will revert to Kuvimba, following repayment of the project’s financing. The terms of the offtake agreement with the Chinese companies are still under negotiation.
Kuvimba also has two additional exploration-stage projects at Sandawana, and is in discussions with potential investors, including British entrepreneur Algy Cluff. The Sandawana site, historically known for emerald mining under Rio Tinto Plc, has seen a shift in focus towards lithium and other valuable minerals like iron ore and tantalum in recent years.
