Premier completes  US$75m Zulu lithium plant

Oliver Kazunga-Senior Business Reporter

Premier African Minerals has completed the development of its Zulu lithium project near Bulawayo for US$75 million, further elevating the country’s position as a major producer globally.

The project, which is situated in Insiza District, Matabeleland South Province has of late been undergoing plant modification and the mining group remains confident that the conditioning tank would be the last plant adjustment for the mine.

In February this year, Premier,  a United Kingdom-headquartered firm that also owns mining claims for rare earth elements and tungsten in Zimbabwe, announced the intention to raise £2,4 million (about US$3,15 million) to fund the Zulu project.

In the latest update, the group said conditioning tank delivery and commissioning remain on track for completion during the week commencing on July 10, 2024.

Group chief executive officer Mr George Roach said: “Premier sincerely hopes the conditioning tank will be the last plant modification and on that note, the board remains confident regarding the prospects for Zulu.

“And we note that at this time the development of Zulu, a complete mine, has cost the company the better part of US$75 million, and neither this nor the deemed valuation of Zulu agreed with our take-off partner is reflected in our current market capitalisation.”

Last month, Premier announced the successful production of saleable spodumene concentrates from the floatation circuit at Zulu with a constant improvement in grade.

At the time, the miner targeted production at 50 tonnes of spodumene concentrate per day with an anticipated increase in output.

The company maintains a target full projected capacity of 4 000 tonnes per month.

Spodumene is a lithium ore crucial for battery production in electric vehicles and features a high lithium concentration.

“The sale of concentrates on hand is now expected to proceed on an ex-mine gate basis.”

Meanwhile, the Southern African country has seen massive investments in developing lithium assets over the last few years amid the growing global demand for the precious metal.

The exponential global demand for lithium is being driven by the rising production of electric vehicles – and other electronics – seen as essential for energy transition based on zero carbon emission. 

Notably, most of the investments in Zimbabwe’s lithium sector have come from large-scale miners.

The country currently has more than seven lithium exploration and mining projects in the country, which are at different development stages, with Chinese companies leading the charge.

These include the Arcadia Lithium project near Harare, with an estimated investment of US$477 million, Bikita Minerals’ only global petalite operation being further developed into a 300 000 tonne per annum spodumene operation, Chengxin Lithium Group’s Sabi Star 3000 tonnes per annum project in Buhera, Zulu Lithium’s US$34 million spodumene project near Bulawayo and Bravura’s multi-million dollar operation under development in Kamativi.

Processing plants for lithium projects are also being developed across the country including in Shamva, Kadoma, Chegutu, Goromonzi and Mberengwa, among others.

This makes lithium one of the key prospects for Zimbabwe’s mining industry, which the Government intends to grow to a US$12 billion sector, from US$2,7 billion in 2017.

Zimbabwe earned US$209 million from lithium exports in the first nine months of last year, from US$1,8 million in 2018 and US$70 million in 2022. It is expected to soon become the country’s third largest mineral export after gold and platinum.

Lithium is also a strategically important mineral for Zimbabwe the Government expects would be significant in driving the growth and development of the mining industry, one of the cornerstones of the country’s economy.

The Government has set a new US$40 billion target by 2030 for the mining industry. Zimbabwe has generated over US$20,5 billion from exports over the past five years.

Official figures indicate that the mining industry continues to be a significant contributor to employment, currently creating more than 53 000 formal jobs and over 500 000 artisanal and small-scale miners.

The Chamber of Mines of Zimbabwe anticipates that capacity utilisation in the mining industry will this year reach an average of 90 percent sustained by gold, ferrochrome and coal.

Capacity utilisation in the mining industry last year averaged 84 percent from 81 percent in 2022.

In the outlook for 2024, mineral output is expected to grow by a weighted average of around 7,6 percent as mining companies ramp up production to compensate for revenue losses arising from low commodity prices.

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