Huayou Cobalt is pushing ahead with the construction of a concentrator plant at Arcadia mine, and says it has averted a potential processing dispute with a regulator.
The company bought Arcadia Mine in December for US$422 million and is racing to meet its target to start production in 2023. But the company faced risks of delays after the Competition and Tariff Commission in June ordered the company commit to producing battery-grade lithium within five years.
The company plans to build only the concentrator plant to process lithium ore, but says a converter to produce battery-grade lithium is not in the company’s plans. Huayou says it has held talks with CTC and agreed to continue with its original plans.
“Battery-grade lithium production is not part of the Arcadia Lithium Project Agreement, but we have had discussions with the Zimbabwe Competition and Tariff Commission. Both parties agreed to explore the viability of developing locally produced lithium sulphate only when the construction and economic conditions are right,” Huayou says.
newZWire has reached out to the CTC for comment on this and will update once a response is received.
Resource-rich economies are keen to limit the export of unrefined minerals. Some in lithium producing countries such as Zimbabwe want miners to make batteries, or at least battery-grade lithium, but producers like Huayou prefer to make batteries near their customers, and say the lack of other inputs makes local production unprofitable.
Huayou in May said there was a chronic shortage of the materials needed to produce battery-grade lithium in Africa, and importing these materials would be unaffordable.
The company adds: “Huayou Cobalt is committed to collaborating with local stakeholders to explore the development of infrastructure that would allow refining to happen close to production. But we are not in position to do this without the support of local partners and without the right conditions in place.”