Lithium developer Prospect Resources pivots to another battery mineral – copper

File: Workers in Zambia's Mufulira load copper onto trucks (Per-Anders Pettersson/Getty)

Prospect Resources says it is to acquire a copper operation in Zambia, expanding its battery minerals assets in Southern Africa at a time lithium prices are falling.

The company explored and sold the Arcadia Lithium Mine in Zimbabwe to Huayou Cobalt in 2022, receiving US$378 million for its stake. It has since used proceeds of that sale to explore a new lithium site, Step Aside in Goromonzi, and bought the Omaruru operation in Namibia. It is now seeing to get into copper for the first time, spreading its reach to other battery minerals as lithium remain under pressure.

Prospect says it will acquire Mumbezhi operation from its current owners, Global Development Cooperation Consulting, for US$5.5 million in cash and US$1 million in Prospect scrip. Mumbezhi is in Zambia’s Copperbelt.

Lithium prices collapsed by up to 80% last year, due to rising supplies of the battery metal, and weak demand from Chinese and American electric vehicle (EV) markets. This has slowed down investment in new lithium mines, including in Zimbabwe. However, companies are pivoting from metals used in the batter itself – such as lithium, nickel and graphite – to other metals in the chain, such as copper. The price of copper has risen to its highest levels in over a year.

“The timing of this push into copper is ideal as markets for lithium remain subdued,” says Prospect MD Sam Hosack. “Our current drilling program at Step Aside is nearing completion and the acquisition of 100% of Omaruru gives us much more flexibility with cash spend, allowing a real focus on aggressively drilling Mumbezhi.”

Hosack believes the “long term potential of lithium remains robust but we are excited to add copper to our portfolio as it provides diversification and this new project holds the potential to rapidly develop into the flagship project we have been seeking.”

ALSO READ | After Huayou deal, lithium explorer Prospect looks for a new win