China's Huayou buys lithium mine in Zimbabwe for $422 mln (updated)

Prospect Resources

22/12/2021 16:29

* Huayou to buy Arcadia mine owner Prospect Lithium Zimbabwe
    * Cobalt giant has been stepping up investments in lithium

 (Updates throughout)
    HARARE, Dec 22 (Reuters) - China's Zhejiang Huayou Cobalt
 603799.SS  said on Wednesday it would pay a total $422 million
to acquire the Arcadia hard-rock lithium mine in Zimbabwe.
    The move marks Huayou's second foray into lithium, a key
ingredient in rechargeable batteries, in the space of a week. It
is the latest acquisition of overseas battery mineral resources
by Chinese companies looking to shore up supply to meet demand
from the burgeoning electric vehicle (EV) sector. 
    Huayou, the world's biggest producer of cobalt, another
battery metal, in 2020, said in a filing it would pay $388.8
million for Australia-listed Prospect Resources Ltd's  PSC.AX 
87% stake in Arcadia owner Prospect Lithium Zimbabwe.
    It will pay another $44.2 million for the 6% stake held by
Zimbabwean professor Kingston Kajese and the 7% held by Tamari
Trust, which previous Prospect filings show is linked to Paul
Chimbodza, executive director of Prospect Lithium Zimbabwe.
    The Arcadia project aims to process 2.4 million tonnes of
ore per year but has not yet reached commercial production.
Prospect Resources said in July the first batch of petalite from
pilot production had been delivered to offtake partner Sinomine
and that it was also working on spodumene samples. 
    Spodumene and petalite are lithium-bearing minerals.
    Zimbabwe is desperate to attract investors into its mining
sector, which it says will drive the recovery of its stricken
economy. It has opened its doors to Chinese firms, which now
operate several chrome, coal and gold mines.
    Huayou's Executive Vice-chairman George Fang told Reuters in
September that the company was seeking to invest in lithium
mining and processing, including in Africa.  urn:newsml:reuters.com:*:nL4N2QV308
    Last Friday, Sichuan New Energy Power Co Ltd  000155.SZ 
said it agreed a lithium production and battery recycling tie-up
with Huayou in China.  urn:newsml:reuters.com:*:nL4N2T23D1 

 (Writing by MacDonald Dzirutwe and Tom Daly; editing by Jason
Neely and David Evans)
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