Zimbabwe directs lithium miners to produce carbonates

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HARARE – The government has taken a significant step to boost the value of lithium exports by requiring lithium companies to create lithium carbonates rather than less valuable lithium concentrates, as part of its drive to promote mineral beneficiation in the mining sector.

Lithium mining companies are currently producing concentrates that the Finance Minister Mthuli Ncube has said would no longer be deemed beneficiation.

The new requirement is expected to come into effect in early 2024 with the minister directing lithium miners to submit their beneficiation plans and that no new licence will be issued without a beneficiation plan.

Presenting the 2024 National Budget on Thursday at the newly parliament building in Mt Hampden, Finance Minister Mthuli Ncube said that, “substantial mineral revenues can be generated from beneficiation of key minerals. With a significant resource endowment of Platinum Group of Metals, gold, lithium, and diamonds, economic transformation and development can be anchored on beneficiation.

“Within this context, any lithium value addition process that does not result in the production of lithium carbonate is not regarded as beneficiation, hence, is liable to an export tax. Lithium producing companies should submit their beneficiation plans no later than 31 March 2024. Furthermore, no licences shall be granted to a prospective lithium company without approval of a beneficiation plan.”

Some lithium companies, such as Kuvimba Mining House (KMH), which acquired the Sandawana Mine, have ambitious plans to invest US$600 million in the construction of a lithium carbonate beneficiation facility, which will result in the production of lithium ion batteries at its Sandawana Mine, and Bikita Mineral is also committed to value addition and beneficiation as the refinery is the next phase and feasibility studies are underway.

By requiring lithium companies to produce lithium carbonates, Zimbabwe can capture a larger share of the lithium industry’s profits while also creating more jobs for Zimbabweans. Lithium carbonate is a key ingredient in rechargeable batteries, which are used in a variety of electronic devices such as smartphones, laptops, and electric vehicles.

Existing lithium enterprises in Zimbabwe will need to improve their facilities to create lithium carbonates. New lithium firms seeking to operate in Zimbabwe must also generate lithium carbonates.

The Zimbabwean government hopes that the new criteria will encourage more investment in the lithium industry and help Zimbabwe become a significant player in the global lithium market.

Ncube also stated that the government will continue to support the mining sector in order to maintain sustainable growth of 7.6% in 2024, which will be driven by continuous investment in PGMs, gold, coal, and lithium, among other things.

 “In this regard, an amount of Z$132.7 billion has been allocated to the Ministry of Mines and Mining development to implement the legislative and administrative reforms that provides a conducive environment for mining and beneficiation,” he said

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