Huayou, the Chinese chemicals and minerals firm, says it expects to create 1 000 new job opportunities for local Zimbabweans during the construction and development phase of the new Arcadia lithium project.
The announcement came after the Tongxiang-based company acquired the project from several Prospect Resources Plc shareholders in April 2022. It would invest $300 million into the lithium mine and processing facilities over the next year, said Huayou.
Lithium demand has skyrocketed with the increased appetite for electric vehicles (EVs) worldwide. The volatile metal is crucial to the manufacturing process of the lithium-ion batteries used to power EVs.
Despite the immense strain on supply chains during the Covid-19 pandemic, EV sales grew by 50% in 2020 and then doubled in 2021. This accounts for around seven million units leaving showroom floors.
The ”hockey stick” growth experienced by the EV industry has naturally increased the price of lithium, with prices soaring roughly 550% in a year, as per an April 2022 report put out by McKinsey.
Lithium-carbonate equivalent (LCE), prices in March 2022 peaked at $75 000 per metric ton, while lithium hydroxide, commonly used for industrial applications, peaked at $65 000 per metric ton.
According to the same report, the demand for lithium will grow from 500 000 tons of LCE to between three and four million by the decade’s end.
This is promising news for Zimbabwe’s Arcadia project as the Goromonzi mine, 38 kilometres east of Harare, is expected to process about four and a half million tonnes of lithium ore every year. Huayou says that once processed, the mine will produce about 300 000 tonnes of LCE per annum.
The Arcadia project dovetails well with Zimbabwean president, Emmerson Mnangagwa, mantra of “Zimbabwe is open for business”. Lithium mining is fundamental to Mnangagwa’s goal of a $12 billion mining sector by next year.
Zimbabwe is already a notable producer of lithium ore, ranking fifth globally. Interestingly, just one mine, Bikita Minerals, is responsible for Zimbabwe’s lofty position.
The addition of a 400 000 ton LCE per year facility would substantially improve the sub-Saharan African nation’s already prominent status as a lithium hub.
Lithium mining is a very messy practice, contributing significantly to global emissions. However, Huayou said the Arcadia lithium project would be developed with environmental wellbeing in mind, particularly when it came to emissions.
Around 600 local Zimbabweans would be employed in the construction phase and another 700 to 900 for the production phases, said a statement issued by the firm. The Chinese company will give special priority to residents in the Goromonzi region, focusing on nurturing skills through training.
The company’s corporate social responsibility committee will focus on addressing the needs of the local community in areas like employment, health, food, water and education.
A local school, Vhuta, located near the Acardia site, has already received some investment from Huayou, according to the Zimbabwe Herald.