AUSTRALIA Stock Exchange-listed mining group, Prospect Resources Limited, says it is considering potential commercialisation routes for its two lithium projects in Zimbabwe and Namibia.
The two ventures are the Step Aside project in Goromonzi district, Mashonaland East province and the Omaruru venture in Namibia.
In 2022, the exploration and development firm sold its Arcadia Lithium asset also in Goromonzi to a Chinese firm — Huayou Cobalt for around US$422 million.
Huayou is one of the world’s largest energy lithium-ion battery materials and new cobalt materials producer.
In its annual report for the year ended September 20, 2024, Prospect, whose focus is presently on developing the Mumbezhi Copper project in Zambia, said the above two lithium assets earmarked for a potential commercialisation are attractive.
This is based on strong assay results that have been produced as significant advances have been made on exploration at Step Aside and Omaruru.
“At every stage, these assets have indicated substantial additional mineralisation growth potential ready to be further uncovered. With our focus now directed towards the rapid advancement of the Mumbezhi project, we have reduced our exploration activities at Step Aside and Omaruru from the levels of the past 12-18 months.
“We are now considering potential commercialisation routes for these two attractive lithium assets and with Step Aside in particular, are actively testing market interest despite a subdued commodity price environment,” said Prospect.
In recent years, global meta prices except gold have remained subdued, ultimately impacting negatively on the production of strategic resources such as the Platinum Group Metals and lithium, not only in Zimbabwe, but worldwide.
For example, the World Platinum Investment Council has indicated that the platinum market recorded a deficit of 878 000 ounces last year. Total supply fell by two percent while demand spiked by 25 percent year-on-year, but this has failed to lift the prices.
In the lithium sector, international prices have plummeted from US$80 000 per tonne in 2022 to under US$15 000 presently and this has substantially been attributed to the glut of the base metal, and the rising interest rates have affected demand for electric vehicles. Prospect has announced that proceeds from the Step Aside venture will be used to develop the Mumbezhi Copper asset.
Presently, Phase 1 diamond drilling at the copper asset continues to produce wide and high-tenor intersections of significant copper mineralisation at the key Nyungu Central deposits.
Lithium is a strategically important base metal for Zimbabwe authorities expect would be critical in driving the growth and development of the mining industry, one of the country’s cornerstones of the economy.
According to the Zimbabwe Investment and Development Agency, the mining sector accounts for 760 percent of Foreign Direct Investment, 80 percent of exports — 19 percent of Government revenues, 3 percent of direct formal employment and 13,5 percent of national income.
The Government has set a US$40 billion target by 2030 for the mining sector and this comes as the industry recorded a US$20,5 billion in exports over the past five years.
Despite the mining industry’s significant contribution, the sector’s full potential was being constrained by a number of issues that include multiple taxes, high cost of electricity as well as beneficiation taxes and special gains tax.
Based on the above factors, among others, the Chamber of Mines of Zimbabwe in its Mining Industry Survey Report and Prospects for 2025, miners are pessimistic about the prospects for an optimal fiscal regime.