Nonetheless, lithium costs have fallen sharply from their 2022 peak as a wave of recent provide has overwhelmed weaker than anticipated demand for electrical car batteries.
The value stoop “is making it tough for lithium corporations to remain afloat, with most mining entities downscaling manufacturing” and shedding staff, Sinomine unit Bikita Minerals instructed visiting lawmakers, in response to a presentation seen by Reuters on Tuesday.
“The lithium mines proceed to function in an setting with dangers which embody fragile energy provide, capital constraints and international forex shortfalls,” the corporate mentioned.
There was additionally lack of “clear and constant insurance policies on licensing, taxation and export laws”, it mentioned.
Bikita Minerals added that Zimbabwe’s international forex regulation requiring exporters to commerce 25% of their arduous forex earnings for a quickly weakening native unit known as the ZiG was leading to lack of worth.
“Lack of primary infrastructure, reminiscent of roads, transportation, energy and water provide in lithium-rich areas is hindering exploration and extraction of lithium reserves, considerably influencing manufacturing prices,” it mentioned.
The federal government may assist lithium miners by introducing tax breaks and decrease royalties, the corporate mentioned.
Each the mines and finance ministries weren’t instantly out there to remark.
Zimbabwe, which has had a chronic financial disaster triggered by the seizure of white-owned farms to resettle landless blacks since 2000, is hoping international demand for lithium will assist increase its struggling financial system.
Regardless of the plunge in lithium costs, the federal government is urgent miners, who at present ship concentrates to China, to construct refineries within the nation.
Sinomine, which has invested $300 million in Bikita Minerals after buying it in 2022, has mentioned it plans to spend as much as $500 million constructing a lithium smelter on the mine over the following 5 years.
(By Nelson Banya; Modifying by Emelia Sithole-Matarise)