KoBold Metals Co., backed by Bill Gates and Jeff Bezos, has proposed to the Congolese government to develop a major lithium deposit amid discussions for U.S.-Congo minerals partnership. The initiative seeks to resolve disputes over mining licenses involving other companies and could unlock significant lithium resources essential for electric vehicle batteries, with implications for international mining relationships.
KoBold Metals Co., backed by billionaires Bill Gates and Jeff Bezos, has approached the Democratic Republic of Congo to express its intention to develop one of the largest hard rock lithium deposits globally. This announcement marks the first significant proposition from a US mining firm as the central African nation engages in preliminary discussions regarding a minerals and security partnership with the United States.
The company aims to acquire a valuable mining license while also addressing an ongoing dispute involving three parties: AVZ Minerals Ltd. from Australia, Zijin Mining Group Co. from China, and the Congolese government. This procurement conflict has hindered investments in the Roche Dure resource, which has the potential to emerge as a prominent source of battery metal.
In correspondence to President Felix Tshisekedi’s chief of staff, KoBold’s Chief Legal Officer, Sandy Alexander, stated that the deposit “has the potential to become a large-scale, long-lived lithium mine,” affirming the company’s desire to develop this asset. The company is also engaged in over 70 exploration projects worldwide, including the Mingomba copper mine in Zambia.
The proposal emerged shortly before President Tshisekedi recommended a minerals-for-security agreement to the administration of former US President Donald Trump. The Congolese government faces challenges in managing a rebellion in its mineral-rich eastern provinces, bolstering the urgency of these discussions.
Zijin plans to establish Congo’s first lithium mine by early 2026 in proximity to the area KoBold intends to develop. Despite a significant drop in lithium prices since 2022, Chinese firms are increasing their mining output across Africa. These ventures align with long-term projections for heightened demand.
AVZ Minerals was nearing the development stage of the project when the Congolese government revoked its rights in 2023, dividing the permit between AVZ and Zijin. KoBold’s proposal intends to resolve various arbitration issues stemming from this decision, which would unlock one of the richest unutilized lithium sources critical for electric vehicle batteries. The Australian company seeks to reclaim its full exploration license.
KoBold suggests that resolving disputes necessitates that AVZ receives “appropriate compensation” and agrees to relinquish its interests in Congo. Following resolution, the two parties would pursue development, with Zijin retaining the northern segment of the deposit and KoBold managing the southern area.
Additionally, KoBold proposed that the Congolese government holds a minority equity stake in any joint venture, rather than the state-owned Cominiere, which was AVZ’s former partner. Letter copies included messages for AVZ’s CEO, Nigel Ferguson, and an external lawyer.
KoBold has refrained from commenting but acknowledged the letter’s dispatch. AVZ did not provide comments, while Zijin and Chief of Staff Anthony Nkinzo did not respond to inquiries. Any acquisition by KoBold would also have to consider an existing partnership AVZ has formed with China’s Suzhou CATH Energy Technologies, which is co-backed by the leading EV battery manufacturer and assists in funding AVZ during arbitration.
In conclusion, KoBold Metals’ interest in developing Congo’s lithium resources signifies a pivotal shift in US mining investments and response to the growing importance of lithium for electric vehicle batteries. Their proposed acquisition and resolution of existing disputes present both opportunities and challenges as the Congolese government navigates international partnerships amidst ongoing local issues. Ultimately, the outcome of this development might shape the future of lithium mining in the region.
Original Source: financialpost.com
