KoBold Metals Co., backed by Bill Gates and Jeff Bezos, has proposed to develop Congo’s substantial hard rock lithium deposit. This marks a pivotal investment proposal by a major US mining company. KoBold’s plan involves acquiring a mining license and resolving disputes linked to AVZ Minerals and Zijin Mining, amidst discussions for a minerals-for-security partnership between the US and Congo.
KoBold Metals Co., financially supported by renowned billionaires Bill Gates and Jeff Bezos, has expressed its intention to the government of the Democratic Republic of Congo to develop one of the largest hard rock lithium deposits globally. This proposal marks the inaugural major investment offer from a significant US mining company in Congo, coinciding with initial discussions about a potential minerals and security partnership between the two nations.
The proposal by KoBold involves acquiring a valuable mining license while addressing a prolonged dispute involving Australia’s AVZ Minerals Ltd., China’s Zijin Mining Group Co., and the Congolese government. The ongoing dispute has impeded investments in the Roche Dure resource, which holds promise to become a primary source for lithium, an essential material for battery production.
In a correspondence to Congolese President Felix Tshisekedi’s chief of staff, Sandy Alexander, KoBold’s Chief Legal Officer, articulated the potential of the deposit to evolve into a large-scale lithium mine. The company expressed enthusiasm for the opportunity to develop this significant asset. Currently, KoBold has over 70 exploration projects worldwide, including the development of the Mingomba copper mine in neighboring Zambia.
The timing of KoBold’s offer coincides with President Tshisekedi’s proposal for a minerals-for-security arrangement with the US administration amid ongoing instability in Congo’s eastern provinces, exacerbated by a Rwanda-backed rebellion. Concurrently, Zijin plans to inaugurate Congo’s inaugural lithium mine by early 2026, adjacent to the proposed area by KoBold.
Despite a significant decline in lithium prices by over 80% since a peak in 2022, Chinese firms are intensifying their production efforts across Africa to secure resources in anticipation of surging future demand. Earlier in 2023, AVZ was poised to commence the project when Congo canceled its rights and redistributed the permit, partially transferring it to Zijin. KoBold’s initiative aims to resolve ongoing arbitration cases, potentially revitalizing one of the richest untapped lithium sources globally.
To advance its proposal, KoBold indicated that AVZ would need to receive appropriate compensation and agree to relinquish all interests in Congo. Following the resolution of disputes, Zijin would retain the northern section of the deposit while KoBold would oversee the southern segment. Furthermore, KoBold has requested the Congolese government participate as a minority shareholder in any joint venture rather than reestablishing ties with Cominiere, AVZ’s prior partner.
The letter directed to Anthony Nkinzo, Tshisekedi’s chief of staff, also involved communication with AVZ’s Chief Executive Officer, Nigel Ferguson, and one of the company’s external legal representatives. Although KoBold declined to provide comments, they confirmed the dispatch of the letter. AVZ refrained from commenting, while Zijin and Nkinzo did not respond to inquiries seeking comments. Any potential acquisition by KoBold will need to navigate an existing agreement AVZ has with China’s Suzhou CATH Energy Technologies, which supports the Australian firm during ongoing arbitration proceedings.
Michael Bloomberg, owner of Bloomberg News’s parent company and an investor in Gates’ Breakthrough Energy, which holds a stake in KoBold, further ties the interests in this developing scenario.
In conclusion, KoBold Metals Co.’s recent proposal for lithium development in the Democratic Republic of Congo represents a significant investment from a prominent US mining company. As discussions regarding a minerals-for-security partnership unfold, KoBold’s initiative seeks to address existing disputes with AVZ Minerals and Zijin Mining. Their commitment to developing the Roche Dure resource underlines the growing importance of lithium in the context of energy transition and electric vehicle manufacturing, despite current market fluctuations.
Original Source: financialpost.com
