Credit to Africa intelligence:
Extract of article 25-3-19.
Faced with the wave of Chinese demand, local officials and particularly the future governor are well-placed to become key partners of the Chinese mining groups, whether for the negotiation of permits with land-owners, support for applications at the mines ministry or the provision of security on mining permits for operators. For the time being, the authorities are limiting themselves to playing the justices of the peace among the Chinese industrial groups who are trying to get in on existing permits. These are controlled by smart Western juniors who acquired permits even though they are incapable themselves of financing their development.
Giant AVZ permit much sought after
The biggest and richest permit, which belongs to Australian junior AVZ Minerals, is attracting particular interest. Over the last year, all the big names in the Chinese lithium sector have been making strenuous efforts to charm their way into the project. Beijing National Battery Technology Co, Shanghai Greatpower Industry Co and Guangzhou Tinci Materials Technology Co have tried to position themselves alongside AVZ by signing agreements to take ore produced by the Australian group in Manono (read Africa Mining Intelligence 25/09/18).
Two other giants, Huayou Cobalt and Contemporary Amperex Technology Co (CATL), have used different tactics to get into AVZ's capital and so obtain rights in the so-called Manono Project. Huayou invested $10 million to buy AVZ shares in 2017 and increased its shareholding to 9.49% in March this year. It was long rumoured that CATL would do the same. In the end though, it was the little-known Australian company, Lithium Plus, which invested $3 million in AVZ in February 2019. Lithium Plus has links, however, with CATL since one of its managers, Chinese businessman Bin Guo, is on the board of Canadian company North American Lithium (NAL), which is a subsidiary of the Chinese group.
Companies which have failed to establish themselves on the giant AVZ permit are targeting all other available concessions in Manono. Hong Kong fund Ruiha Investment has been investing since 2017 in Canadian company Tantalex Resources Corp, which is carrying out the Buckell Project (read Africa Mining Intelligence 09/10/18). For its part, Lvchi Automotive Technology (Shanghai) Co, an engineering company development technology for electric vehicles, has formed a strategic partnership with Australia's Hipo Resources, which is present on the Kamola site.
So far, however, only one Chinese operator has succeeded in obtaining direct rights on lithium permits. He is the "godfather" of the Chinese mining community in Congo-K, Cong Mao Huai, often nicknamed Simon Cong. A fluent French speaker, Cong has been established in Congo-K for more than 20 years and is particularly close to Zoe Kabila (African Mining Intelligence 25/09/18). One of his companies, Dathomir Mining Resources, has acquired a 10% stake in the Manono permit operated by AVZ, and another of his companies, MCC Resources, owns several concessions in the area.
Faced with this concerted offensive by the Chinese groups, Western operators are struggling to stay in the race. Australia's Force Commodities and India's Mining Mineral Resources (MMR) have set up a joint venture on the Kanuka mining site (Africa Mining Intelligence 24/07/18). But the most determined operator is mysterious Mauritius-registered company MMCS Strategic 1, which is striving to take over AVZ's star Manono permit. MMCS, which is thought to be partly controlled by Victor Hanna, former Africa director at the Kazakh Eurasian Resources Group (ERG, Africa Mining Intelligence 18/07/17), claims that it owns the AVZ concession. It took legal action against the mining junior in Australia before starting arbitration proceedings against the site's original owner, Congolese national mining company Cominiere, claiming that it had signed an agreement with the company which gave it the mining rights at the site. The case, which is being heard by the International Chamber of Commerce in Paris, got under way in February (Africa Mining Intelligence 05/03/19). |
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