MetalsGrove Mining Limited (ASX: MGA) acquired six lithium mining claims in Zimbabwe, a so-called “transformational opportunity” in a nation with Africa’s largest reserves of the battery metal.
On Monday, the Australian junior explorer announced that it had spent US$60,000 on the claims, which also contain significant quantities of tin and tantalum. The claims are comprised of two projects: Arcturas and Beatrice.
The Arcturas project was the most costly at US$50,000 and the remaining US$10,000 was used to acquire Beatrice.
The local claim vendors, La Rich Resources and the CN Mining Syndicate, will retain a 5 per cent free carried interest until a decision to mine has been reached.
They are situated adjacent to Zhejiang Huayou Cobalt’s (SHA: 603799) major Arcadia lithium mining operation, which produces approximately 450,000 tonnes of lithium concentrates per year.
“Importantly, the upfront acquisition terms are modest, allowing the company to set about rapidly advancing these projects through a targeted exploration campaign early next year,” said the company’s Managing Director, Sean Sivasamy.
He added that the company considers this acquisition to be a transformational opportunity. Shares of MetalsGrove shot up by about 16 per cent following the news.
Pegmatite outcrops at the Arcturas claims shown in neon green. Map via MetalsGrove
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MetalsGrove hopes open pit mining will become feasible
Pending positive exploration results, MetalsGrove believes the Arcturas and Beatrice projects have potential for future open pit mining. There are several pegmatite outcrops contained within the Arcturas claims, extending up to 1 kilometre on strike.
Aside from this African lithium exploration endeavour, the company focuses on a portfolio of rare earth, copper, gold, manganese and base metals projects in Australia.
Zimbabwe awarded mining licenses to a series of Chinese companies in Q3 this year valued at up to US$2.8 billion. The country’s lithium mining sector is seeing a lot of activity in particular recently.
Companies like Zhejiang Huayou Cobalt and the Sinomine Resource Group (SHE: 002738) established major lithium processing facilities in Zimbabwe this year. Within the past year, major Chinese mining firms have acquired lithium assets in the country valued at approximately US$500 million.
Last month, the Zimbabwe School of Mines held a Lithium & Battery Minerals Conference in the nation’s second largest city, Bulawayo. The event was aimed at networking among mining industry stakeholders and it featured a series of presentations on innovations in lithium production.
rowan@mugglehead.com
