Sinomine bought into Bikita last year in a US$180 million deal with African Metals Management Services and German investor Wilfried Pabst’s Southern African Metals and Minerals, the Mauritius-registered companies that held a combined 74% of the mine.
Bikita had been exporting since the 1950s.
After the acquisition, Sinomine immediately started building a processing plant, under a US$200 million investment that will treble production.
That new spodumene processing plant will be completed in June. Revenue almost doubled last year due to increased output, says Finance Manager Amanda Makausi.
“When Sinomine took over in February 2022, we were producing plus or minus 2 500 tonnes per month and our prices were around US$500 per tonne,” said Makausi.
“Pre-COVID, we were doing approximately US$25 million annual revenue, but in 2022 we recorded our sales of US$47 million. In 2023 we are projecting around US$750 million depending on the commissioning of the new plants. From 2024, we will be looking at US$1 billion annual revenue,” said Makausi.
The company says it has also trebled its tax contributions to an average US$150 000 per month since the takeover.
Lithium prices are falling on the world markets on expectations of a slowdown in demand, wiping out the gains of a two-year bull run.
This may slow down investment in Zimbabwe’s lithium assets, which peaked in 2022 with a string of lithium deals. However, Sinomine would be hoping that its projected lithium grade of 5-5.5% will offset the impact of current low prices.
To secure power supplies, Bikita has started construction of a 113km 132-kilovolt power line from the existing Tugwi substation to the planned Bikita Minerals substation. The mine will install substation ancillary services, protection equipment, metering equipment, power network control and telecommunication system.
As part of the agreement, Bikita will ensure that the new substation also supplies power beyond the mine, to other areas such as Gonye, Nyika, Chivaka and the Bikita local load.
Bikita will recoup its investment by offsetting charges for future power use, a deal similar to another grid agreement between ZETDC and Tsingshan, which is building a steel plant near Chivhu.
The company expects to employ over 1 000 permanent workers after the completion of the new plants, up from the 360 workers that it had before the acquisition. Currently, including construction workers, the mine has 1 800 staff on site.- NewZWire