Nigeria’s First Lithium Plant Gets Chinese Backing
Nigeria’s first lithium-processing plant has been making headlines this month, and it’s not just because of the massive investment behind it. The project, backed by three companies that seem to have a lot in common with China’s battery-metals industry, has raised eyebrows and sparked curiosity.
The trio of firms behind the planned $250-million investment – Ganfeng Lithium Industry, Tianqi Lithium Industrial, and Ningde Era Industrial – may sound familiar, but they are not the heavyweights listed on the Shenzhen and Hong Kong stock exchanges. In fact, these companies are wholly local ventures controlled by Chinese nationals, and they were founded just last year in a medium-sized southwestern Nigerian town.
Kelvin Dai, managing director of the Nigerian Ganfeng, clarified that they are independent companies and urged not to confuse them with their namesakes. However, the question remains – why did they choose such recognizable names?
This project is a response to the Nigerian government’s efforts to diversify the economy away from oil and tap into the predicted electric-vehicle sales boom. With lithium being a vital component in rechargeable batteries, it has become one of the world’s most important commodities.
The surge in demand for lithium has led to a frenzy of activity to secure fresh supplies, with new players like the recently established Nigerian companies and major automakers looking to cash in on the boom.
The Nigerian Ganfeng, owned by the Nigeria-based Tianqi and Ningde Era, hosted Solid Minerals Minister Dele Alake at a ceremony in the northern Nasarawa state to start building a facility that will refine 18,000 tons of lithium ore per day. Alake’s presence at the ceremony was to provide moral support for the project’s speedy completion.
The Nigerian firm released a statement to the local media, emphasizing that it is a renowned and reputable Chinese mining firm with no formal affiliation with its much larger namesake. However, it did not mention the names of its two shareholder firms.
It’s worth noting that the Nigeria-registered company is not a subsidiary of Jiangxi-based Ganfeng Lithium Group. Co. Ltd., Tianqi Lithium Corp., or Contemporary Amperex Technology Co. Ltd. This raises questions about the awareness of the Nigerian government regarding the similarity of the names between the investors and the Chinese giants.
Africa is forecast to increase lithium output more than 70-fold by 2030, with China leading the race to develop new sources of metal across the continent. Nigeria’s new facility aims to manufacture full EV batteries, making it the first factory of its kind in Africa. The company plans to make and sell lithium carbonate, a refined form of the metal used in EV batteries.
Nigeria has sizable untapped deposits of metals, including gold, zinc, lithium, and iron-ore. However, most extraction is done by artisanal miners on a small-scale or manual basis. The exception so far is Toronto-listed Thor Explorations, which commissioned the country’s first industrial gold mine in late 2021 and has also acquired licenses to explore for lithium.
The launch of Nigeria’s first lithium-processing plant is a significant step towards diversifying the country’s economy and tapping into the global demand for lithium. It’s an exciting development that could have a lasting impact on Nigeria’s position in the battery-metals industry.