JCHX’s plans had almost collapsed after cash-rich Abu Dhabi upstart International Resources Holding (IRH) was poised to follow suit after announcing its interest in the same assets earlier this year. IRH is a unit of the United Arab Emirates’ most valuable company, the International Holding Company.
Since then, however, the sources said IRH backed out, leaving JCHX with a clear path to close the deal in the coming weeks.
As the energy transition unfolds, China and the Middle East have loomed large in a race to tap Africa’s reserves of critical raw materials needed to transition away from fossil fuels as oil powers begin to emulate the years China’s investment.
“We are pleased to say that the transaction as announced is on track and we expect it to close in the coming weeks,” said Jason Chang, chief executive officer of EMR. Reuters.
“Some elements of the process are out of our control.”
JCHX is finalizing the details of the purchase with Zambian authorities, having reached an agreement with EMR, one of the sources said.
EMR, which has owned the Lubambe mine since 2017, wants to exit the project as its capital matures after Covid-19 delayed its development, Reuters reported in March. EMR also sold its entire stake in the adjacent Mingomba copper project for a significant, undisclosed sum to California-based startup KoBold Metals.
IRH, boosted after buying a 51% stake in Zambia’s Mopani Copper Mines, said it is looking for more opportunities to expand into critical metals in Zambia and on the continent.
Zambia, Africa’s second-largest copper producer, will own a 30 percent stake in Lubambe’s assets through state-owned company ZCCM-IH, said Hapenga Kabeta, Permanent Secretary at the mines ministry. Reuters.
ZCCM’s board approved the purchase of the Lubambe mine from JCHX, Kabeta said.
ZCCM, which has most of its assets in mining and energy and invests on behalf of the government, declined to comment.
JCHX did not immediately respond to emailed questions. Lubambe, formerly owned by African Rainbow Minerals and Vale SA, produced about 15,000 tonnes of copper last year but needs to increase production to about 2,500 tonnes a month to become sustainable, it says on its website.
China is aggressively pursuing copper, cobalt and lithium deals in Africa as the world’s second-largest economy continues to scour the globe for natural resources needed for its fast-growing electric vehicle industry.
MMG, backed by state-owned China Minmetals NonFerrous Co, bought Botswana’s Khoemacau copper mine for about $1.9 billion.
Chinese investors are the biggest mining investors in Zambia’s northern neighbor, the Democratic Republic of Congo, which is also the world’s No. 1 cobalt producer.
(By Felix Njini, Melanie Burton and Julian Luk; Editing by Veronica Brown and Michael Perry)