Published On: Wed, Aug 1st, 2018

Chinese Stitch Up Deal For World’s Largest Lithium Deposit

Two of the most powerful Chinese businessmen in Africa have emerged as the driving force behind the development of a potentially vast new lithium deposit.

Min Guo Wei and Cong Mao Huai have been linked to a company that is overseeing the development of the Manono lithium field in the Democratic Republic of Congo (DRC). Manono has been called “the world’s largest undrilled lithium resource” and may contain more than 1 billion tonnes of lithium-bearing ore.

Chinese flag, Beijing, China. 2009 Photo/Daderot

According to a report by Business Insider, Min Guo Wei was the first director of Dathomir Mining Resources, which was awarded the license to develop Manono by the DRC government in 2016. At the time, Min Guo Wei was also the executive director of Sicomines, a $6 billion joint venture between China and the DRC to swap minerals for infrastructure.

He was succeeded at Dathomir by Cong Mao Huai, who has been described by Africa Intelligence as the “godfather” of Chinese mining in the DRC. He is reported to be close to the DRC government and is the key man in arranging Chinese mining deals in the country.

“It is apparent from public records that the project is being directed behind the scenes by Chinese businessmen who are close to the DRC government,” Business Insider said.

The involvement of powerful Chinese interests in the Manono project comes as China is seeking to increase its control over the lithium market.

Demand for lithium is expected to increase by about 74% over the next four years, driven by increasing use of batteries to power electric vehicles, smartphones and other electronic devices.

China already controls about 50% of global production having recently acquired a stake in Chile’s SQM for $4.1bn. The country is now targeting Africa’s relatively undeveloped lithium deposits as its battery manufacturers look to dominate the market.

The Manono deposit is potentially the most exciting undeveloped asset in the world but little is known about Dathomir Mining Resources, the company awarded the exploration license in 2016. Business Insider reported that Dathomir was controlled by a Seychelles entity that was founded by Edmond Lecourt, a controversial financier based in Monaco.

In January 2017, Dathomir sold a 60% stake in the Manono project to a small Australian company called AVZ Minerals. AVZ was at the time run by Klaus Eckhof, who had previously worked with Cong Mao Huai at Panex Resources.

In return, Dathomir took a stake of 13.9% in the Australian miner. Since then, AVZ’s links to China have grown with Huayou Cobalt taking a 10.4% stake and supply agreements have been struck with Guangzhou Tinci Materials and Beijing National Battery Technology.

AVZ Minerals might now be the public face of the Manono venture but it appears that Chinese interests are still pulling the strings.

Author: James North

On the DISPATCH: Headlines  Local  Opinion

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