Modern Mining March 2022

LITHIUM

Prospect Resources eyes new opportunities Following the sale of Prospect Resources’ flagship Arcadia Lithium project, located on the outskirts of Harare in Zimbabwe, to Chinese firm Zhejiang Huayou Cobalt, the company is actively investigating new energy metals opportunities. By Nelendhre Moodley .

Prospect Resources MD Sam Hosack.

L ate last year, Prospect Resources announced the proposed sale of its 87% interest in the Arcadia Lithium project to energy lithium-ion battery material producer Zhejiang Huayou Cobalt (Huayou), for around $378-million. To date, Prospect Resources has funded all explo- ration and development activities at Arcadia but took the decision to identify potential partners to fund the next stage to construction completion. Huayou Cobalt is a new energy lithium-ion battery material

consisting of a series of stacked mineralised pegma- tites which extend for over 3 km of strike length. According to Hosack, the project represents one of the best untapped lithium

projects globally, with an optimised definitive feasi- bility study already completed. It is estimated that the project will produce an average of 147 000 tonnes per annum (tpa) of spodumene and 118 000 tpa of petalite concentrates during its 18-year life of mine. In a bid to illustrate project viability, last year Prospect Resources completed construction, com- missioning and commenced production on the Arcadia pilot plant. “With the support of Zimbabwe’s government, Prospect has developed a world-class lithium project that, under the guidance of a leading global player in Huayou Cobalt, will be developed into one of the world’s best lithium mines,” says Hosack. It is expected the transaction will be completed in late Q1 or early Q2 2022. “With Huayou set to become the custodians of Arcadia, the project and Zimbabwe stand to benefit from its capability and balance sheet strength,” he adds. Seeking new battery and electrification metals opportunities Even as Prospect Resources is in the process of selling its interest in the Arcadia lithium project, the African-focused exploration and development com- pany is already scoping out new opportunities in Zimbabwe and sub-Saharan African countries. “As we complete the Arcadia transaction and build on our existing experience and portfolio of battery and electrification metal projects, we would love to take advantage of the favourable governance to do it all over again in Zimbabwe, should the right opportunity present itself,” says Hosack. Having experienced sig- nificant support from the Zimbabwean government in the development of the Arcadia project, he lauds it for ‘walking the talk’ in ensuring the country is “open for business”. “As we progressed the project towards a finance and production ready phase, the Government of Zimbabwe supported our endeavours in several

producer with three major business segments: research, development and production of cathode materials; research, development and production of battery precursor, and development of battery metals resources. “Having received a number of com- petitive offers we concluded that the Huayou transaction delivered the most attractive risk-adjusted, post-tax value outcome for Prospect shareholders through-the-cycle,” says Prospect

The Huayou transaction delivered the most attractive risk- adjusted, post-tax value outcome for Prospect shareholders through- the-cycle – Hosack.

Resources MD Sam Hosack. In 2016, Prospect Resources acquired the Arcadia hard rock lithium project and undertook extensive metallurgical test work to upgrade Arcadia’s ore body, which contains petalite (containing 4% lithium oxide) and spodumene (containing 6% lithium oxide). Arcadia is a high-grade, large-tonnage deposit

Prospect Resources’ Arcadia Lithium project, located on the outskirts of Harare in Zimbabwe.

12  MODERN MINING  March 2022