South Africa’s Moti Group has announced that its Chinese partner in the $1 billion lithium processing plant project in Zimbabwe is reducing its stake in the venture. The Chinese company, which has not been named, has slashed its stake from 20% to 10%.
The Moti Group’s subsidiary, Pulserate Investments, holds a 10,000-hectare lithium exploration concession in Zimbabwe’s northeast. The US Geological Survey has ranked Zimbabwe as Africa’s largest producer of lithium.
Earlier this year, Moti Group had announced plans to have the Chinese company increase its stake in Pulserate to 70%. The company also planned to seek an exemption from Zimbabwe’s ban on lithium ore exports and set up a battery factory.
However, the Chinese company has decided to reduce its stake in the project due to changes introduced by the Zimbabwean government regarding conditions for lithium mining and processing.
The Zimbabwean government announced a ban on lithium ore exports in December 2022. This has led to an increase in mining stockpiles of the valuable metal within the country, and an upsurge in illegal ore smuggling.
The reduced Chinese stake means that Moti Group will have to seek an alternative partner or secure the necessary funds themselves to proceed with building the lithium processing facility.
Zunaid Moti, the founder of Moti Group, is gradually stepping back from active management, and the company is undergoing restructuring efforts under the leadership of Dondo Mogajane, a former director general of South Africa’s National Treasury.
Mogajane, besides being the CEO of Moti Group, holds influential positions as chairman of South Africa’s Government Employees Pension Fund, which manages a substantial 2.3 trillion rand ($128 billion), and serves as a board member at the New Development Bank, a multilateral lender established by the BRICS group of nations.
The setback to the lithium processing plant project is a blow to Zimbabwe’s plans to develop an industry for processing lithium, which plays a pivotal role in the battery storage and electric vehicle sectors.
