Harare – Australian-listed Prospect Resources says it is in on-going discussions with a number of entities including African development banks and institutions, and a European family office consortium regarding the possible project financing of its flagship Arcadia Lithium project located on the outskirts of Harare.
The company also operates Sally Gold Mine and Prestwood Gold Mine, located in Gwanda.
Its cash balance as at 31 March 2019 stood at $2.97 million.
In a market update, the company said the discussions are at various stages of maturity and contemplate a variety of structures from traditional debt and equity financing through to 100% debt financing.
“The Company has received a draft commitment letter from a potential debt arranger/financier to provide project finance funding for Arcadia,” the company said.
“However, at this stage, the Company believes the proposal is incomplete and requires further development and clarification before the Company can continue to progress discussions on that draft document.”
The Arcadia project is expected to have a yearly plant throughput of 1.2 million tonnes, and a lifespan of 20 years.
It is considered to be one of the world’s biggest hard rock lithium resources, providing Prospect with a globally unique position to be the only lithium producer that will produce both spodumene and petalite.
Zimbabwe is already Africa’s largest lithium producer and fifth largest in the world with reserves estimated around 23 000 tonnes.
The growth in electric vehicles production which is expected to increase significantly over the next few years is expected to push lithium demand to even greater heights.
Equity Axis News
Raynold Mhotseka is a Journalism and Media Studies student at the University of Zimbabwe. He serves as a news writer at financial research firm, Equity Axis where he is currently on attachment. He can be contacted through the following email links, email@example.com and firstname.lastname@example.org.