Mozambique graphite extraction projects have come to the front of a US attempt to control critical minerals for the clean energy transition, many of which are now mainly produced in China.
Mozambique was one of five African countries invited to the United States convened Minerals Security Partnership (MSP) which US Secretary of State Antony Blinken opened on 22 September in New York on the margins of the United Nations General Assembly High-Level Week.
Blinken in particular cited the graphite mine in Balama, Mozambique. “Graphite from this mine will soon be sent for further processing to a plant in Louisiana, where it will create more jobs and where it will provide graphite used for batteries by American electric vehicle companies.”
The US Department of Energy (DoE) in an 18 April statement said “today the United States is 100% reliant on imported graphite as China produces nearly all of the high-purity graphite needed to make lithium-ion batteries.”
The DoE is providing $107 mn loan to the Australian owners of Balama, Syrah Resources, to build a processing factory in Vidalia, Louisiana, to produce graphite-based anodes for lithium-ion batteries. The DoE said the plant would create “98 good-paying, highly skilled operations jobs within the clean energy sector.”
According to the Mozambique News Reports and Clippings newsletter, the African country “gets nothing but a hole in the ground, while the manufacturing is in the US. For a critical mineral such as graphite, which the US wants from a non-Chinese source, Mozambique could have demanded that the processing be in Cabo Delgado. But it did not”.
The newsletter underlines that on the same day Blinken spoke, workers at the Balama graphite mine were on strike, as were 100 workers at the nearby Ancuabe graphite mine, demanding wage increases. Work at both mines was halted. Miners claim they are being paid less than the mining minimum wage of USD 162 per month.
At Balama, Local workers first went on strike on 7 September, calling for wage parity with employees brought in from elsewhere, and for benefits such as health insurance. The newsletter adds that “there are warnings that as more people are displaced by the new graphite mines, this could fuel the insurgency, as happened with people evicted from the ruby mines and gas project”.
As Bloomberg recently reported that China is cutting back on lending to Africa, meaning that developing countries in Africa are losing a “champion that for years allowed them to borrow at cheaper rates than they could find in capital markets”, the newsletter adds that “China has been particularly important because it lends for long term infrastructure projects such as the Maputo ring road, that could not be funded elsewhere, and funding was without the conditions imposed by the IMF and World Bank”.