Huati Lighting Technology plans to improve its positioning in the new energy supply chain by buying a controlling stake in a lithium mining firm in Mozambique for USD3 million.
A unit of Huati Lighting will acquire 85 percent of Kyushu Resources, which was set up in August and owns exploration right No. 11,682 in the Gilé district of Mozambique’s Zambezia province, its Chengdu-based parent company announced.
The prospecting right covers an area in the northeastern part of the Alto Ligonha pegmatite belt, where there are many large and super-large rare metal deposits, Huati Lighting pointed out.
Huati Lighting will start sinking mines and extracting lithium ores by itself or with a professional third party, it noted. The company will ship the processed lithium concentrates through the port of Nacala, around 350 kilometers away, to Shanghai for sale to clients in China, it added.
The project’s likely fixed-asset investment and working capital will be up to USD10 million, Huati Lighting noted, citing the latest report by an industry consultant.
Presuming no significant changes in lithium carbonate prices, the project will likely gross USD103.6 million of annual revenue, with a profit of USD45.6 million after it reaches full capacity, according to the company.