File image for illustration purposes
Prospect Resources is putting two lithium prospects in Zimbabwe and another in Namibia on the shelf to focus on its new copper project in Zambia.
The company, listed on the Australian Stock Exchange, hit the jackpot two years ago when it spent US$25.7 million on exploration at the Arcadia lithium mine in Goromonzi, before selling its 87% stake to Huayou, the world’s number one cobalt producer, at a premium price of US$378 million.
The company had hoped to repeat the feat with new exploration projects near Goromonzi, Bikita and at Namibia’s Omaruru.
However, investor interest in lithium has since waned due to lower metal prices. Unsatisfactory exploration results have convinced Prospect to turn away from the Zimbabwe lithium projects and focus on copper in Zambia, where it bought the Mumbezhi operation in May.
The Bikita project is made up of 18 claims covering 401 hectares on the Masvingo Greenstone Belt, just 15km from where Sinomine has built Bikita Minerals. After drilling 26 RC holes to explore the area, the company was unhappy with the results.
“The programme failed to define suitable economic volumes of petalite-rich mineralisation near surface and the project works have now been discontinued and all technical data generated has been returned to the original vendors of the lithium asset,” the company says in an update.
Exploration results were no better at Step Aside, near Arcadia Mine.
“Forward strategy Exploration activities at Step Aside have now ceased and expenditure has been pared back to minimum holding commitments,” says the company. Prospect will “instigate a process to potentially monetise the lithium asset in early 2025”.
At the Omaruru project in Namibia, Prospect says it is “now re-assessing its priorities” while “exploration activities have now ceased with expenditure scaled back to minimum holding commitments”.
Since 2021, Zimbabwe has attracted projects worth over US$1 billion into lithium, as investors responded to high demand. This has since slowed down after lithium prices fell by up to 80% over the past year. Bikita Minerals has had to cut back on production to respond to the low prices.
In August, Australia-listed MetalsGrove Mining let go of its lithium projects in Zimbabwe after disappointing exploration results at its prospects at Arcturus and Beatrice.
NewZwire
