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MINING | Prospect Resources
Resource Global Network
PROSPECT RESOURCES
Advancing the 2nd largest JORC compliant hard rock lithium resource in Africa
MINING | Prospect Resources
Prospect Resources is the brainchild of experienced mining executives Hugh Warner and Harry Greaves. The pair formulated a vision to list an Africa-focused mining company on the ASX that would utilise Warner’s vast previous experience as a director of many publicly listed companies along with the localised knowledge of Greaves and his team of Zimbabwean miners involved in various mining assets. It was soon decided that Prospect would initially focus on Zimbabwe, a country with many strong potential mining projects and bags of untapped skills according to Greaves, yet its mineral resources sector has invariably suffered in the past due to a lack of access to capital markets and political instability. However, under the co-guidance of executive chairman Warner, Prospect was listed on the ASX, and the first step of his and Greaves’ plan was realised. In the first couple of years after its listing, Prospect began building a portfolio of gold assets in Zimbabwe but didn’t establish a flagship asset until lithium started to become an increasingly compelling mineral across the investment market.
Resource Global Network At this point the firm began to evaluate a number of potential lithium assets before determining that the Arcadia Lithium Project, a hard rock deposit comprised of spodumene and petalite ore located on the outskirts of Harare, held the most potential. When Prospect acquired the project in mid-2016, it gained access to historical information relating to previous activity at the site, which revealed that the UK Atomic Energy Association completed limited mining of part of the resource dating back to the 1950s and 60s. From this material, the company formulated an initial resource target of 15-18 million tonnes at 3% lithium, ahead of a scoping study at the end of 2016 and pre-feasibility study in June 2017. To say that initial expectations were exceeded by the results of these studies is an understatement.
A globally significant resource “When we started rolling out the drilling programme we discovered what we call the lower main pegmatite, which does not appear to have been previously known about or explored,” says Greaves. “That has pushed us up to a total resource of 72 million tonnes, making Arcadia the sixth biggest lithium hard rock project in the world.” Blowing initial expectations out of the water would be a more appropriate way to describe the results of Prospect’s phased drilling programme.
MINING | Prospect Resources
After continued updates were made to the
Prospect, none more so than its location just
mineral resource estimate over 2017, the
38 km East of the capital Harare.
current estimate for the Arcadia project makes it Africa’s 2nd largest JORC compliant
“We’ve got bitumen roads within 15 km of
lithium resource and one of the most globally
the project. We have abundant water and
significant lithium assets.
power on site and we’ve got a large welltrained and educated labour force in close
In addition to the sheer size of the resource,
proximity. In terms of location we are very
there are a number of other key elements
well suited to getting into production quickly
of the project that are working in favour of
and profitably.”
Resource Global Network
In addition, the project economics are also
Operating in Zimbabwe is a prospect
looking increasingly attractive for Prospect.
that would raise the eyebrows of many
There is no need to construct a big mining
experienced heads in the mining industry,
village or build any major roads and the only
bearing in mind the Southern African nation’s
planned infrastructural work is the repair of
increasingly beleaguered-looking economy
around 16 km of gravel road for the haulage
of late and the significant shift in the political
of concentrate through Goromonzi district
landscape that took place late last year.Â
towards the main arterial road leading to the Beira port in Mozambique.Â
However, in a stark contrast to many reports of business dealings in Zimbabwe, Greaves
MINING | Prospect Resources happily reveals that from the very first
to Greaves. “We are currently witnessing
moment Prospect signed the deal for the
extraordinary levels of cooperation,” he
Arcadia project, the authorities have been
reveals.
nothing short of fantastic in helping the company advance its asset.
“In all my experience of mining in Zimbabwe for 20 years, I’ve never seen a situation where
“We secured the project at the end of May
the entire hierarchy of the ministry of mines
2016 and had drills turning within 30 days.
are available at any time to take a call and
We also declared our MRE (mineral resource
their question
to us is always: How
estimation) within four months and all
can we assist
you to expedite this
regulatory approvals were handled very
project into
production?”
professionally and very quickly.”
‘Extraordinary levels of cooperation’ Moreover, since the change of government in Zimbabwe in November 2017, the operating environment has further improved, according
He goes on
to explain how
the ministry
expedited the
process of
changing claims
into a mining
lease, is assisting
ResourceGlobal GlobalNetwork Network Resource the company with bringing in a bigger power
Zimbabwe’s Minister for Mines and Mining
line to the project and is working very closely
Development Winston Chitando to see first-
with Prospect to get the site designated as
hand how Prospect is delivering battery
a Special Economic Zone, for to the second
grade lithium carbonate.
phase of the project which will deliver a lithium chemical plant adjacent to the
The key reasons behind Prospect building a
existing site.
lithium carbonate pilot are two-fold. One is to demonstrate its commitment to providing
In February 2018, Prospect commissioned a
greater beneficiation to the government
lithium carbonate pilot plant located in the
of Zimbabwe. Two is to provide greater
city of Kwekwe, which was recently visited by
profitability margins for the company. “We will initially be exporting 240,000 tonnes of concentrate primarily to China and a lot of that is just rocks going on holiday,” Greaves quips. “With a chemical plant we gain the ability to turn that concentrate into lithium carbonate in-country,
MINING | Prospect Resources
which it is much more profitable and an
to be available right through the construction
important beneficiation process.”
and will then roll some of those people into
Better returns for country and company
the production phase too. “We can also pull in some of the skilled
The pilot plant was designed and built locally,
people out of the city as we are in such close
which is a strong indicator of Prospect’s faith
proximity to Harare,” Greaves adds.
in the skills and expertise of Zimbabweans and also shows the potential for economic
So far, the pilot plant has successfully
benefits to be shared within the country
processed petalite concentrates into 99.5%
when it comes to building a full-scale
lithium carbonate, which is a significant
carbonate plant.
result for Prospect particularly as it looks to secure future customers for its battery-grade
In the long term, Prospect will create
lithium.
between 250 and 300 direct jobs within the local community in Phase 1 of the project
“We are working on some additional steps in
and around the same in Phase 2, while in
the process now which makes us believe we
the short term a significant amount of heavy
can get much higher grades than 99.5%, and
labour jobs will be available as the project
that is the benefit of having a pilot plant.”
moves into construction.
Arcadia’s first customer
“We are working very closely with our local
Prospect has already secured an exciting
communities to make sure that where the
seven-year offtake agreement with Chinese
skills are appropriate, the communities will
company Sinomine, who have a strong
benefit. We will be training a lot of those folk
footprint across Southern Africa with stakes
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in mining ventures in Zambia and the DRC, as
for the official opening of the mine, with first
well as having access to a lithium carbonate
production slated for Q2 of 2019.
facility in China. Looking beyond the near-term, Prospect has “They have a lot of skills themselves which we
a pipeline of gold projects in Zimbabwe that
will be leveraging off and they have agreed
pre-date the Arcadia project, which are set to
to buy 70% of our product for the next seven
be revisited by the company in the coming
years.
months.
“We are in advanced discussions with three
In addition, the company is exploring various
other potential offtake partners and are very
opportunities across Southern Africa for
confident that we will close out the remaining
several high demand commodities, including
offtake very shortly. There is strong interest
copper-cobalt deposits in the DRC as well
in our spodumene and petalite concentrates,
as various opportunities in Zambia and
as well as the very keen interest in our
Mozambique.
carbonate plans too.” “At the moment our geological team is Prospect has commenced the construction
extremely busy with additional projects
phase of its flagship Arcadia Lithium
across the continent. We would like to keep
Project and is waiting to hear back from the
the company growing very rapidly in the next
President of Zimbabwe with regards to a date
five to 10 years,” concludes Greaves.
ASX:PSC
Published by Anderson Murray Media Ltd
To tell the resource market your story, contact: editorial@resourceglobalnetwork.com
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