Battery metal project development in sub-Saharan Africa
Key trends and challenges
As the global economy pursues net-zero transition goals, rapid growth in the demand for Li-NMC and LFP batteries by the energy and automotive sectors has seen unprecedented levels of investment by raw metals producers and battery manufacturers – $140 billion in 2024, and $160 billion forecast for 2025.
In Africa, the minerals that are used in these batteries are broadly concentrated in a handful of naturally endowed nations: lithium (Zimbabwe, Democratic Republic of Congo (DRC), and Mali), nickel (South Africa, Tanzania Madagascar and Côte d’Ivoire), manganese (South Africa, Ghana and Côte d’Ivoire), graphite (Madagascar, Mozambique and Tanzania), and cobalt (DRC and Zambia). With the economic growth slowdown and metals price pressures that characterised 2024 now subsided, these markets present substantial opportunities for metals producers and investors as the world races to meet the requirements of a global transition.
Participation in Africa’s battery metal supply chain will be context-specific by necessity – the diversity of local conditions demand a custom approach by market and project. The checklist in Part 2 below provides a framework for tailoring bespoke country and project strategies. Part 1 below identifies six continental trends or key events in critical markets for raw metals producers and investors to track as they build out their African portfolios.
1.Growth in African lithium production
Despite continued rapid growth in battery metals supply over the past decade, an estimated $2.1 trillion in new mining investments is needed to meet the demands of a net-zero emissions world by 2050. With technological advancements shifting in favour of Li-NMC and LFP (both lithium-heavy batteries), battery producers consume more than 80% of the 130,000 tonnes of lithium mined globally today, with this forecast to grow to 95% by 2030. This demand is projected to increase sixfold by 2035, which current sources in Australia, Chile and China – accounting for more than 90% of the current global supply – are unable to cater to.
Anticipating the projected supply squeeze of this critical mineral, exploration and early development of lithium assets in Africa have been exponentially scaled in recent years. The continent’s lithium production tripled in 2024 – increasing Africa’s share of global output from 4% to approximately 10% – as surges in Chinese financing identified and developed multiple assets in Zimbabwe, home to the world’s largest known deposits of lithium. For example, Chinese mining company Rwizi Rukuru commissioned a 300-ton-per-day lithium concentrator in Mutoko, northeastern Zimbabwe, in April 2024. Should the full potential of Zimbabwe’s lithium assets come online, the country is projected to be able to address 20% of global demand. Beyond Zimbabwe, lithium exploration projects are also ongoing in Mozambique, Namibia, Ghana, DRC, and Mali.
2. Growth in African rare earths production
At present, Africa’s share of the rare earths market is insignificant. However, over the next few years, mines in Angola, Malawi, South Africa, Tanzania, and Uganda are expected to commence production, with the continent forecasted to contribute 10% of global supply by 2030. These projects include Malawi’s Songwe Hill and South Africa’s Steenkampskraal mines, both of which are expected to become operational in 2025.
China currently dominates the rare earths market, accounting for 61% of production and 92% of processing. Notably, these minerals feature in the ongoing ‘trade war’ between China and the US; specifically, in April 2025, China implemented export restrictions on seven rare earth elements in response to the Trump administration’s tariff increases on Chinese goods. Subsequently, on 15 April 2025, president Trump ordered the US Department of Commerce to investigate potential national security risks posed by the US’ reliance on importing processed critical minerals and associated products. In theory, this investigation may lead to US tariffs on the importation of all critical minerals; however, the measure is viewed as an attempt to place specific pressure on China, given the country’s current monopoly in processing critical minerals. (At present, various battery metals and critical minerals – such as cobalt, lithium, platinum and copper – are exempt from the reciprocal tariff scheme introduced by the Trump administration in April 2025. As such, these measures are not expected to impact African exporters at the time of writing).
Overall, amid growing geopolitical tensions between China and the US, Africa’s future rare earths supply will likely become strategically valuable for various international players – particularly the US and the EU – as they attempt to secure supply chains independent of China.
3. Raw mineral export restrictions used to exert greater control over markets
In recent years, export restrictions (including outright bans) of various raw minerals have become increasingly common across Africa. Since 2022, more than 12 African countries have implemented such restrictions, including the DRC (2025), Ghana (2024), Namibia (2023), and Zimbabwe (2022). Through these measures, governments primarily seek to promote domestic beneficiation and technology transfers, or bolster commodity prices by reducing supply. This trend is likely to continue, as African governments increasingly seek greater local beneficiation of their mineral endowment and to address budget deficits following the COVID-19 pandemic. In general, these bans are temporary, with mining companies often stockpiling until restrictions are lifted.
In the short-term, these restrictions can be successful in achieving their objectives. As an example, in 2022, Zimbabwe banned the export of unprocessed lithium to encourage local beneficiation; subsequently, in 2023, the country’s export earnings from lithium tripled, as mining companies were required to build local processing plants. Further, the DRC’s recent cobalt export ban has seen prices rise from historic lows (see below). However, in the long term, these bans risk being counterproductive if governments do not address the infrastructural deficits and policy uncertainty that hinder local processing. These include improving electricity supply, freight and port infrastructure, as well as ensuring greater policy predictability. Furthermore, these restrictions may hinder foreign investment, particularly if mining companies can easily source minerals in alternative markets.
One way to mitigate this trend is for foreign investors to invest in local beneficiation projects as far as possible. Doing so would likely provide investors with waivers if future export bans were to occur in their respective jurisdictions. Furthermore, investors can manage this risk through building diversified supply chains, thus reducing their dependence on single markets.
DRC Cobalt export ban and proposed export quotas (2025)
In early 2025, cobalt prices fell to their lowest level since 2016 due to stagnating demand from the electric vehicle market and oversupply resulting from increased global copper production (cobalt is a byproduct of copper and nickel mining). In response, on 24 February 2025, the DRC – which accounts for approximately 75% of global cobalt supply – suspended exports of cobalt for four months, with the aim of creating a price floor for the commodity. In the words of the DRC’s Authority for the Regulation and Control of Strategic Mineral Substances’ Markets (ARECOMS), this measure was intended to “regulate supply on the international market, which is faced with a production glut.” Following this ban, cobalt prices reportedly increased by more than 50% by the end of March 2025.
Subsequently, on 19 March 2025, the DRC announced its intention to impose export quotas on cobalt once the export ban comes to an end (with one quota focusing on exports and another focusing on local beneficiation). In addition, the DRC intends to collaborate with Indonesia – the world’s second largest cobalt producer, responsible for 11% of production – to “better control” cobalt prices through reducing supply. In the short term, these measures are expected to increase cobalt prices; however, the long-term impact is unclear, given ongoing stockpiling by mining companies. Further, sustained levels of copper production will likely result in continued high levels of cobalt supply.
Over the medium to long term, Indonesia’s growth as a cobalt producer will reduce the DRC’s dominance of the industry; according to one estimate, by 2030, Indonesia will account for 21% of global cobalt production, with the DRC’s share declining to just under 60%. This Indonesian growth has been driven by Chinese investments in nickel cobalt processing facilities in recent years, as well as local government policies (including a nickel ore export ban in 2019) focused on building a domestic supply chain for electric vehicles.
4. Renewed investment by major firms in the Copperbelt
In recent years, the Zambian Copperbelt has seen renewed investment by international firms, driven by improvements in the Zambian business climate under the presidency of Hakainde Hichilema (in office since 2021). Prior to this, between 2011 and 2021, several mining companies postponed expansion projects or significantly reduced their production due to the policy uncertainty and major shareholding disputes associated with various governments of the Patriotic Front (particularly Edgar Lungu, president of Zambia between 2015 and 2021).
Following various reforms by Hichilema, since 2022, international firms have reportedly committed to investing more than $10 billion in the Zambian mining sector. This includes investments of $2 billion by Barrick and $1.25 billion by First Quantum Minerals, both focused on significantly increasing output at existing copper mines over the next few years. Moreover, in 2023, exploration investments reached a 10-year high, with firms like Rio Tinto and First Quantum Minerals earmarking funds for copper exploration projects.
Although investor sentiment has improved under Hichilema, Zambia’s structural power crisis remains a major challenge for the energy-intensive mining sector. In 2024, Zambia experienced a severe drought due to the El Niño phenomenon, which significantly hampered the country’s power generation capacity. This is because Zambia relies on hydropower for more than 80% of its electricity. Currently, prolonged power outages are common, with mining companies relying on electricity imported from Mozambique and South Africa to maintain their operations. Zambia’s structural over-reliance on hydropower, as well as climate change-related shocks, mean that mining companies in the country are required to invest significantly in self-generation initiatives (as discussed below).
5. Japan looks to Africa to secure minerals for nascent domestic EV market
Across the 2020s, Japan has been progressively demonstrating interest in battery metal development and smelting projects in Africa, in a bid to grow its local electric vehicle (EV) manufacturing capabilities without depending on China for raw materials. In 2023, Yasutoshi Nishimura, Japan’s economy and industry minister, visited key African markets and signed memoranda of understanding (MoUs) to secure Japan’s supply chain of critical minerals. Today, the Japan Oil, Gas and Metals National Corporation (JOGMEC) has MoUs with 14 countries in Africa, and five joint venture exploration projects in Zambia and Namibia.
The Japanese private sector’s involvement in Africa’s battery metals sector remains limited, and unlike their counterparts in the Gulf, Japanese companies have been conservative in their expansion into the continent’s supply chain. However, we expect to see greater participation in years to come – since 2023 the state has subsidised half the costs of lithium, manganese, nickel, cobalt and graphite development and smelting projects by Japanese companies to encourage participation. Although unlikely to compete with China’s bullish approach to battery metal project investment in Africa, Japanese companies could plausibly challenge the Gulf and the ‘Western’ pool of investors – like Canada, Australia and even the US – for access to these minerals. A recent high-profile transaction demonstrates such competition – Japanese trading firm Mitsui bid for a 20% stake in First Quantum Minerals’ Sentinel and Kansanshi copper mines in Zambia, reportedly offering $2 billion more than the current highest bid. At the date of this briefing, First Quantum Minerals has not yet accepted a bid.
Overall, Japan’s entry into the battery value chain means greater competition, strengthening the bargaining power of African governments to dictate market and export terms (see above), particularly if/as market participants jostle for regional influence amid increased global geopolitical tensions.
6. Large-scale smelting prospects remain weak amid continuing energy insecurity
Energy security remains a major challenge for mining firms, given the structural energy deficit across Africa. Generally, governments do not have the capacity to invest in power generation projects to support large-scale mining projects. This means that mining companies are largely responsible for addressing energy security themselves, and increasingly generating their own power through renewable projects or buying power from independent power producers (IPPs) where possible. In Southern Africa in particular, governments have become more accommodative of such arrangements recently, creating mechanisms to allow private entities to generate and transmit independently generated electricity via the national grid. Most notably, South Africa has introduced significant electricity-related reforms in recent years, including raising the self-generation cap from 1 MW to 100 MW in 2021 (meaning that 1- 100 MW projects do not require generation licenses).
Taking South Africa as an example of this self-generation trend, since 2020, major mining companies – including Sibanye-Stillwater, Anglo American Platinum and Harmony Gold – have announced investments of at least $3.8 billion in renewable energy projects to generate at least 585 MW to support their operations. Similarly, in Zambia, First Quantum Minerals and its partners, including Total Energies, are developing a solar and a wind project (totalling 430 MW), which are expected to become operational in 2026 and 2027 respectively.
Mining companies are also increasingly sourcing power from neighbouring countries or regional power pools. As an example, in 2024, First Quantum Minerals mitigated the operational impact of Zambia’s energy shortage by importing power from Mozambique and South Africa. The company also plans to conclude an offtake power agreement with Mozambique’s Temane thermal plant, once it becomes operational in 2025.
Notwithstanding these positive developments, Africa’s energy insecurity, as well as relatively high electricity prices, bode poorly for smelting ventures and thus the region’s beneficiation prospects. For example, in March 2024, Zambia’s Chambishi copper smelter – one of Africa’s largest – cut its production by 20% due to widespread power shortages. Moreover, in South Africa, Glencore and its JV partner Merafe Resources have closed 10 of their 22 ferrochrome furnaces over the last four years, mainly due to high electricity prices amid volatile ferrochrome prices. In February 2025, the Glencore-Merafe venture announced that it may close other smelters by May, arguing that high South African electricity prices make it more viable to export raw chrome ore than to smelt it locally. Overall, the outlook for large-scale smelting across Africa is poor; for prospects to improve, large-scale power generation needs to occur, whereby energy utilities and independent producers sell large quantities of cost-effective energy to mining customers. This is unlikely in the short to medium term, meaning that new and current investors are required to invest significantly in self-generation initiatives to support their smelting operations.
A checklist for managing project risk
In this section, we present a ‘checklist’ of the key issues to monitor and address pre-emptively through participation in Africa’s battery metals supply chain. Our focus is on identifying and managing context-specific policy, political and reputational risks, and on the critical factors for successful operational execution, rather than on project financing issues or commercial and legal due diligence.
Sector framework
Policy predictability
Will any likely future changes to the way in which mining licences are procured and approved be applied retrospectively, introducing contract or licence revocation risks?
Is there a coherent regulatory framework in place in the country? For example, is the royalty structure clear and cost-reflective; and is the tendering process transparent?
How predictable is the broader tax structure –are any tax holiday periods transparently and publicly communicated, or is there a risk that these could become subject to revision?
Are there local content requirements for foreign-owned mining assets and operators in the country? If so, is there a precedent of this requirement having been leveraged as a vehicle for patronage by political stakeholders?
Is there a precedent for mineral export bans being issued and what are the driving forces behind these decisions?
State involvement
What role do state entities play as joint venture partners? Where state mining companies have operational and financial obligations as partners, can they deliver on these commitments on time?
In the case of public tenders, are there any uncertainties regarding the bid process? If aspects of the process are fixed, what criteria are important to state decision makers? Is there a possibility of a procurement challenge being made due to shortcomings in the bid process?
Are licence approval processes overtly political or subject to corruption and bribery?
Local dynamics
Local political and ESG issues
What are the local political and social dynamics around the mining site? If there is opposition to the project, what’s driving this?
Which local stakeholders have the ability to influence the project (e.g. political representatives, community leaders, and NGOs)? What are their motivations and current levels of support?
Are there any material ESG risks associated with the asset’s development? If there are pre identified ESG risk issues requiring an offset plan, what is the potential for negative local or global media coverage, or NGO criticism?
Are there robust oversight mechanisms in place to ensure that all project contractors and sub contractors apply the same best-practice ESG standards as the mine’s lead investor?
Is there a clear grievance mechanism in place to defuse any tensions early? Is there an opportunity to develop an inclusive and open forum to resolve issues? Are there strategic partners – such as local employment commissions, economic groups, or youth or women’s groups – to engage with?
Project location
How close are the nearest formal or informal settlements and transport arteries to the mining site? Will these be affected by site construction or transmission lines?
Is there a past precedent of land conflict in the area? Is there a precedent of site incursion by artisanal and small-scale mining groups and if so, how was this handled?
Can physical security and access control be ensured around the mining site? Is this dependent on local law enforcement agencies (if so, is there a clear channel of communication in place with these agencies? Is there any past precedent of rights violations by these forces)?
Partner selection
Due diligence
If a local partner led the early development, what is the track record and reputation of this company and its key principals? Do they have experience in the sector? How transparent was their initial land acquisition process?
Are the local partners politically exposed? Do the key individuals have any political and business affiliations or relationships of note? If so, were these relationships unduly leveraged to secure the project?
Does the local partner have any litigious disputes ongoing in court?
Any there any credible allegations of bribery, corruption, nepotism or mismanagement relating to the past activities of the local partner?
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