17/02/2026
Zijin Commences Lithium Operations at Contested Congo Mine
BY
MUFLIH HIDAYAT
FEBRUARY 16, 2026
Market Psychology and Strategic Positioning in Critical Minerals
The global battery metals landscape operates through complex layers of supply chain control, geopolitical maneuvering, and strategic resource positioning.
Understanding how major economies secure lithium access reveals fundamental shifts occurring beneath surface-level price movements and production announcements. When examining lithium market dynamics, investors must consider not just immediate supply and demand fundamentals, but the underlying power structures that determine long-term market access and pricing control. Moreover, as
zijin begins lithium production at disputed congo site, this development exemplifies the complex intersection of resource diplomacy and strategic mineral extraction in critical markets.
China's approach to African mineral extraction demonstrates sophisticated resource diplomacy that extends far beyond traditional mining investment models. The integration of financing, infrastructure development, and processing capabilities creates vertically integrated supply chains that resist external disruption. Furthermore, this strategic depth becomes particularly relevant when analyzing how new lithium production facilities fit within broader
critical minerals transitionframeworks.
What Makes the DRC's First Lithium Mine a Game-Changer for Global Supply Chains?
Strategic Positioning in Africa's Critical Minerals Landscape
The Democratic Republic of Congo's emergence as a lithium producer represents more than simple capacity addition to global markets. The country already controls approximately
70% of global cobalt production, creating synergistic opportunities for integrated battery materials processing.
Consequently,
Zijin begins lithium production at disputed congo site establishes the DRC as a dual-source supplier for two critical battery metals within the same geographic corridor.
Geographic advantages become pronounced when considering shipping routes to Asian battery manufacturers. Traditional Australian lithium suppliers face longer transport distances and higher logistics costs compared to African operations targeting Chinese processing facilities. Additionally, the existing infrastructure connections between Chinese-controlled mining operations in Central Africa create economies of scale that benefit new entrants like the Manono project.
Integration with established Chinese mineral corridors in the region provides operational efficiencies that independent developers struggle to match. Shared port facilities, established relationships with local governments, and existing workforce training programs reduce the typical startup challenges faced by greenfield mining operations in remote locations.
Production Scale and Technical Specifications
The Manono project's technical specifications position it among the world's most significant hard-rock lithium operations. With planned production of
500,000 tonnes of spodumene concentrate annually, the facility represents substantial addition to global lithium supply. The target output of
95,170 tonnes of crude lithium sulfate per year places Manono among the top-tier lithium operations globally.
| Specification | Manono Project | Industry Benchmark |
|---|
| Annual Spodumene Concentrate | 500,000 tonnes | 200,000-400,000 tonnes |
| Lithium Sulfate Output | 95,170 tonnes | 50,000-80,000 tonnes |
| Lithium Oxide Grade | 1.51% | 1.0-1.5% |
| Project Investment | $1 billion | $500-800 million |
The lithium oxide grade of
1.51% compares favourably with established Australian operations, indicating that ore quality should support profitable extraction even during periods of depressed lithium pricing. Higher-grade deposits typically maintain better cost structures throughout market cycles, providing operational flexibility during extended downturns.
Processing capacity designed for immediate export orientation reflects the project's integration with Chinese supply chains. Unlike operations that require extensive local beneficiation, Manono's configuration allows for rapid market response and flexible output allocation based on demand patterns.
How Do Ownership Disputes Shape Investment Risk in African Mining?
The AVZ-Zijin Legal Framework Analysis
The permit cancellation and reassignment process that transferred control from AVZ Minerals to Zijin Mining illustrates the complex regulatory environment governing African mining investments. The timeline of events between
2023 and 2024demonstrates how quickly ownership structures can shift when government priorities change or when competing interests present more attractive development proposals.
International arbitration mechanisms provide some protection for displaced investors, but the practical reality of ongoing operations creates facts on the ground that complicate legal remedies. AVZ's pursuit of international arbitration represents a test case for how effectively foreign investment treaties protect mining rights when host governments reassign permits to alternative developers.
Key Insight for Investors: Jurisdictional risk in African mining extends beyond traditional political stability concerns to include permit security and the enforceability of existing agreements when competing developers present alternative development scenarios.
The speed with which Zijin commenced construction while legal disputes remained unresolved highlights the practical advantages of maintaining positive government relationships and demonstrating immediate development capability. This approach contrasts sharply with Western mining companies' tendency to seek legal clarity before commencing major capital expenditure. However,
reuters reports that this rapid development approach reflects broader Chinese strategic priorities in African resource extraction.
Joint Venture Structure and Capital Allocation
Zijin Mining's controlling stake of
61% in the Manono project provides operational control while allowing Congolese partners to maintain meaningful ownership participation. The structure differs from traditional mining joint ventures by eliminating capital contribution requirements from local partners, instead relying entirely on Chinese financing sources.
The
$1 billion project financing arrangement exclusively from Chinese sources creates debt structures that align with Beijing's broader African infrastructure initiatives. This financing model removes traditional Western banking requirements and environmental assessments that often delay project development timelines.
Revenue-sharing mechanisms allow Cominière to receive proportional returns without contributing development capital, creating attractive terms for government-backed entities while ensuring operational control remains with the technical partner. This structure has become increasingly common in Chinese mining investments across Africa.
Why Has Production Been Delayed from Q1 to June 2026?
Construction Milestone Analysis
Current construction progress at Manono indicates substantial infrastructure completion despite the delayed production timeline. Key milestones already achieved include:
- Accommodation facilities: Worker housing and administrative buildings operational
- Solar power Phase I: Initial renewable energy capacity installed and operational
- Hydroelectric rehabilitation: Existing power infrastructure restored to working condition
- Site preparation: Mining areas cleared and initial extraction zones prepared
The remaining commissioning requirements focus primarily on smelter operations and processing equipment calibration. These technical aspects typically require several months of testing and optimisation before reaching full production capacity.
Comparison with similar hard-rock lithium projects suggests that the
June 2026timeline aligns with industry standards for complex processing operations. Most comparable projects experience
3-6 monthdelays from initial production estimates due to the technical complexity of lithium extraction and purification processes.
Market Timing Considerations
The production delay coincides with favourable market conditions for new lithium suppliers. Current lithium prices reflect an
86% collapse from 2022 peaks, creating opportunities for cost-effective market entry without competing against established producers operating at maximum capacity.
Strategic timing advantages include reduced pressure for immediate revenue generation, allowing for thorough equipment testing and process optimisation. This approach contrasts with projects that commenced production during peak pricing periods and subsequently struggled with operational challenges during market corrections.
Inventory management during current oversupply conditions allows new producers to build stockpiles for strategic release when market conditions improve. This flexibility provides operational advantages that established producers with ongoing cash flow requirements cannot easily replicate.
What Are the Broader Geopolitical Implications for Critical Minerals?
China's African Resource Strategy Evolution
The expansion from cobalt-focused investments to comprehensive battery materials extraction represents a significant evolution in Chinese resource strategy across Africa. Rather than pursuing single-commodity operations, Chinese companies increasingly develop integrated supply chains that control multiple components of battery manufacturing. Furthermore, the
zijin expansion strategy demonstrates how this approach creates competitive advantages across multiple markets.
Contrasting approaches between Chinese and Western mining development reveal fundamental philosophical differences.
While US-backed operations like KoBold Metals await complete legal clarity before commencing construction, Chinese developers proceed with active development while managing legal risks through ongoing negotiations.
| Investment Approach | Chinese Model | Western Model |
|---|
| Legal Risk Management | Parallel development and negotiation | Complete resolution before construction |
| Financing Sources | State-backed institutions | Private equity and debt markets |
| Timeline Priority | Speed to production | Regulatory compliance |
| Partnership Structure | Revenue-sharing without capital requirement | Equity participation with capital contribution |
This strategic divergence creates competitive advantages for Chinese operations in environments where government preferences favour rapid development over procedural precision.
Supply Chain Diversification Challenges
US efforts to redirect Congolese minerals away from Chinese control face structural challenges rooted in existing infrastructure and established relationships. The interconnected nature of Chinese mining operations across multiple African countries creates switching costs that government policies struggle to overcome through incentives alone. Additionally, the
us‑china trade impacts continue to influence strategic resource allocation decisions.
European Union lithium security considerations increasingly focus on African sources as alternatives to Chinese-controlled supply chains. However, the capital requirements and technical expertise needed for competing development projects remain concentrated among Chinese mining companies.
Australia's response to African competition involves emphasising operational reliability and environmental standards rather than competing on cost structures. This positioning strategy acknowledges that Australian producers cannot match the integrated supply chain advantages available to African operations targeting Chinese markets. Consequently,
australian lithium innovations focus on technological differentiation rather than cost competition.
How Does This Impact Global Lithium Market Dynamics?
Production Capacity Integration Analysis
Zijin Mining's global lithium production target of
250,000-300,000 tonnes lithium carbonate equivalent (LCE) by 2028 positions the company among the world's largest lithium suppliers. The Manono project's contribution represents approximately
30-40% of this total capacity, indicating the strategic importance of the Congolese operation within Zijin's global portfolio.
Integration with Chinese-controlled lithium processing facilities provides Manono with preferential access to downstream markets. This vertical integration reduces exposure to spot market volatility while ensuring consistent demand for production output regardless of broader market conditions.
Three potential market share scenarios emerge from Manono's production ramp:
- Conservative Integration (15-20% of Chinese lithium imports): Steady market penetration without disrupting existing supplier relationships
- Aggressive Market Capture (25-30% of Chinese imports): Rapid displacement of higher-cost Australian suppliers
- Supply Chain Dominance (35%+ of imports): Combined with other African operations, fundamentally altering global lithium trade flows
Price Recovery Implications
Current market oversupply conditions mask the long-term significance of new production capacity additions. While immediate price impacts remain muted due to existing inventory levels, the structural cost advantages of integrated African operations will become apparent during the next demand growth cycle.
Hard-rock lithium production costs in Africa benefit from lower labour expenses, reduced regulatory compliance costs, and integrated logistics systems. These advantages become pronounced during periods of constrained supply when higher-cost producers face margin pressure.
Investment Consideration: Lithium market recovery timing depends not just on demand growth from electric vehicle adoption, but on the retirement of higher-cost production capacity during extended low-price periods.
What Operational Challenges Could Affect Project Success?
Infrastructure and Logistics Considerations
Export route development through Central African transport corridors requires coordination with multiple government authorities and existing mining operations. The shared infrastructure approach provides cost advantages but creates dependencies on external operations that could affect production scheduling.
Power supply reliability from rehabilitated hydroelectric facilities represents both an opportunity and a risk factor. While renewable energy sources provide cost advantages and environmental benefits, the dependence on aging infrastructure in remote locations creates operational vulnerabilities that backup systems must address.
Local workforce development programmes face the challenge of training personnel for sophisticated lithium processing operations while managing community expectations for employment opportunities. The balance between technical requirements and local hiring preferences affects both operational efficiency and social licence maintenance.
Technical Risk Assessment
Processing complex spodumene ores in remote African locations requires technical expertise typically concentrated in established mining regions. The transfer of processing knowledge and maintenance capabilities to local operations represents an ongoing challenge that affects long-term operational sustainability.
Quality control for lithium sulfate export specifications must meet international battery industry standards while operating in environments with limited technical infrastructure. Maintaining consistent product quality requires sophisticated laboratory capabilities and quality assurance systems.
Key operational risk mitigation strategies include:
- Redundant processing systems:Multiple processing lines to maintain production during maintenance periods
- Technical training programmes:Comprehensive skill development for local technical personnel
- Supply chain partnerships: Established relationships with equipment suppliers and service providers
- Quality monitoring systems: Real-time product testing and specification compliance tracking
How Should Investors Evaluate This Development?
Direct Investment Implications
Zijin Mining's stock performance correlation with lithium price cycles provides investors with exposure to both the company's operational improvements and broader market recovery. The company's diversified mining portfolio reduces single-commodity risk while maintaining significant lithium market exposure.
Comparison with ASX-listed lithium producers reveals different risk-return profiles based on operational geography and market access. Australian producers typically offer greater regulatory predictability and operational transparency, while African operations provide higher growth potential and lower cost structures.
Risk-adjusted return profiles for African mining investments require premium returns to compensate for jurisdictional uncertainty, operational complexity, and political risk. However, the strategic advantages of integrated supply chain positioning may justify these risk premiums during periods of supply constraint.
Mining technology reports suggest that
zijin begins lithium production at disputed congo site represents a significant milestone in African resource development.
Sector-Wide Impact Analysis
Competitive pressure on established Australian producers intensifies as African operations achieve full production capacity. Cost structure advantages of integrated African operations become particularly pronounced during extended periods of low lithium prices.
Supply security benefits for battery manufacturers create strategic value beyond immediate cost savings. Diversified supply sources reduce dependency risks while providing negotiating leverage with established suppliers.
| Market Impact Factor | Australian Producers | African Operations | Global Market Effect |
|---|
| Cost Structure | Higher labour and regulatory costs | Lower operational costs | Price pressure on high-cost producers |
| Supply Reliability | Established track record | Developing operational history | Increased supply diversity |
| Market Access | Global export capability | Preferential Chinese access | Shift toward Asian processing centres |
| Expansion Potential | Limited by resource availability | Substantial undeveloped reserves | Long-term supply growth concentrated in Africa |
What Does This Signal for Future African Mining Development?
Precedent Setting for Chinese Investment Models
The financing structure that bypasses Western development banks creates replicable models for future African mining projects. Chinese state-backed financing provides alternatives to traditional project finance requirements while accepting different risk profiles than Western institutional investors.
Speed advantages of Chinese project execution become particularly apparent when comparing development timelines with Western-backed competitors. The ability to proceed with construction while managing legal risks through parallel negotiations provides competitive advantages in environments where government priorities favour rapid development.
Regulatory relationship building with African governments emphasises economic development outcomes over procedural compliance requirements. This approach aligns with government priorities for immediate revenue generation and employment creation.
Critical Minerals Race Acceleration
Expected timelines for additional DRC lithium projects depend on the success of Manono operations and continued Chinese investment commitment. Successful production ramp and stable operations at Manono will likely attract additional investment to neighbouring deposits with similar geological characteristics.
Other African countries with significant lithium deposits include Zimbabwe, Mali, and Ghana, each presenting different regulatory environments and infrastructure challenges. The template established by Manono operations provides a framework for evaluating investment opportunities across the continent. Additionally, the
big pivot minerals strategy demonstrates how broader market participants are responding to these developments.
The acceleration of critical minerals development in Africa reflects broader strategic competition between major economies for secure supply chain access. This competition drives investment in previously marginal deposits while creating opportunities for countries with appropriate geological endowments. As
zijin begins lithium production at disputed congo site, this development signals intensifying competition for strategic resource control across the continent.
Disclaimer: This analysis contains forward-looking statements and market projections that involve inherent uncertainties. Lithium market conditions, geopolitical developments, and operational outcomes may differ significantly from current expectations. Investment decisions should consider comprehensive due diligence and professional financial advice appropriate to individual circumstances.
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