Race To Explore Lithium In Rwanda

Momentum has been building up in Rwanda for extraction of lithium, a battery metal whose global demand has suddenly been rising fueled in large part by the rapid growth of the electric vehicle industry. 

Rwanda first made its plans clear in 2019 when the government opened up about its long-term agenda to attract investors into exploration and development of lithium, saying that early-stage exploration cycles had shown that there was lithium mineralization in the country with good potential for significant discoveries.

Early exploration work identified a number of areas where lithium is highly concentrated in Rwanda, including in the country’s Ngororero district (Gatumba) in the Western Province where high concentrations of lithium metals were discovered.

The Rwandan government revealed that other areas such as Kabacuzi in Muhanga District and Nyanza District in the Southern Province, Karongi District in the Western Province, Rulindo District in the Northern District, and Rwamagana District in the Eastern Province had shown potential lithium deposits.

Since then, the country’s drive has attracted major investors into the extraction of lithium metal. First, it was Piran Resources which announced that it was looking to kick off exploration activities of lithium in Rwanda.

Piran Resources Limited is part of Pella Resources, a family office or private wealth management firm, which identifies as a mining company focused on the production and exploration of tin, tantalum and tungsten. 

The company had set 2020 as a year in which they planned to kick off what they then described as “deep exploration” of lithium in Rwanda.

“We expect to see a realization of lithium by early next year with large scale mining by mid-2020 as we source funding which is a continuous battle,” Shane Ryan, the head of technical services at Piran Resources Rwanda, told a local newspaper in 2019.

There is little information available publicly that indicates that the company has kicked off these exploration activities. One would perhaps echo Ryan’s sentiments that lithium exploration activities are capital intensive and take time to undertake. 

It’s also true that sometimes companies overpromise and underdeliver for the sake of emphasizing their serious commitment to governments. While I don’t want to pretend to know what could have happened, I know for sure that lithium still holds huge potential for companies like Piran.

Rwanda’s Lithium Prospects 

In Rwanda’s case, despite these commitments, more investors have expressed interest to extract and process lithium. The latest investment commitment comes from British-Australian multinational Rio Tinto, which recently signed a partnership with the Government of Rwanda to start exploring lithium.

The mining giant, which has operations across major mineral rich countries such as Guinea and Mozambique, noted in a statement that the partnership will officially enable them to kick off exploration activities in the country’s west.

“The company is excited to be partnering with the government of Rwanda, applying our global experience to accelerate the search for primary lithium deposits in Rwanda’s Western Province,” Lawrence Dechambenoit, Rio Tinto’s Global Head of External Affairs, said in a press statement.

Mining presents huge potential to Rwanda and the country’s ability to attract key investors such as Rio Tinto could accelerate the development of critical minerals and position Rwanda on the global map. 

“The entry of Rio Tinto marks Rwanda's resolve to further unlock the potential of the country's mining sector,” Yamina Karitanyi, the CEO of Rwanda Mines, Petroleum and Gas Board, said in a statement. 

The partnership allows Rio Tinto to implement its previously agreed terms with London Stock Exchange listed firm Aterian Plc. The two firms completed a joint venture for the exploration and development of lithium and by-products in Rwanda.

Aterian holds a 70 per cent shareholding in the Kinunga Mining Ltd, which has licence to extract lithium in Rwanda’s Southern Province. The joint venture agreement that Aterian signed with Rio Tinto allows the latter to invest $7.5 million in two stages to earn up to a 75 per cent interest in the Licence.

In the first stage, Rio is expected to spend $3 million on exploration activities over a period of two years to earn an initial 51 per cent interest in the Licence.

In the second stage, the company will spend $4.5 million over a follow-on period of up to three years to earn a further 24 per cent interest in the Licence, taking RIO’s interest in the Licence to 75 per cent.

Aterian previously said it identified 19 separate lithium-caesium-tantalum (LCT) pegmatite zones across the 2,750-hectare project in Rwanda offering the prospective scale necessary to attract major partners.