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Desert Lion Energy : China slurps up Namibia's lithium

27 Mar 2018

China slurps up Namibia's lithium30 000 tonnes to leave every six weeks Lithium mining has commenced on a government farm, despite the land reform ministry not allocating it to anyone. Namport will facilitate the export of 30 000 tonnes of lithium concentrate to mainland China in the middle of April, with the same amount leaving every six weeks thereafter.

The first shipment was supposed to have left Namibia during March, but Namport said Desert Lion Energy, the company exporting the lithium concentrate, is still busy stockpiling to reach its first 30 000 tonnes.

Lithium concentrate is generally used in the production of batteries, glass, greases and for air treatment.

Desert Lion Energy, in partnership with !Huni-/Urib Investments, a Namibian company owned by Thomas Mushimba and Mark Welthagen, mines the lithium on a portion of Farm Okongava in the Erongo Region.

Desert Lion Energy CEO, Tim Johnston, who is also the president of the Canadian firm, said last week the company, which received its exclusive prospecting licences (EPLs) in February last year, is still engaging in the reclamation of stockpiled material from the old Rubicon and Helikon lithium mines.

Canadian-based Silasha Ilyas of Desert Lion was quoted by Namport as suggesting that the lithium concentrate is to be used for batteries, a market forecast to grow by 65% to 70%.

“The overall market [for lithium concentrate] today is 200 000 tonnes and consensus estimates are for 800 000 tonnes of demand by 2025,” Ilyas is quoted as saying.

While Desert Lion Energy is preparing its first consignment of lithium concentrate mined at Farm Okongava, the lawful occupancy of the farm remains contentious.

Unfinished business

Controversy over the occupancy of Farm Okongava, which is more than 15 000 hectares in size, on which Desert Lion Energy has the EPLs, still rages on.

“Farm Okongava has been a headache for us since it was acquired,” spokesperson of the land reform ministry spokesperson Chrispin Matongela conceded late last month.

Desert Lion Energy says on its website that it has agreed to pay C$180 000 (more than N$1.5 million at the current exchange rate of 0.11) for each of the EPLs.

Matongela said the ministry has not yet allocated the farm “to anyone” and that members of the Tsoaxudaman Traditional Authority had “simply invaded” parts of the farm.

While Mushimba on an earlier occasion said Desert Lion Energy is only active on a small portion of the farm, Johnston said last week it is occupying 50% of the farm.

The Tsoaxudaman lay claim to the farm because of an arrangement reached with former lands minister Alpheus !Naruseb that it be incorporated into the Otjimbingwe communal area.

Matongela said the request from the traditional authority that Farm Okongava be included in the Otjimbingwe area was “never formalised”, adding that the Tsoaxudaman in the meantime went ahead to demarcate the farm into smaller holdings and administer it as part of the communal area “even with the absence of any official correspondence acknowledging the farm as part of Otjimbingwe”.

“The families are still on the farm and have not moved, even after receiving their eviction order,” Matongela said.

According to Matongela, Desert Lion Energy also has unfinished business with the lands ministry.

Matongela said the ministry has “in the meantime further established that there is a mining operation on the farm”, which he acknowledged is occupying “a large portion” of the farm that has been fenced off by Desert Lion Energy.

He said the company is clearing bushes for roads and drilling boreholes without the knowledge of the lands ministry.

“The ministry has been trying to get documentation/licences to that effect from the company's management but to no avail,” Matongela said. Mushimba refused to comment and referred questions to Johnston, who denied Matongela's assertions.

Johnston said Desert Lion Energy in fact received letters from land reform permanent secretary Peter Amutenya last year, in which permission was granted.

Matongela was still in the dark last Friday with regard the documents and said Mushimba had undertaken to provide him with them soon.

On the Desert Lion Energy website, Johnston is quoted as say that after the first production of lithium concentrate, the company will transition from a lithium explorer and developer to producer, while describing it as Namibia's first large-scale lithium mining operation.

The company said production of lithium concentrate from ore at the site is expected to start in the second half of 2019.

It said the production schedule would be based on the results of a preliminary economic assessment, which it plans to publish in the second quarter of 2018.

Catherine Sasman

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