Chinese Companies Invest in Nigeria’s Lithium and Electric Vehicle…

Chinese companies are investing heavily in Nigeria’s lithium sector.
Two significant lithium processing plants are set to operate this year.
Nigeria’s government is incentivizing local processing over ore exports.
Jiuling and Canmax are leading the charge in investments in Nigeria.
The lithium deposits in Nigeria are of high grade, with significant production potential.

Chinese Firms Invest in Nigeria’s Lithium Processing Plants

Chinese companies are making significant investments in Nigeria’s emerging lithium and electric vehicle sectors, a move aimed at securing dominance in Africa’s most populous nation. Notably, two major lithium processing plants have been announced, reflecting a broader strategy by Chinese firms to capitalize on Nigeria’s untapped potential in clean energy production. One of these factories, with a hefty $600 million price tag, is being developed by Jiuling Lithium Mining Company in the northern region, set to begin operations in the upcoming quarter, while a second facility costing $200 million is being crafted by Canmax Technologies just outside Nigeria’s capital, Abuja, expected to commence in the third quarter of this year.

Investments Rise Amid Growing Market Potential

With Chinese firms holding over 80% of the stakes in these ventures, there’s a clear indication of their commitment and financial backing, with local investors taking on minor roles. Jiuling has a track record dating back to 2011, emerging as a notable player in the global lithium market, supplying essential materials to major companies like Tesla and BYD. In contrast, Canmax, established in 1997, has pivoted its focus toward lithium processing and plans to ramp up production this year. The cumulative investment from Chinese sources in Nigeria’s lithium sector has now reached approximately $1.3 billion, illustrating an aggressive expansion strategy, as reported by Nigeria’s Ministry of Solid Minerals.

Government Policy Incentivizes Local Processing Investments

While Nigeria is still in the early stages of large-scale lithium production, mineral discoveries suggest immense potential, especially given that some lithium deposits in the country boast high-grade content. The Nigerian government is keen to foster this sector, offering incentives such as a five-year tax holiday and other concessions for manufacturers. Now, under the administration of President Bola Tinubu, there’s a renewed focus on mining policy, which seeks to bolster local refinement instead of allowing raw material exports. This policy shift is evidenced by new regulations requiring investors to outline plans for local processing, prompting the construction of two significant lithium processing plants in the country, as emphasized by solid minerals development minister Dele Alake.

The surge of Chinese investment in Nigeria’s lithium and EV markets underscores a growing interest in Africa’s potential as a clean energy powerhouse. With major companies erecting processing facilities and the government advocating local refinement over raw material exports, the Nigerian landscape is shifting. As the electric vehicle sector develops, the forecast looks promising, positioning Nigeria as a key player on the global lithium stage.