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16/04/2024
Mining News

The United Arab Emirates accelerates African mineral resource acquisition race

The United Arab Emirates (UAE) is intensifying its efforts to secure African mineral resources, competing with China, Saudi Arabia, and other players for lucrative contracts. In its latest move, the Gulf state has acquired a copper mine in Zambia and is reportedly vying for another mine, challenging a planned Chinese deal.

Copper, cobalt, lithium, and nickel are crucial minerals for battery performance, essential for powering the global transition toward green energy. Additionally, rare earth elements are indispensable for producing magnets vital in electric vehicle motors and wind turbines. Wealthy Middle Eastern nations, traditionally reliant on oil revenues, are now shifting their focus to minerals critical for clean energy, capitalizing on the global transition.

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According to Reuters, International Resources Holding Limited (IRH), a unit of the UAE’s International Holdings Company, is eyeing the acquisition of the Zambian Lubambe Copper Mine, despite a previous agreement by China’s JCHX to purchase it. This site holds significant potential to become one of Zambia’s largest copper mines. However, any sale requires approval from the Zambian government, which currently holds a 20% stake in the mine.

The International Holdings Company, led by influential figure Sheikh Tahnoon bin Zayed Al Nahyan, has expressed interest in bidding for the 80% stake in the mining project owned by private equity manager EMR Capital. The UAE’s involvement could complicate the sale process to JCHX, as per Reuters sources.

This recent development follows IRH’s successful acquisition of a controlling stake in the Mopani Copper Mines, as confirmed by Zambian President Hakainde Hichilema. With IRH’s involvement, there are plans to revitalize the Lubambe mine’s operations, which have seen a decline in production output.

The UAE’s strategic interest in African mineral resources aligns with its broader investment agenda on the continent. Saudi Arabia, another major player, is also ramping up its efforts in Africa, focusing on developing its domestic mining sector while investing heavily in African mineral resources. At the Saudi-Arab-African Economic Conference last year, Riyadh signed substantial agreements, spanning minerals, renewable energy, and food processing. Moreover, Saudi-backed mining company Manara Minerals is establishing a metals trading arm to support its overseas mining ventures.

Meanwhile, China maintains its position as Africa’s largest trading partner, investing significantly in mining and various service sectors. In 2022 alone, China directed $1.8 billion toward foreign direct investment in Africa, reflecting its enduring economic presence on the continent.

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